EN    EN EN 
EN    EN  EUROPEAN COMMISSION 
Brussels, 7.9.2010 
SEC(2010) 1017 final 
  
REPLY OF THE COMMISSION TO THE SPECIAL REPORT  
"IMPROVING TRANSPORT PERFORMANCE ON TRANS-EUROPEAN RAIL AXES: 
HAVE EU RAIL INFRASTRUCTURE INVESTMENTS BEEN EFFECTIVE?"  
EN 2   EN REPLY OF THE COMMISSION TO THE SPECIAL REPORT  
"IMPROVING TRANSPORT PERFORMANCE ON TRANS-EUROPEAN RAIL AXES: 
HAVE EU RAIL INFRASTRUCTURE INVESTMENTS BEEN EFFECTIVE?"  
EXECUTIVE SUMMARY  
II. first indent. The Commission agrees that the de finition of the Priority Projects has not been 
based on an analysis of the actual and anticipa ted traffic flows. It is important to note, 
however, that while such studies have been ca rried out, both for individual projects and the 
network, they have yet to lead to conclusive  results and so could not be used as such. 
The Commission considers that providing a definitive description of the main trans-European 
rail axes is likely to be particularly difficult, as they are in a constant  state of flux depending 
on migration, trade patterns a nd the geopolitical context. The Commission, however, also 
shares the view that the defi nition of the main network shoul d be based on objective criteria. 
Therefore, in the future, Priority Projects shoul d continue to be based on political agreement 
between the Council and European Parliament, but  relying even more on the best available 
evidence.  
II. second indent. The Commission welcomes th e Court's recognition of the improvements 
flowing from the concentration of TEN-T co-fin ancing at cross-border locations and the work 
of the Coordinators. It agrees that further work on defining a bottleneck is needed and will 
work on this. 
The Commission considers that th e procedures for approving pr ojects are sound, particularly 
following their substantial overhaul for th e 2007-2013 programming period. These procedures 
were substantially strengthened by the integra tion of the Cohesion Fund  in programming and 
specific measures to improve project prep aration, documentation and the quality of 
Commission appraisals.  
II. third indent. The Commission welcomes this positive assessment of what the TEN-T and 
Cohesion co-financed projects have delivered. It would emphasise that, as the Court states in 
its paragraph 47, cost escalations do not have an impact on the EU budget because the EU's 
contribution is fixed at the beginning of the project.  
II. fourth indent. The Comm ission shares the Court's an alysis of the measurable 
improvements on lines dedicated to high-speed passenger services . It is working to improve 
the situation on conventional mixed and freight lines. 
III. first indent. The Commission already has clos e contacts with the Member States and the 
Railway Institutions. It will continue to work cl osely with them. In addition, as part of its 
ongoing stakeholder consultati on exercise on the TEN-T gui delines, the Commission is 
looking for input on how trans- European corridors for which th ere is significant actual or 
anticipated demand can best be delivered. 
III. second indent. The Commission agrees that the Coordinators  play a vital role and it 
appointed three new ones on 8 June 2010, bringing their number to nine. 
The Commission agrees that further work on defining a bottleneck is  needed and will 
continue to work on this. The European coor dinators have analysed the bottlenecks on the 
Priority Projects for which they are respons ible. The Commission has also reported on the 
bottlenecks in its yearly reports.  
EN 3   EN III. third indent. The Commission considers that  the procedures for approving projects under 
the Cohesion Policy for the 2007-2013 pr ogramming period are sound. The Commission 
continues to work on their improvement and is investing significant resources to contribute to 
the improvement of project preparation. 
The Commission welcomes the Court's recogn ition of the improvements made to TEN-T 
selection procedures; however, it accepts that there is room for improvement as regards the 
use of cost-benefit analysis. The TEN-T Executive Agency is working to develop this further; 
nevertheless, given that TEN-T  financing only co-funds a limited amount of each project 
compared to that funded by Member States, it is  logical that the onus for assessing costs and 
benefits should fall on them, particularly as almost all data and assumptions originate from them. 
