REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Fifth report on monitoring development of the rail market
Date: 2016-12-08
Institutions: Directorate-General for Mobility and Transport, European Commission
Subjects: EU Member State, carriage of goods, carriage of passengers, common transport policy, free competition, rail transport, transport infrastructure, transport market

EN 

   EN 

   EUROPEAN COMMISSION  Brussels, 8.12.2016  COM(2016) 780 final   REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Fifth report on monitoring development of the rail market {SWD(2016) 427 final}  
 
 
REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND 
THE COUNCIL 

Fifth report on monitoring development of the rail market 

1.  INTRODUCTION 
The  rail  sector1  makes  a  substantial  contribution  to  the  EU  economy,  directly  employing 
about  900 000  people.  Rail  transport  is  also  critical  to  the  EU  strategy  for  improving 
environmental  performance  of  the  transport  sector,  economic  and  social  cohesion  and 
connectivity within and between Member States. 

This report is the fifth edition of rail market monitoring reports submitted by the Commission 
to  the  European  Parliament  and  the  Council  pursuant  to  Article  15(4)  of  Directive 
2012/34/EU2 (‘the Recast Directive’). The purpose of this report is to provide an overview of 
main  developments  in  rail  markets  in  the  context  of  EU  rail  market  policy  objectives.3  It 
covers a broad range of topics such as the evolution of the internal market in rail services and 
services to be supplied to railway undertakings, the framework conditions including for public 
passenger transport services by rail, the state of the Union railway network, the utilisation of 
access  rights,  barriers  to  more  effective  rail  services,  infrastructure  limitations  and  the  need 
for legislation. A full analysis is presented in the accompanying staff working document. 

This report is based on data and contributions from various sources, including Member States’ 
responses  to  the  rail  market  monitoring  survey  (RMMS),  the  statistical  pocketbook  ‘EU 
transport  in  Figures’,4  reports  of  the  European  Union  Agency  of  Railways,5  Eurostat6  and 
various other resources. In July 2015, the Commission adopted an Implementing Regulation 
for rail market monitoring,7 establishing a new mandatory data collection mechanism which 
should lead to more consistent and coherent reporting in future. 

2.  THE STATE OF THE UNION RAILWAY NETWORK 

The total length of rail network in 2014 was about 220 000 kilometres, which is about 2 % 
more  than  in  2009.  Since  2009,  2  800  km  of  electrified  lines  have  been  added,  while  their 
proportion  in  all  lines  has  increased  by  1.6  percentage  points.  For  the  coming  years 
Banedanmark  (the  Danish  infrastructure  manager)  and  Network  Rail  (the  UK  infrastructure 
manager)  have  launched  large-scale  projects  for  the  electrification  of  major  parts  of  their 
networks. 

There  are  major  differences  between  Member  States  in  terms  of  travel  speeds.  Significant 
investment  has  been  made  to  modernise  the  rail  network  in  eastern  Europe  and  to  develop 
high speed lines in western Europe. The higher speeds have improved the attractiveness of rail 
for passengers. However, there are still regional passenger networks in eastern Europe where 

1 
2 

3 

4 
5 
6 
7 

In this report ‘rail sector’ refers to railway undertakings and rail infrastructure managers. 
Directive 2012/34/EU of the European Parliament and of the Council of 21 November 2012 
establishing a single European railway area, OJ L 343, 14.12.2012, p. 32. 
In addition to rail market report, the European Union Agency for Railways publishes bi-annual reports 
on safety and interoperability performance of railways. 
http://ec.europa.eu/transport/facts-fundings/statistics/pocketbook-2016_en.htm. 
http://www.era.europa.eu/Search/Key-Documents/Pages/Home.aspx. 
http://ec.europa.eu/eurostat/web/transport/data/database. 
Commission Implementing Regulation (EU) 2015/1100 of 7 July 2015 on the reporting obligations of 
the Member States in the framework of rail market monitoring, OJ L 181, 9.7.2015, p. 1. 

