WRITTEN QUESTION E-0019/03

by Margrietus van den Berg (PSE) to the Commission

(20 January 2003)

Subject: Contracting-out of train services in the Netherlands

In the Netherlands 31 train services shown by the current service provider, the Netherlands Railways (NS), to be profitable are on a list of services being put to tender. In recent years the privatisation of the Netherlands Railways has already caused major problems for passengers because of declining services. Many people question the wisdom of this measure and wonder whether the Netherlands Railways do not simply belong in public ownership.

1. Is it correct that current European legislation does not require the Netherlands to put 31 train services out to competitive tender?

2. Is it not so that a balanced assessment would also have to take account of the necessary investment in equipment in order to arrive at a sustainable approach and does the Commission consider that the omission of this cost heading entails an unacceptable erosion of passenger services?

3. Would it not be better for the regions concerned such as the North, South and East Netherlands where these services are extremely important in social, economic and accessibility terms to exempt the services from being put out to tender for the time being or to agree on a reflection period during which the primary consideration would be to safeguard the interests of passengers and the regions?

4. Is the Commission prepared to put this matter, which has already led to a deterioration in services and problems in many European regions, on the agenda for European transport ministers at the forthcoming Transport Council meeting?

Answer given by Mrs de Palacio on behalf of the Commission

(27 February 2003)

Except in the cases of public works concessions, i.e. contracts where the counterpart for the works to be carried out consists fully or partly in the right to exploit the construction(1), the detailed rules foreseen by the European public procurement directives for the award of public contracts do not apply to the cases mentioned by the Honourable Member. However, if a contracting authority or a contracting entity decides to grant contracts for railway transport to a third party, it has to respect the principles of the EC Treaty, and in particular those of equality of treatment, non-discrimination and transparency. Concerning more specifically the principle of transparency, according to consistent case law the

obligation of transparency which is imposed on the contracting authority consists in ensuring, for the benefit of any potential tenderer, a degree of advertising sufficient to enable the services market to be opened up to competition and the impartiality of procurement procedures to be reviewed(2).

Furthermore, the Commission has proposed a Regulation on the granting of public service contracts for public passenger transport in road, rail and inland waterways(3). In this proposal the Commission supports mandatory tendering, with minor exceptions, of public service contracts in case of any financial compensation to the operator or exclusive rights. The two main arguments for this proposal are that: tendering of public services has proved to be an effective instrument for creating more attractive services to passengers at lower costs to the taxpayer; and that the direct award of financial compensation or exclusive rights for the provision of public transport services is vulnerable to legal challenge. Therefore, although tendering as provided in the Regulation may not be mandatory at the moment, directly awarded contracts are, in the Commission's view, less desirable and legally vulnerable.

Public authorities organising a tender for rail public services should take into account the service quality for passengers as is also stated in the Commission proposal. A request for investment could be part of that.

The Commission believes that tendering of rail services, especially regional rail services has given good results up until now for the passenger. Experiments with tendering of public transport in the eastern part of the Netherlands have proven to be successful, notably in terms of integration of bus and rail services.

The Commission has submitted a proposal concerning public service requirements in passenger transport, and would favour further Transport Council debate at the earliest opportunity in order to make progress on the dossier, and to allow the achievement of the objectifs of the Common Transport Policy as set out in the White Paper European transport policy 2010: Time to decide(4).

(1) E.g. construction of a railway line and operation of it.

(2) see Court of Justice of the European Communities, case C-324/98, Telaustria.

(3) OJ C 151 E, 25.6.2002.

(4) COM(2001) 370 final.