III. fourth indent. The Commission recognises the importance of exchanges of information 
amongst project promoters. The TEN-T Executive Agency will facilitate  this by organising 
discussions at its regular works hops with current and potential beneficiaries on best practices 
and knowledge exchange between all project prom oters, particularly in the rail sector. 
III. fifth indent. By adopting Technical Specifi cations for Interoperability the Commission has 
worked, and will continue to work, on these "practical constraints". The European Coordinators also devote partic ular efforts to these issues. 
INTRODUCTION
 
11, footnote 6. When presenting figures relate d to investments in its documents the 
Commission bases itself on the information provided by Member States. Recognising that the 
quality of the financial data would benef it from improvement, the Commission invested 
significant efforts which resulted in the in formation in the Comm ission's June 2010 report 
being significantly better th an in previous reports.  
14. The Commission underlines that, prior to 2 007, Cohesion Fund projects were adopted on a 
project-by-project basi s and in line with the available budget credits. The legal basis for the 
Priority Projects only  applied after 2004.  
OBSERVATIONS  
22. The Commission understands that the Court means by stating that “the Priority Projects do 
not represent definitive descriptions of the main trans-European rail axes” that there needs to be general agreement on what are the main axes, and that this agreement should remain as stable as possible over time.  
The Commission considers that it is likely to be  particularly difficult to provide a definitive 
description of the main trans-European rail axes , as they are in a constant state of flux as a 
function of migration, trade pa tterns and the geopolitical context. The Commission, however, 
also shares the view that the definition of  the main network should be based on objective 
criteria. Therefore, in the future, Priority Pr ojects should continue to  be based on political 
agreement between the Council and European Parl iament, but relying even more on the best 
available evidence.  
22. third indent. While the Commission acknowledge s that connections to some important sea 
ports are not included in the Priority Projects , it would underline that many are. On 4 May 
2010, as part of its TEN-T revision process,  it put forward a working document that 
establishes the methodology for identifying a futu re TEN-T network. This  should avoid any 
future occurrence of the situ ation described by the Court. 
Box 4 
EN 4   EN The Commission acknowledges that the ERTMS corr idors do not 100% coin cide with Priority 
Projects. ERTMS has requirements that need to  be met for both infrastructure and rolling 
stock. The TEN-T revision proces s is designed to tackle this , and one possibility being 
considered is to include ERTMS corridors directly into the Priority Projects. 
The Commission understands that th e Polish authoritie s will submit an application for funding 
for the part of the Polish north-south axis from  Warsaw to Gdynia in late 2010, that this will 
include ERTMS and that it will have an indicative total cost of 386 million euro.  
23. The Commission agrees that there is scop e for improving the definition of Priority 
Projects. This is something that is being addressed through the TEN -T revision process. 
24. The Commission agrees that the definition of th e Priority Projects has not been based on 
an analysis of the actual and anticipated traffic flows. It is important to note, however, that 
while such studies have been carried out both for individual projects and the network, they 
have yet to lead to conclusive results and so could not be used as they stood. 
As the Court has stated, the Commission acknow ledges the need to review the TEN-T policy. 
This review is currently bei ng carried out and includes an examination of the methodology for 
defining the future TEN-T network. 
29. The Commission considers that EU financing has had a significant influence on all the 
TEN-T sections reviewed by the Co urt for this audit. This has included improving the projects 
originally planned or reducing their risk.  
30. The Commission considers that, in countri es covered by the Cohesion Fund, many rail 
projects would simply not go ahead without the s ubstantial EU co-fin ancing from the 
Cohesion Fund or the ERDF including cross-bord er sections, thereby improving accessibility 
and performance for all users. The requirement  is to give priority to technically and 
economically mature projects that are feasible within the programming period; otherwise the 
Funds may be lost to the beneficiaries. 
The definition of major projec ts in Article 39 of Regulat ion (EC) No 1083/2006 has been 
amended to make it easier for the Member States to submit major cross-border projects.  
33. The Commission agrees that further work on defining a bottleneck is needed and will 
continue to work on this. The European coordi nators have analysed the bottlenecks on the 
Priority Projects they are responsible for. The Commission also reported on the bottlenecks in 
its yearly reports.  