2 

 
 
                                                 
maximum  permitted  speed  is  120 km/h  or  even  less.  As  regards  the  travel  speed  of  freight 
trains,  in  some  national  networks  and  international  rail  freight  corridors  it  is  50-60  km/h. 
However for the most of international freight trains, especially in central and eastern Europe, 
the average speed is between 20 and 30 km/h. On some international routes freight trains run 
at an average speed of only around 18 km/h.8  

3.  THE EVOLUTION OF THE INTERNAL MARKET IN RAIL SERVICES 

Despite  an  unfavourable  economic  climate  since  2009,  rail  passenger  volumes  in  terms  of 
passenger-kilometres  were  hardly  impacted.  By  contrast,  rail  freight  volumes  in  tonne-
kilometres  dropped  heavily  in  2009,  the  low  point  of  the  economic  crisis  and  have  not  yet 
fully recovered. Total passenger and freight train-kilometres have not increased. 

Passenger traffic 

Figure 1 – 

Evolution of rail passenger traffic volumes 

s
e
r
t
e
m
o

l
i
k
-
r
e
g
n
e
s
s
a
p
n
o

i
l
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i

b

440

430

420

410

400

390

380

370

360

350

340

22 

370 

28 

25 

25 

22 

15 

16 

25 

383 

385 

387 

391 

399 

398 

404 

7%

6%

5%

4%

3%

2%

1%

0%

l

a
n
o
i
t
a
n
r
e
t
n

i

f
o
e
r
a
h
s

7
0
0
2

8
0
0
2

9
0
0
2

0
1
0
2

1
1
0
2

2
1
0
2

3
1
0
2

4
1
0
2

Domestic

International

Share of international traffic

Source: RMMS 

an 

Passenger  rail  demand  in  the 
EU  has 
increased  between 
2009  and  2014  by  30  billion 
passenger-kilometres, 
average 
representing 
growth rate of 1.5 % per year. 
The  largest  relative  increases 
were  observed  in  the  United 
Kingdom,  the  Czech  Republic 
and Luxembourg, while during 
the  same  period  in  Croatia 
traffic 
passenger 
reported 
halved.  About  only  6 %  of 
passenger  traffic  in  2014  was 
international  and  the  number 
international  passenger-
of 
kilometres  has  been  broadly 
constant since 2011. 

8 

The report of the European Court of Auditors ‘Rail freight transport in the EU: still not on the right 
track’. 

3 

 
 
 
 
                                                 
 
 
 
 
 
 
While traffic volumes have grown, 
the  modal share  of passenger rail 
in  land  transport  in  the  EU  has 
since 2009 shifted only by a half a 
percentage  point  from  7.1 %  to 
level 
7.5 %.  Behind 
average 
are  marked 
there 
differences  in  the  performance  of 
individual  Member  States  — 
the 
improvement 
strong 
in 
Netherlands 
the  United 
and 
Kingdom  and  decline  in  Latvia, 
Slovenia, Bulgaria and Croatia. 

this  EU 

Figure 2 – 

Passenger land transport modal split (%) 

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

10,0 

9,8 

9,4 

9.2 

83,1 

83,6 

83,6 

83,3 

6,9 

9
9
9
1

6,6 

4
0
0
2

7,1 

9
0
0
2

7,5 

4
1
0
2

Trains

Passenger cars

Coaches, buses and trolley buses

Source: Statistical pocketbook 2016, Eurostat 

Freight traffic 

Figure 3 – 

Evolution of rail freight traffic volumes 

s
e
r
t
e
m
o

l
i
k
-
e
n
n
o
t
n
o

i
l
l
i

b

500
450
400
350
300
250
200
150
100
50
0

231 

222 

178 

190 

208 

193 

211 

214 

218 

218 

187 

197 

221 

206 

203 

203 

52%

51%

50%

49%

48%

47%

46%

l

a
n
o
i
t
a
n
r
e
t
n

i

f
o
e
r
a
h
s

7
0
0
2

8
0
0
2

9
0
0
2

0
1
0
2

1
1
0
2

2
1
0
2

3
1
0
2

4
1
0
2

Domestic

International

Share of international

Source: RMMS 

in 

Outputs 
tonne-
in 
kilometres,  while  still  being 
7 % lower than the 2007 peak 
levels,  reached  417.6  billion 
tonne-kilometres 
2014 
showing 
average 
a  3 % 
annual  increase  rate.  More 
than 50 % of freight traffic in 
2014  was 
international, 
giving  rail  freight  a  much 
stronger  European  dimension 
than is the case for passenger 
traffic. 

