WRITTEN QUESTION E-3295/00

by Mathieu Grosch (PPE-DE) to the Commission

(25 October 2000)

Subject: Cross-subsidisation and setting-off of losses in the railway sector

In its notice on the application of the competition rules to the postal sector and on the assessment of certain State measures relating to postal services(1), the Commission states that: Avoiding cross-subsidisation leading to unfair competition is crucial for the development of the postal sector mldr . By contrast, subsidising activities open to competition by allocating their costs to reserved services is likely to distort competition in breach of Article 86. It could amount to an abuse by an undertaking holding a dominant position within the Community. (p. 10). The Commission also considered that, in the context of the application of Articles 90 and 92, the Member State concerned [was invited] to make sure that the postal operator adopted an analytical cost-accounting system' (p. 14). The Commission is currently examining the accusation that the German Post Office operated setting-off of losses and cross-subsidisation of the parcels service by means of monopoly revenue from the letter service.

In Belgium, the logistics and transport firm of ABX Logistics (goods transport by road) has emerged alongside the national railway operator SNCB. ABX Logistics owns a large sector of the market in the Benelux area in this transport sector and is in direct competition with private haulage firms, since it has also purchased transport firms in Germany, France, Italy, Spain, Portugal and Korea.

1. To what extent are the rules which the Commission has enacted in the field of postal services pursuant to Articles 82 and 87 of the EC Treaty also applicable to the railway sector and to the case of SNCB v. ABX Logistics?

2. Can the Commission guarantee that there is no instance in this case of unfair competition by means of cross-subsidisation and setting-off of losses on the part of SNCB? If not, what measures does the Commission propose to take?

3. Is ABX Logistics not under an obligation, in view of its economic activity, to introduce a separate analytical cost-accounting system?

(1) OJ C 39, 6.2.1998.

Answer given by Mrs de Palacio on behalf of the Commission

(7 December 2000)

1. The notice mentioned by the Honourable Member sets out the Commission's interpretation of relevant Treaty provisions and the guiding principles according to which the Commission intends to apply the competition rules in the postal sector in individual cases. Consequently, the notice does not a priori apply directly to the transport sector. However, since Articles 82 and 87

(ex Articles 86 and 92) of the EC Treaty also apply to the transport sector in general and to the railway sector in particular, it can be assumed that the general principles in the notice and which can be derived from these articles may, where appropriate, apply also in the transport sector in individual cases.

2. In so far as the Honourable Member refers to the situation of SNCB and ABX-Logistics, it should be noted that the Commission is currently investigating the issue under relevant state aid provisions. Obviously, the Commission cannot prejudge the outcome of this investigation and, as the Honourable Member will understand, can neither give any guarantees, nor propose any measures before the investigation has been concluded.

3. The Transparency Directive Commission Directive 2000/52/EC of 26 July 2000 amending Directive 80/723/EEC on the transparency of financial relations between Member States and public undertakings(1), obliges undertakings, which, on the one hand, provide services of general economic interest and receive compensation for this in whatsoever form and, on the other hand, are also active outside these services, to operate a system of separate accounts. However, this obligation does not apply to sectors already covered by specific rules on transparency. As far as inland transport is concerned, such rules exist for undertakings operating services subject to public service obligations(2) and also for railway undertakings in general(3).

Consequently, insofar as ABX-Logistics operates in a sector not covered by specific rules on transparency and, in addition to its normal commercial activities, provides services of general economic interest for which it receive compensation, it has to apply an accounting system in accordance with the Transparency Directive.

(1) OJ L 193, 29.7.2000.

(2) Council Regulation 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, (OJ L 156, 28.6.1969) as amended by Council Regulation (EEC) No 1893/91 of 20 June 1991 (OJ L 169, 29.6.1991).

(3) Directive 91/440/EEC of 29 July 1991 on the development of the Community's railways, (OJ L 237, 24.8.1991).