34. The Commission for the 2007-2013 period impr oved its approval procedures for major 
projects co-funded by the ERDF and the Cohesi on Fund. Large projects co-financed under the 
Cohesion Fund in the 2000-2006 period were ofte n approved section by section for budgetary 
reasons. In this sense the quality  of the preparation of individua l sections may not reflect the 
quality of preparation and deve lopment of the overall axis. 
35. Internal consultation of the relevant Comm ission services ("inter- service consultation") 
has been and still is a crucial element in the appraisal and approval process.  
In the 2007-2013 programming period the Co mmission has established JASPERS, which 
provides technical assistance to the new Member States in  order to contribute to the 
improvement of quality of projects at an early stage. It also  has a contract with outside experts 
for technical advice in the a ppraisal of major projects. 
Under shared management, the project promoter  is responsible for adequately defining the 
technical specifications of pr ojects. The adoption of techni cal specifications (see annex I) 
makes a significant contribution to improving the technical quality of rail infrastructure. The 
EN 5   EN Madrid-Levante project was approved in stag es, section-by-section, for budgetary reasons, 
and not in its totality, as the network involves a total of 940 km of high-speed rail. The EIB 
was consulted and its recommendations were progressively taken on board in this project. The EIB considered the financing of this projects justified and itself is providing substantial loans 
for it, in addition to the Cohesion Fund support. 
The Commission disagrees with the implication th at subsequent cost escalations were all 
linked to the EIB’s concerns. It considers that as  explained in reply to 46 other factors were 
responsible. 
37.first indent. The Commission would like to empha sise that external ex perts are at the heart 
of the TEN-T project selection process. There is also an external observer who provides 
comprehensive feedback to the TEN-T Executive Agency on the whole external evaluation process. 
38. While the Commission welcomes the Court' s recognition of the improvements made to 
selection procedures, it accepts that there is ro om for improvement as regards the use of cost-
benefit analysis. In the future, the TEN-T Executive Agency will develop a more systematic approach to cost-benefit analysis taking into acco unt existing work. In order to do this it will 
work with the projects selected in priority  3 of the 2010 annual call to improve project 
preparation, including by deve loping consistent approaches to cost-benefit analysis. 
Nevertheless, given that TEN-T  financing only co-funds a limited amount of each project 
when compared to that funded by Member States, it is logical that the on us for assessing costs 
and benefits should fall on them, particularly as  almost all data and assumptions originate 
from them. 
As far as the coherent model of European rail traffic flows is concerned, the Commission 
remains to be convinced that the additional insights it would provide would justify the 
potentially significant level of resources needed in order to bring it to fruition. 
44. A Memorandum of Understanding was adopted  on 8 June 2010, setting out the steps to 
remedy this situation. The th ree Member States concerne d by PP3 (France, Spain and 
Portugal) have signed it. 
45. The Commission would like to emphasise that  cost escalations are typical for large 
infrastructure projects. 
46. The Commission agrees on the benefits of thorough and detailed project preparation; 
however, as the Court states in the previous paragraph, cost es calations in th e cases studied 
generally arose for reasons li nked to unforeseeable factors. 
Concerning the Madrid–Levante s ection (but also other equally complex projects), the cost 
increases mentioned by the Court could be due to a variety of factors, some of which are 
unforeseeable. For example, high inflation in co nstruction projects in Spain and an unforeseen 
increase in costs due to difficult geological co nditions have had a significant effect on the 
Madrid-Levante project cited by the Court.  
47-48. The Commission shares the Court's opinion that the cost escalations did not have a 
direct impact on the EU budget and notes that the Court has not documented any indirect 
impacts either. 
The Commission would like to underline that , according to the new model of financing 
decisions for TEN-T funds for the period 2007- 2013, the beneficiaries and project promoters 
have to submit a Strategic Action Plan (SAP) detailing how the project will be implemented, including in terms of pr oject planning, the risk management  plan and project governance. The 
EN 6   EN TEN-T Executive Agency has already developed guidelines on this issu e and is working on 
the exchange of good practices between beneficiaries. 