transport, 

In  2014  the  modal  share  of  rail 
freight  in  inland  freight  transport 
was 18 %, which is almost the same 
to 
as  10  years  ago.  Similarly 
are 
passenger 
the 
widely  diverging 
Member  State  level:  the  increase 
being 
Slovenia, 
Romania  and  Hungary.  The  total 
tonne-kilometres  in  comparison  to 
2009 have declined only in Croatia, 
Slovakia, Greece and Estonia. 

there 
trends  at 

strongest 

in 

Figure 4 – 

Freight land transport modal split (%) 

100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%

6,5 

5,9 

5,9 

6,6 

74,0 

75,9 

77,5 

75,4 

19,5 

18,2 

9
9
9
1

4
0
0
2

16,6 

9
0
0
2

18,0 

4
1
0
2

Railways

Roads

Inland waterways

Source: Statistical pocketbook 2016, Eurostat 

4 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
4.  SERVICES TO RAILWAY UNDERTAKINGS 

The  Recast  Directive  introduced  a  set  of  new  rules  for  service  facilities  and  rail  related 
services  with  the  aim  to  improve  transparency  on  conditions  and  charges  applied  and  to 
ensure  non-discriminatory  access  for  operators.  The  market  of  service  facilities  (stations, 
freight terminals, marshalling yards, train formation facilities, maritime and inland ports, etc.) 
is characterised by a large number of different owners and operators of various sizes.  

Mapping and defining the facilities is an ongoing challenge for national regulatory bodies and 
for the Commission services. According to available RMMS data, in 2014 there were about:  

  30 000 passenger stations;  
  3600 freight terminals;  
  1700 marshalling yards;  
  28 500 storage sidings; 
  1300 maintenance facilities;  
  650 maritime and port facilities; and  
  650 refuelling facilities. 

5.  THE EVOLUTION OF FRAMEWORK CONDITIONS IN THE RAIL SECTOR 

5.1. Infrastructure charging 

The  EU  rail  legislation  aims  to  reduce  the  infrastructure  charges  at  the  best  possible 
infrastructure quality with a three-pronged approach. Firstly, the modalities of calculating the 
direct costs of infrastructure use, being the basis for the minimum access package, have been 
harmonised in the new Implementing Regulation (EU) 2015/9099. Secondly, mark-ups can be 
applied  on  top  of  the  direct  cost  charges  only  in  segments  being  able  to  pay  such  higher 
charges. Thirdly, the infrastructure managers are encouraged to exploit the incentives inherent 
in  certain  charging  components,  such  as  scarcity,  reservation,  possession,  environmental 
charges and performance schemes, to optimise the use of infrastructure. 

As a result of this and other factors, the level and approach to charging may vary both within 
the charging scheme of one infrastructure manager as well as between Member States.  

9 

Commission Implementing Regulation (EU) 2015/909 of 12 June 2015 on the modalities for the 
calculation of the cost that is directly incurred as a result of operating the train service (Text with EEA 
relevance) OJ L 148, 13.6.2015, p. 17. 

5 

 
 
 
                                                 
Figure 5 –  Track access charges for different categories of trains (EUR per train-km, applicable 201610) 

Freight charges higher 

Passenger charges higher, mixed or equal 

14

12

10

8

6

4

2

0

E
E

V
L

T
L

Z
C

L
N

O
R

L
P

K
S

K
U

U
H

R
H

I

G F
B

I

E S
S

E
D

S
E

E
B

R
F

T
A

T
I

U
L

T
P

K
D

O
N

Source: RMMS 
Notes: HR, DE 2014 charges, LV arithmetic mean of 2015 min/max charges, EL, IE no data 

