WRITTEN QUESTION P-1521/98

by Karin Riis-Jørgensen (ELDR) to the Commission

(7 May 1998)

Subject: Competitive position of private bus companies operating between the regions of Denmark

Does the Commission believe that it is in accordance with the EU's competition rules for the Danish law regulating the bus industry to allow private bus companies to be prevented from establishing new long-distance bus routes and from expanding traffic on already existing routes between the various regions of the country in order to shield publicly owned railway and bus companies from competition?

With reference to Section 4 of the law regulating the bus industry, the Passenger Transport Board at its latest meeting (18 March 1998) turned down a series of applications from private bus companies wanting to establish new long-distance bus routes between Jutland and Zealand (Copenhagen) via the new bridge over the Great Belt.

The same provision is used by the Passenger Transport Board to impose restrictions on private bus companies seeking to expand traffic on already authorized long-distance bus routes by, for example, limiting the number of daily departures and fixing routes between terminuses (including what ferry companies may be used across the Kattegat and whether the Great Belt can be used as an alternative route). The result is that, in certain situations, the companies in question cannot serve the number of passengers wanting to travel by express bus between the various regions of the country.

It seems that the Passenger Transport Board's use of Section 4 of this legislation is not based on an assessment of possible competition between Danish State Railways and the private express bus companies, since the competitive position in this area has not been investigated in Denmark. Reliance is placed on statements by Danish State Railways who are represented on the decision-making body.

Answer given by Mr Kinnock on behalf of the Commission

(11 June 1998)

The Commission considers, as a matter of principle, that Community competition rules should be respected by all transport operators including public undertakings. However, certain undertakings entrusted with the operation of services of general economic interest may be granted special or exclusive rights under certain conditions established in Article 90 EC Treaty.

Such restrictions to the access to the market might be specially justified when authorities impose on these undertakings public service obligations which are compensated through public funding. In addition Community law establishes(1) that where the authorities of the Member States decide partly or wholly to maintain a public service obligation, and where this can be done in more than one way, each capable of ensuring, while satisfying similar conditions, the provision of adequate transport services, the authorities shall select the way that is least costly to the community. The adequacy of transport services shall be assessed having regard to the possibility of having recourse to other forms of transport and the ability of such forms to meet the transport needs under consideration.

The compatibility of the Danish regulations and current practices concerning regular bus services and railway systems with Community competition rules would have to be determined on a case by case basis. The Commission has not been provided with information which indicates violation of these rules.

(1) Article 3 of Regulation (EEC) 1191/69 of the Council 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 as modified by Council Regulation (EEC) 1893/91 of 20 June 1991.