Box 8 
The Warsaw-Gdynia, stage II project faced many problems that are independent of the 
Commission's approval procedures, such as significant delays in the tendering procedures, 
problems with land purchase and ensuring access to  the building site, as well as disputes with 
contractors. The Commission has repeatedly raised the issue of  cost overruns on the Warsaw - 
Gdynia, stage II project, and the Polish authoriti es have announced that  they will submit a 
modified proposal for it. The Commission made  it clear that it will not process this 
modification without the Polish authorities subm itting a horizontal analysis on cost overruns 
in the rail sector and how they are dealt with. 
54. The Commission agrees with the Court that  overall progress on tr ans-European rail 
transport depends on achieving syne rgies between the effects of le gislative measures affecting 
markets and interoperability and co-financing policy measures. 
Box 11 
The Commission is closely monitoring this situa tion in the framework of ERTMS Corridor A. 
It has adopted a European Development Plan for ERTMS, as well as a proposal for a 
regulation for Rail Freight Corridors, which wa s adopted on 15 June 2010 by the European 
Parliament and the Council. Moreover, the Co mmission has appointed TEN-T Coordinators.  
Box 12 
The Commission is aware that no freight trains currently use the Roma-Napoli and Bologna-
Firenze high-speed, high capacity lines. Howeve r, thanks to the intr oduction of these high-
speed, high-capacity lines, there has been more capacity for freight transport on the existing 
conventional lines. In any case, most of the exp ected benefits from th e ERDF funded sections 
relate to passengers' improved access to the ra il network and not to freight transport.  
57. The Commission acknowledges that progress towa rds interoperability is slow. Radical 
harmonisation is not possible, given that rail  infrastructure and ro lling stock have long 
lifetimes and the sector's investment costs need to remain realistic. 
Nevertheless, the amount of interoperable infrastr ucture and rolling stock is increasing and the 
number of derogations requested by Member  States from the Commission's implementing 
legislation setting out Technica l Specifications for Interoperability (TSI) is limited. This 
shows that the existing TSIs are being impl emented successfully. As far as the TEN-T 
network is concerned, the TSIs are expected to be completed in 2010. This will benefit both 
TEN-T and Cohesion policy funded projects. 
The Commission will continue its efforts by concentrating on the implementation of TSIs that 
will deliver significant benefits in the short and medium term, such as telematics applications 
in signalling, freight and passenge r transport. It has also se t up corridor organisations to 
identify and tackle all issues that hamper the competitiveness of rail freight along axes.  
As far as the measures in paragraph 8 of Annex VII are concerned, the Commission considers 
that steps are being taken at the Eur opean level to improve the situation: 
1) in the framework of Directive 2008/57, activi ties are ongoing to classi fy all national rules 
regarding rail traffic, assess which ones are equi valent and thus avoid d uplication of controls, 
in particular at the borders 
EN 7   EN 2) in the framework of the ERTMS corridor s, working groups are identifying all existing 
obstacles - in particular delays  at the borders - by looking at the obstacles sp ecific to each 
border.  
60. The European coordinators have made effort s to alleviate system constraints on corridors, 
which will be extended as a result of th e proposed regulation on rail freight. 
The Commission's November 2008 proposal for a re gulation creating a structure for each rail 
freight corridor is also significant in this re spect. It will devel op reinforced cooperation 
between Infrastructure Managers on traffi c management (operational measures) and 
investment (mainly to remove bottlenecks and ha rmonise technical conditions). It is based on 
the experience with the Rotterdam-Genoa and Antw erp-Lyon/Basle corridors. 
CONCLUSIONS AND RECOMMENDATIONS  
62. The Commission welcomes the work of the Court, which is especially timely given the 
upcoming revision of the TEN-T networks. 
63. The Commission agrees with the Court that Pr iority Projects are th e main mechanism for 
co-ordinating and conc entrating financial resources on TE N-T networks and continues to 
pursue this course, while ensuring complementar ity with regional development objectives and 
cohesion policy. In this light, it understands why the Court wishes that Priority Projects 
should be defined on the basis of an analysis of current and e xpected traffic flows. It is 
important to note, however, that while such studi es have been carried out, both for individual 
projects and for the network, they have yet to  lead to conclusive results and so cannot 
currently be used as such. 