Freight

Intercity

Suburban

Figure 5  illustrates  the  different  situations  in  Member  States.  In  most  Member  States 
charges  for  freight  trains  are  higher  than  for  passenger  trains,  but  in  Germany,  Spain, 
Belgium, France, Luxembourg and Portugal the situation is the other way around. In Austria, 
Italy,  Sweden  and  Denmark  there  are  no  big  differences  or  the  results  are  mixed.  Freight 
charges  in  the  Baltic  States  are  particularly  high,  which  is  to  some  extent  justified  due  to 
higher permitted axle-loads. The intercity charges in Belgium, Germany, Spain and France are 
relatively  high  because  these  include  the  charges  for  dedicated  high  speed  lines.  Suburban 
charges are most volatile (varying between EUR 0.17 in the United Kingdom and EUR 11.50 
in France) because their levels depend on national approaches to public service contracts and 
rail  financing.  In  France,  for  example,  the  regions  themselves  (rather  than  railway 
undertakings) pay the so-called ‘redevance d’access’ to the infrastructure manager for the rail 
services they provide under public service contracts. As regards the evolution of charges, the 
developments are mixed. 

5.2. Capacity allocation and infrastructure limitations 

In the United Kingdom, Luxembourg, Denmark, Austria, Belgium and Germany the network 
utilisation rates are about 60 % higher than the EU average. Beyond this, the Netherlands has 
by  far  the  most  saturated  network  running  about  50  000  train-kilometres  per  each  line-
kilometre per year. In all these Member States rail demand continues to increase. 

10 

In the current RMMS, the Member States report the applicable track access charges two years ahead.  

6 

 
 
 
                                                 
Figure 6 – 

Network utilisation rates (thousand train-km per line-km, 2014) and relative change since 
2009 

50

45

40

35

30

25

20

15

10

5

0

IE
DK
EE
SE
AT
NO
LU
IT
UK
NL
DE
BE
HU
Avg
LT
LV
FI
SI
PT
CZ
SK
ES
FR
BG
RO
PL
HR
EL

NL UK DK LU AT BE DE IT Avg CZ FR SI SE PT ES HU NO SK PL IE LV FI LT HR RO BG EE EL

-10%

0%

10%

Source: Eurostat and Statistical pocketbook 2016 (based on UIC, IRG annual market monitoring reports, national statistics 
and estimates) 

RMMS data for 2014 shows that 10 Member States had declared some parts of their network 
congested. To manage capacity in constrained conditions, infrastructure managers use scarcity 
charges  and  various  priority  rules.  The  Commission  has  specified  the  criteria  for  awarding 
and  amending  framework  agreements  to  ensure  optimal  use  of  infrastructure  in  an 
implementing regulation in 2016.11 

11 

Commission Implementing Regulation (EU) 2016/545 of 7 April 2016 on procedures and criteria 
concerning framework agreements for the allocation of rail infrastructure capacity, OJ L 94, 8.4.2016, 
p. 1. 

7 

 
 
 
 
 
 
 
 
                                                 
5.3. Infrastructure expenditure and funding 

Figure 7 – 

Evolution of infrastructure expenditure and 
proportion of maintenance and renewal 
expenditure 

e
r
u
t
i
d
n
e
p
x
E

50

45

40

35

30

25

20

15

10

5

0

80%

70%

60%

50%

40%

30%

20%

10%

0%

20.428 

16.779 

16.980 

9.726 

10.734 

10.272 

9.311 

13.166 

8.780 

8.836 

12.098 

11.339 

2011

2012

2013

2014

Enhancements
Renewal
Maintenance

s
l

a
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a
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S

in  2011 

Despite  a  popular  perception  of 
support, 
declining 
public 
infrastructure 
expenditure 
has  constantly  increased  from 
to 
EUR 29  billion 
EUR 45  billion  in  2014.  The 
maintenance  expenditure  has 
fluctuated,  while 
investment 
into  renewal  and  enhancements 
has  continuously  increased.  At 
least  EUR 7 billion  (or  16 %  of 
total  expenditure)  was  spent  on 
high  speed  lines.  Maintaining 
the existing network, in order to 
uphold 
and 
operational  performance  and  to 
ensure reliable  service,  presents 
a  constant  and  costly  challenge 
infrastructure 
to 
managers. 

