WRITTEN QUESTION P-3843/98

by Konstantinos Hatzidakis (PPE) to the Commission

(7 December 1998)

Subject: Preferential treatment by the Greek Government of the Greek Railway Organisation and Post Office

The Greek Ministry of Transport is seeking the adoption of draft legislation for reimbursement of debts incurred by the Greek Railway Organisation (OSE), amounting to DR 550 billion, and the Greek Post Office (ELTA) amounting to DR 70 billion, either from national budget appropriations or by contracting loans guaranteed by the Greek Government. This would enable the Greek Railway Organisation and Post Office to set fares and prices in accordance with different criteria to those applying on the free market.

Can the Commission say if, and to what extent, these provisions are in accordance with Article 86a of the Treaty establishing the European Community (abuse of a dominant position within the market and directly or indirectly imposing prices), if it considers that these measures lead to unfair competition at the expense of private undertakings in the same sectors and to what extent the measures concerning the Post Office are in accordance with the principles of free competition, in particular the provisions of Article 90(2) and 7d of the Treaty, in the light of the decision by the European Court of Justice to recognise the principle of free competition as applying to Post Office services?

Answer given by Mr Van Miert on behalf of the Commission

(25 January 1999)

The Commission is not aware of the measures in favour of the Greek Post Office referred to by the Honourable Member, which have not been notified to it pursuant to Article 93(3) of the EC Treaty. It will therefore have to contact the Greek authorities with a view to obtaining the information in question. A supplementary answer will be sent to the Honourable Member as soon as the Commission is in a position to comment on these two cases.

Council Directive 91/440/EEC of 29 July 1991 on the development of the Community's railways(1) requires the Member States to set up appropriate mechanisms to help reduce the indebtedness of railway undertakings to a level which does not impede sound financial management and to improve their financial situation. The Commission recently adopted a communication on the implementation and impact of the above-mentioned Directive(2) which highlights the results achieved by railway undertakings. In its communication it noted that debt servicing continued to represent a heavy burden for railway undertakings in several Member States, including Greece. However, it acknowledged that the overall debt of railway undertakings in the Community had improved between 1980 and 1995.

With regard to the measures in favour of the Greek Railway Organisation referred to by the Honourable Member, the Commission would point out that Directive 91/440/EEC states that aid for rail transport must be granted in accordance with Articles 77, 92 and 93 of the EC Treaty. However, the specific measures introduced by Council Regulation (EEC) 1107/70 of 4 June 1970 on the granting of aids for transport by rail, road and inland waterway(3), by Council Regulation (EEC) 1191/69 of 26 June 1969 on action by Member States concerning the obligations inherent in the concept of a public service in transport by rail, road and inland waterway(4) and by Council Regulation (EEC) 1192/69 of 26 June 1969 on common rules for the normalisation of the accounts of railway undertakings continue to apply. The compensation, aid and intervention granted by national authorities on the basis of the aforementioned Regulations are notified regularly to the Commission, which makes this information available to the Member States in the form of an analytical report. The Commission is currently updating the report for 1997.

(1) OJ L 237, 24.8.1991.

(2) COM(98) 202 final.

(3) OJ L 130, 15.6.1970.

(4) OJ L 156, 28.6.1969.