The Commission considers that arriving at a defi nitive description of the main trans-European 
rail axes is likely to be particularly difficult, as they are in a constant  state of flux depending 
on migration, trade patterns a nd the geopolitical context. The Commission, however, also 
shares the view that the defi nition of the main network shoul d be based on objective criteria. 
Therefore, in the future, Priority Projects shoul d continue to be based on political agreement 
between the Council and European Parliament, but  relying even more on the best available 
evidence. 
Recommendation 1 
Recommendation 1. first indent. The Commission already has clos e contacts with the Member 
States and the Railway Institutions . It will continue to  work closely with them on rail traffic 
matters. 
Recommendation 1. second indent. As part of its ongoing stakeholder consultation exercise 
on the TEN-T guidelines, the Commission is look ing for input on how this can best be done. 
64. The Commission welcomes the Court's acknowledgement of the improvements flowing 
from the concentration of TEN- T co-financing at cross-border lo cations and the work of the 
Coordinators. It agrees that fu rther work is needed to define  a bottleneck and will work on 
this. 
The Commission notes that Cohesion Fund project  approval procedures  have substantially 
changed from 2007. 
The Commission welcomes the Court's recogn ition of the improvements made to TEN-T 
selection procedures; however, it accepts that there is room for improvement as regards the 
use of cost-benefit analysis.  
Recommendation 2 
EN 8   EN Recommendation 2. first indent. The Commissi on agrees that furthe r work on defining 
bottlenecks is needed and will continue to wo rk on this. The European Coordinators have 
analysed the bottlenecks on th e Priority Projects for which they are responsible. The 
Commission also reported on the bottl enecks in its yearly reports.  
Recommendation 2. second indent. The Commission ag rees that the Coordinators play a vital 
role and appointed three additi onal Coordinators on 8 June 2010. 
Recommendation 2. third indent . The Commission considers that the procedures for 
approving projects are sound, particularly follo wing their substantial overhaul for the 2007-
2013 programming period. The Commission continues to work on their improvement and is 
investing significant resources to  contribute to the improvemen t to project preparation and 
appraisal As far as the technical characteristics of  projects are concerned, their review will be 
greatly improved through the cont inued development of TSIs.  
Recommendation 2. fourth indent. The Comm ission accepts that there is room for 
improvement as regards the use of cost-benefit  analysis. In the future, the TEN-T Executive 
Agency will develop a more systematic approach  to cost-benefit analys is. To do this it will 
work with the projects selected in priority  3 of the 2010 annual call to improve project 
preparation, including by deve loping consistent approaches to cost-benefit analysis. 
Nevertheless, given that TEN-T  financing only co-funds a limited amount of each project 
when compared to that funded by Member States, it is logical that the on us for assessing costs 
and benefits should fall on them, particularly as almost all da ta and assumptions therefore 
originate with them. 
Recommendation 3 
The Commission recognises the importance of exchanges of informa tion amongst project 
promoters. The TEN-T Executive Agency will faci litate this by organisi ng discussions at its 
regular workshops with current and potential beneficiaries on best practices and knowledge 
exchange between all project promoter s, particularly in the rail sector. 
66. The Commission shares the Court's analysis of the measurable improvements on lines 
dedicated to high-speed passenger services. It  is working to improve the situation on 
conventional mixed and freight lines. 
Recommendation 4 
Recommendation 4. first i ndent. Through adopting Tec hnical Specifications for 
Interoperability the Commission has worked on thes e "practical constraints" and will continue 
to do so. The European Coordinators also devote special efforts to these issues. 
Recommendation 4. second indent. In November 2008, the Commission proposed a 
regulation creating a structure fo r each rail freight corridor that will strengthen cooperation 
between Infrastructure Manage rs (supervised by Member States), for traffic management 
(operational measures) and for investment (m ainly in removing bottlenecks and harmonising 
technical conditions). It is based on the experience with th e Rotterdam-Genoa and Antwerp-
Lyon/Basle corridors.