safety 

many 

its 

Source: RMMS 

The 
infrastructure 
expenditure  was  highest  in  the 
United Kingdom and in France, where the infrastructure managers have to catch up with the 
years of under-investment having at the same time significant enhancements projects ongoing. 
In Germany, the infrastructure expenditure in 2014 also increased significantly. 

total 

The EU can co-finance or support rail investment projects through the Cohesion Fund, the 
European  Regional  Development  Fund,  the  Connecting  Europe  Facility,  the  European 
Investment Bank and the European Fund for Strategic Investments. More than EUR 33 billion 
in  grants  under  the  current  EU  financial  framework  (2014-2020)  has  been  allocated  to  rail 
investment. 

5.4. Prices and quality of passenger services 

Given the diversity of services and fares it is challenging to assess the  overall evolution of 
rail  prices  at  EU  level.  Fares  applied  to  passenger  services  vary  widely  across  Member 
States, ticket-types and booking horizons and are often regulated. 

8 

 
 
 
 
 
 
 
 
 
 
 
 
Figure 8 – 

Harmonised Index of Consumer Prices: rail transport 
compared to total transport  

rail 
fares  have 
Overall, 
increased 
relatively  more 
quickly  than  in  other  modes 
(see  Figure  8).  However, 
there  are  examples  where 
competition 
open 
(e.g.  in  Austria,  the  Czech 
Republic,  Germany, 
Italy 
and Sweden)  has  led to fare 
reduction on certain lines. 

access 

7%

6%

5%

4%

3%

2%

1%

)
4
1
0
2
-
5
0
0
2
(
e
t
a
r
h
t
w
o
r
g

l

Z
C

E
B

G
B

0%

-1%

-2%

a
u
n
n
a
d
n
u
o
p
m
o
C

Having 
comparable 
punctuality  data  across  the 
Member  States  remains  a 
challenge.  It  seems  that  the 
best  performing  Member 
States  have  small  passenger 
networks  or  low  network 
utilisation  rates.  Punctuality 
may  be  hardest  to  maintain 
on busy lines, particularly if they carry a mix of long-distance and regional passenger services 
and freight services. The punctuality of long-distance services tends to be worse than regional 
and  local  services.  Regarding  reliability,  in  western  or  central  European  Member  States  no 
more  than  3 %  of  regional  or  5 %  of  long-distance  services  were  cancelled  in  2014. 
Cancellation rates were higher in some eastern European Member States. 

Source: Steer Davies Gleave study Prices and Quality of Rail Passenger Services, 
analysis of Eurostat’s Harmonised Index of Consumer Prices 

O S
R

K F
S

8
2
U
E

O
N

U
H

R
H

K
U

K
D

E
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P

V
L

E
E

E
S

S
E

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P

L
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E
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I

I

Regarding  safety,  rail  remains  one  of  the  safest  modes  of  transport.  According  to  the 
European Union Agency for Railways (‘the Agency’) there were about 1000 rail fatalities in 
2014 in Europe. Railway safety continued to improve between 2010 and 2014, with fatalities, 
serious  injuries  and  significant  accidents  all  decreasing.  In  2013,  the  fatality  risk  for  a  rail 
passenger was 16 times lower than for a person travelling by car. 

5.5. Rail transport services covered by public service contracts 

More  than  two-thirds  of  passenger  services  in  2014  were  operated  under  public  service 
contracts,  used  mainly  to  serve  regional  and  suburban  lines.  In  most  Member  States  public 
service  obligation  related  compensation  per  train-kilometre  was  higher  than  EUR 5  and  the 
total support provided was around EUR 20 billion. The proportion of the fare-box revenue in 
total  revenue  differs  between  more  than  90 %  in  Lithuania,  the  Netherlands  and  the  United 
Kingdom and less than 20 % in Hungary. 

5.6. Licensing 

The number of active railway undertakings varied in 2014 between 323 in Germany and 
1 in Finland. Compared to 2013, the number of active railway undertakings was increasing in 
Poland,  France,  Germany  and  Hungary  and  had  slightly  decreased  in  Bulgaria  and  the 
Netherlands. 

