WRITTEN QUESTION E-1523/00

by Erik Meijer (GUE/NGL) to the Commission

(12 May 2000)

Subject: Plans to reduce the market share of national, regional and local public transport operators

1. On 12 April 2000, the Dutch periodical OV-Magazine reported that European Commissioner de Palacio was considering replacing the existing Regulations 1191/69(1) and 1893/91(2) with a new regulation containing different provisions concerning the financial relationship between public authorities and public transport operators, with the aim of promoting competition, one element of which would consist of reducing to 25 % the maximum market share which any public transport operator should be permitted to hold in a town, province or country. Can the Commission confirm that such changes to the rules are being considered or prepared?

2. Does the Commission either in accordance with the plans referred to in Question 1 or otherwise intend to make it impossible in future for a public transport operator owned by a municipality or by a regional authority (the authority of a conurbation, province or Land) to operate the public transport services of the area concerned, with democratic control by the municipal council, regional assembly or national parliament over the network, quality and fares? What advantages would there be in such a reduction in democratic control?

3. Can the Commission confirm that in most cases, even after the compulsory breaking-up and privatisation of existing public transport enterprises (as for example after the abolition and breaking-up of British Rail), monopolies continue to exist on most lines, so that genuinely free competition does not obtain, and that the further introduction of free competition would result in situations similar to those which exist in the Third World, where normal public transport has in many cases been replaced by poor services based on taxibuses without fixed routes, timetables or fares?

4. Why should an upper limit for market share apply to public transport operators which does not apply to other enterprises, which would moreover require successful operators to give up some of their routes if passenger numbers were to rise sharply and which would ultimately result in good operators having to surrender routes to competitors who would offer a poorer service?

(1) OJ L 156, 28.6.1969, p. 1.

(2) OJ L 169, 29.6.1991, p. 1.

Answer given by Mrs de Palacio on behalf of the Commission

(6 July 2000)

The public transport sector is no longer composed of tightly closed national markets, and there is a need to update Community legislation (notably Council Regulation (EEC) No 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(1) and Council Regulation (EEC) No 1893/91 of 20 June 1991 amending Regulation (EEC) No 1191/69(2)). The Commission's work programme for 2000 includes a proposal to do so. The Commission is still working on the details of this proposal.

Society often needs more and better public transport than the market will supply. Public authorities need to set standards for quality, fares and integration. The Commission plans to reinforce this role, not hinder it. Many publicly owned public transport companies provide an excellent service. The Community has no power to exclude them from access to the market, and there would be no advantage in doing so. However, the advantages of competition entailing better and more cost-effective services make a strong case in favour of ensuring that operators holding exclusive rights or public contracts are obliged, from time to time, to demonstrate that they are still capable of providing the best service for the area.

The Commission shares the view that completely deregulated public transport markets, which operators may enter and leave at any time, do not offer passengers the best result. In particular, they make it very difficult to ensure integration between the services provided by different operators. By contrast, studies suggest that controlled competition, in which exclusive rights last for a fixed period and are renewed following competition, is a promising approach. Experience is most widespread in the bus sector, where most Member States have introduced or plan to introduce an element of controlled competition, with good results.

It is true that there may be a need, in the context of market opening, for authorities in the Member States to take action to deal with damaging market concentration. But the Commission has no plan to propose mandatory limits on the market share that an operator may hold.

(1) OJ L 156, 28.6.1969.

(2) OJ L 169, 29.6.1991.