9 

 
 
 
 
 
 
 
 
 
 
Fees  for  licensing  can  range  from  none  to  EUR  70 000,  depending  on  Member  State  and 
content of application.12 EU rail policies aim to:  

  curb the fees due for licensing; 
  speed up the time-to-licence;  
 
  ensure that accident cover is provided on market-conditions without discrimination.  

increase transparency of valid licences; and  

To that end, it adopted an implementing act on licensing in 2015.13 Furthermore, the Fourth 
Railway  Package  proposes  the  creation  of  a  one  stop  shop  as  a  digital  single  entry  point  in 
Europe  for  vehicle  authorisations  and  safety  certifications.  The  aim  is  to  simplify  the 
procedures  and  ensure  equal  treatment  for  applicants  across  Europe.  The  Agency  will  also 
have a greater role in the process becoming an EU-wide authority for safety certification. 

5.7. Degree of market opening and utilisation of access rights 

Opening of the rail freight market in 2007 coincided with the economic crisis hitting freight 
transport services hard in all modes. Given that there has been a steady increase in the market 
share of competing rail operators almost in all Member States, it seems that the new entrants 
have coped relatively better with the challenges of the crisis. On average the market share of 
competing  freight  operators  (15 %  in  2006)  had  more  than  doubled  by  2014.  At  the  end  of 
2014,  rail  freight  transport  was  100 %  in  the  hands  of  national  incumbent  still  in  Finland, 
Greece, Ireland, Lithuania and Luxembourg. 

Figure 9 –  Market share of competitors in the freight market (2014, % of tonne-kilometres) 

and evolution 2011-2014 (in percentage points)  

60%

50%

40%

30%

20%

10%

0%

BG
SE
CZ
BE
NO
HU
FR
IT
DE
AT
PL
NL
UK
SK
DK
ES
HR
SI
PT
FI
LU
LT
EL
IE
LV
EE
RO

SE UK BGNORO IT NL HU FR PL DE EE CZ BE DK LV AT ES PT SK SI HR IE EL LT LU FI

-20%

0%

20%

Source: RMMS, 2011- 2014 except SE (2010 data used for 2011), PT and SI (2012 data used for 2011), LU (2010 data used 
for 2011 and 2012 data for 2014), IT 2014 data from IRG Rail Annual Market Monitoring Report (2016) 

12 

13 

Impact assessment accompanying the proposal for a Regulation of the European Parliament and of the 
Council on the European Union Agency for Railways, SWD (2013) 8. 
Commission Implementing Regulation (EU) 2015/171 of 4 February 2015 on certain aspects of the 
procedure of licensing railway undertakings, OJ L 29, 5.2.2015, p. 3. 

10 

 
 
 
 
                                                 
Market  shares  of  competitors  in  passenger  markets  are  lower,  given  the  different  stage  of 
market opening, being well below 20 % in all Member States except in Poland and the United 
Kingdom. Open access competition has developed in Austria, the Czech Republic, Germany, 
Italy, Slovakia, Sweden and the United Kingdom, with different degrees and results. At least 
in 15 Member States competing operators have entered the rail passenger markets. 

Figure 10 –  Market share of competitors in the passenger market (2014, % of p-km) 

and evolution 2011-2014 (in percentage points)  

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

PL
AT
CZ
FR
SK
RO
IT
DE
HU
PT
LV
FI
SI
LU
LT
HR
ES
EL
IE
BG
UK
DK
BE
NO
EE

EE -52 pp 

UK PL IT DE AT LV NO RO PT DK CZ EE FR SK HU BE BG IE EL ES HR LT LU SI FI

-10%

0%

10%

Source: RMMS, 2011-2014, except for IE (2013 data used for 2014), PT (2012 data used for 2011), LU (estimates) IT data 
from IRG Rail Annual Market Monitoring Report (2016); NL and SE confidential. 

5.8. Development of employment and social conditions 

According  to  the  RMMS,  at  the  end  of  2014  about  900 000  people  were  employed  by  rail 
operators  and  infrastructure  managers,  the  number  of  employees  decreased  by  4 %  between 
2009 and 2014. The workforce is predominately male and the proportion of workers over 40 
is  in  many  companies  more  than  50 %.  Ageing  is  a  particular  concern  in  Spain,  Greece, 
Finland  and  Italy.14  On  the  positive  side,  after  long  recruitment  freezes,  rail  companies  in 
many Member States have recently begun to recruit again. Secure employment, good salaries 
and  career  opportunities  under  positive  corporate  climate  are  today  the  most  common 
elements referred to in Member States where the sector is considered attractive. 

5.9. Funding of the railways and barriers to more effective rail services 

The overall cost of the rail operations and infrastructure management in the EU in 2012 was 
around EUR 110 billion, of which 60 % was covered by passenger and freight revenue, 30 % 
by  public  subsidies  to  operations  and  network  management,  and  the  remainder  by  other 
sources  of  income.15  On  average,  the  split  between  infrastructure  and  operator  costs  in 
national rail systems is approximately 30 %:70 %. Rolling stock fleet for both passenger and 
freight has been  in  decline since  2009. Passenger revenue has  increased significantly, while 
total operating costs have remained broadly static in real terms. 

14 
15  

UIC (2012). 
Steer Davies Gleave analysis, 2014 data not available. 

11 

 
 
 
 
                                                 
While  almost  everywhere  the  rail  sector  relies  on  public  investment,  the  way  funds  are 
channelled, differs following two principal funding models.16 Some countries (e.g. the United 
Kingdom,  Switzerland, 
to 
infrastructure  managers  and  keep  access  charges  low.  Others  (e.g.  France,  Belgium,  and 
Germany)  primarily  subsidise  transport  services  through  public  service  contracts,  while  the 
infrastructure managers adopt higher access charges. 

the  Netherlands,  and  Sweden)  allot  subsidies  primarily 

It  is  evident  that  the  railway  business  is  complex  and  multidimensional  and  comparison 
between  national  systems  is  often  not  meaningful.  Nevertheless,  there  seems  to  be  a  broad 
consensus  that  the  European  railways  have  issues  with  cost,  quality  of  services  and  market 
share. In most Member States various indicators are already used to monitor rail performance 
(e.g. in contractual agreements, performance schemes, public service contracts). However the 
challenge ahead is to agree, based on the sector’s proposals, on harmonised measures across 
the  EU.  To  this  end  several  initiatives  have  been  undertaken  by  the  sector  organisations  in 
cooperation  with  Commission  services  to  measure  and  benchmark  performance  (e.g.  best 
practice  benchmarking  undertaken  by  PRIME17  and  performance  monitoring  in  rail  freight 
corridors with the assistance of RailNetEurope). 

6.  IMPLEMENTATION OF THE LEGAL AND INSTITUTIONAL FRAMEWORK 

As the final element of the rail market report, Article 15(4) of the Recast Directive requires 
the  Commission  to  report  on  the  need  for  further  legislation.  Accordingly,  this  section 
summarises  the  ongoing  and  planned  Commission  regulatory  initiatives  in  the  rail  sector 
based on the analysis carried out in this report and its accompanying staff working document. 

Over  the  past  two  decades,  the  European  legislator  has  considerably  developed  the  EU  rail 
acquis  encouraging  competitiveness  and  market  opening.  The  overarching  idea  has  been 
that  greater  competition  makes  for  a  more  efficient  and  customer-responsive  industry.  In 
parallel  measures  have  been  taken  to  improve  the  interoperability  and  safety  of  national 
networks  and  to  encourage  the  development  of  an  integrated  rail  system  leading  to  a  single 
European rail area, as outlined in the 2011 transport white paper.18 

With the adoption and implementation of the Fourth Railway Package the period of structural 
changes in the railway sector should be concluded. The technical pillar of the Fourth Railway 
Package,  which  reviewed  and  optimised  the  regulatory  framework  on  interoperability  and 
safety and strengthened the role of the Agency, has been already adopted. The market pillar, 
safeguarding  independence  of  rail  infrastructure  managers  and  increasing  openness  of  the 
markets for domestic passenger services, is expected to be approved by the co-legislators by 
the end of 2016. 

There  have  been  positive  developments  in  the  rail  market,  such  as  increased  passenger 
volumes and investment in infrastructure as well as gradual opening of national rail markets. 
It is nonetheless clear that at the current pace it will not be possible to reach the objectives set 
for rail sector in the 2011 transport white paper. Furthermore, the European Court of Auditors 

16  

17 

18 

Issue Paper Solid Infrastructure Financing for an Efficient Rail System, http://www.inno-v.nl/wp-
content/uploads/2015/03/24022015-Issue-Paper-pour-envoi.pdf. 
Platform of European Rail Infrastructure managers. 
https://webgate.ec.europa.eu/multisite/primeinfrastructure/en. 
White paper Roadmap to a Single European Transport Area — Towards a competitive and resource 
efficient transport system (COM(2011) 144). 

12 

 
 
                                                 
notes  in  its  report  ‘Rail  freight  transport  in  the  EU:  still  not  on  the  right  track’19  that  the 
performance  of  rail  freight  transport  in  the  EU  remains  unsatisfactory.  Market  opening  has 
achieved uneven progress and a single European railway area is still a long way from being 
achieved. 

In  this  context  the  focus  of  the  Commission  in  the  coming  years  will  be  on  the 
implementation  of  existing  legislation  designed  to  bring  about  the  desired  performance 
improvements.  The  transposition  and  implementation  of  the  Recast  Directive  is  in  its  final 
stages, while the preparations for implementation of the technical pillar of the Fourth Railway 
Package  have  been  launched.  The  Commission  services  work  closely  with  the  Agency, 
Member States,  national regulatory  bodies and rail  stakeholders through forums such as  the 
European  Network  of  Rail  Regulatory  Bodies,  PRIME  and  RU  Dialogue  to  ensure  that  the 
Union legislation is implemented in the most efficient way and is understood by the sector. 

The  Commission  services  continue  preparations  for  the  implementing  act  on  access  to 
services  and  service  facilities  (Article  13  of  the  Recast  Directive),  the  delegated  act  on 
scheduling rules (Annex VII of the Recast Directive), and have launched the revision of the 
Technical Specification of Interoperability on Noise,20 Rail Passenger Rights Regulation21 and 
the Combined Transport Directive.22 In addition, the ongoing evaluations of the Rail Freight 
Regulation23  and  Train  Drivers  Directive24  may  lead  to  updates  of  these  acts  in  the  coming 
years. 

Finally,  there  are  ongoing  actions  addressing  the  challenges  faced  by  the  sector,  including 
implementation of the TEN-T Guidelines, deployment of European Rail Traffic Management 
System,  securing  funding  and  financing  for  rail 
infrastructure  projects,  embracing 
opportunities  provided  by  digital  technologies  and  launching  projects  under  Shift2Rail. 
Furthermore, the Commission services continue to engage with the sector in the areas of rail 
security,  multimodality  and  a  level  playing  field  across  the  modes,  including  effective 
application of user pays/polluter pays principles. 

19 
20 

21 

22 

23 

24 

http://www.eca.europa.eu/en/Pages/NewsItem.aspx?nid=6971. 
Commission  Regulation  (EU)  No 1304/2014  of  26 November  2014  on  the  technical  specification  for 
interoperability relating to the subsystem ‘rolling stock — noise’, OJ L 356, 12.12.2014, p. 421. 
Regulation (EC) No 1371/2007 of the European Parliament and of the Council of 23 October 2007 on 
rail passengers’ rights and obligations, OJ L 315, 3.12.2007, p. 14. 
Directive 92/106/EEC of 7 December 1992 on the establishment of common rules for certain types of 
combined transport of goods between Member States, OJ L 368, 17.12.1992, p. 38. 
Regulation  (EU)  No 913/2010  of  the  European  Parliament  and  of  the  Council  of  22 September  2010 
concerning a European rail network for competitive freight, OJ L 276, 20.10.2010, p. 22. 
Directive  2007/59/EC  of  the  European  Parliament  and  of  the  Council  of  23 October  2007  on  the 
certification of train drivers operating locomotives and trains on the railway system in the Community, 
OJ L 315, 3.12.2007, p. 51. 

13