CELEX: 62010CC0545
Language: en
Date: 2012-12-13 00:00:00
Title: Opinion of Mr Advocate General Jääskinen delivered on 13 December 2012. # European Commission v Czech Republic. # Failure of a Member State to fulfil obligations - Transport - Directive 91/440/EEC - Development of the Community’s railways - Article 10(7) - Regulatory body - Competences - Directive 2001/14/EC - Allocation of railway infrastructure capacity - Article 4(1) - Charging framework - Article 6(2) - Measures intended to provide the infrastructure manager with incentives to reduce the costs of provision of infrastructure and the level of access charges - Article 7(3) - Setting charges for the minimum access package and track access to service facilities - Cost directly incurred as a result of operating the railway service - Article 11 - Performance scheme - Article 30(5) - Regulatory body - Competence - Administrative appeal against the decisions of the regulatory body. # Case C-545/10.

OPINION OF ADVOCATE GENERAL
      JÄÄSKINEN
      delivered on 13 December 2012 (
            1
         )
      Case C-545/10
      European Commission
      v
      
         Czech Republic
      
      ‛Action for failure to fulfil obligations — Directive 91/440/EEC — Development of the Community’s railways — Directive 2001/14/EC — Allocation of railway infrastructure capacity — Article 4(1) of Directive 2001/14 — Laying down a maximum amount for charges for the use of railway infrastructure — Article 6(2) of Directive 2001/14 — Adoption of measures providing managers with incentives to reduce the costs of provision of infrastructure and the level of access charges — Article 7(3) of Directive 2001/14 — Setting of charges for the minimum access package and track access to service facilities — Cost that is directly incurred as a result of operating the train service — Marginal cost — Article 11 of Directive 2001/14 — Absence of a performance scheme — Article 30(5) of Directive 2001/14 — Regulatory body — Competences — Administrative appeal to the Ministry of Transport — Article 10(7) of Directive 91/440 — Regulatory body — Competences’
      I – Introduction
      
      
               1.
            
            
               By its action for failure to fulfil obligations, the Commission asks the Court to declare that the Czech Republic has failed to fulfil its obligations under Article 4(1), Article 6(2) Article 7(3), Article 11 and Article 30(5) of Directive 2001/14/EC, (
                     2
                  ) as amended by Directive 2007/58/EC (
                     3
                  ) (‘Directive 2001/14’) and Article 10(7) of Directive 91/440/EEC, (
                     4
                  ) as amended by Directive 2001/12/EC (
                     5
                  ) (‘Directive 91/440’). The Czech Republic contends that the Commission’s action should be dismissed.
            
         
               2.
            
            
               This action is one in a series of infringement proceedings (
                     6
                  ) brought by the Commission in 2010 and 2011 concerning the application by Member States of Directives 91/440 and 2001/14, the main object of which is to ensure equitable and non-discriminatory access for railway undertakings to infrastructure, that is to say, the rail network. Those actions break new ground since they provide the Court with its first opportunity to examine the liberalisation of railways within the European Union and, inter alia, to interpret what is known as ‘the first railway package’.
            
         
               3.
            
            
               On 6 September 2012 I delivered my Opinions in Case C-557/10 Commission v Portugal and Cases C-473/10 Commission v Hungary; C-483/10 Commission v Spain; C-555/10 Commission v Austria and C-556/10 Commission v Germany. In addition to this Opinion, today I will deliver my Opinion in Commission v Poland; Commission v France; Commission v Slovenia and Commission v Luxembourg. In so far the present case concerns similar complaints to those which I have already examined in those Opinions, I will simply make reference to the relevant points of the Opinions, without reproducing in full the arguments set out therein.
            
         II – Legal framework
      
      A – EU legislation
      
      1. Directive 91/440
      
               4.
            
            
               Article 10(7) of Directive 91/440 provides:
               ‘Without prejudice to Community and national regulations concerning competition policy and the institutions with responsibility in that area, the regulatory body established pursuant to Article 30 of Directive 2000/14/EC, or any other body enjoying the same degree of independence shall monitor the competition in the rail services markets, including the rail freight transport market.
               That body shall be set up in accordance with the rules in Article 30(1) of the said Directive. Any applicant or interested party may lodge a complaint with this body if it feels that it has been treated unjustly, has been the subject of discrimination or has been injured in any other way. On the basis of the complaint and, where appropriate, on its own initiative, the regulatory body shall decide at the earliest opportunity on appropriate measures to correct undesirable developments in these markets. In order to ensure the necessary possibility of judicial control and the requisite cooperation between national regulatory bodies, Article 30(6) and Article 31 of the said Directive shall apply in this context.’
            
         2. Directive 2001/14
      
               5.
            
            
               Recital 11 in the preamble to Directive 2001/14 states:
               ‘The charging and capacity allocation schemes should permit equal and non-discriminatory access for all undertakings and attempt as far as possible to meet the needs of all users and traffic types in a fair and non-discriminatory manner.’
            
         
               6.
            
            
               Article 4(1) of that directive provides:
               ‘Member States shall establish a charging framework while respecting the management independence laid down in Article 4 of Directive 91/440/EEC.
               Subject to the said condition of management independence, Member States shall also establish specific charging rules or delegate such powers to the infrastructure manager. The determination of the charge for the use of infrastructure and the collection of this charge shall be performed by the infrastructure manager.’
            
         
               7.
            
            
               Under Article 6(2) and (3) of Directive 2001/14:
               ‘2.   Infrastructure managers shall, with due regard to safety and to maintaining and improving the quality of the infrastructure service, be provided with incentives to reduce the costs of provision of infrastructure and the level of access charges.
               3.   Member States shall ensure that the provision set out in paragraph 2 is implemented, either through a contractual agreement between the competent authority and infrastructure manager covering a period of not less than three years which provides for State funding or through the establishment of appropriate regulatory measures with adequate powers.’
            
         
               8.
            
            
               Article 7(3) of that directive states:
               ‘Without prejudice to paragraphs 4 or 5 or to Article 8, the charges for the minimum access package and track access to service facilities shall be set at the cost that is directly incurred as a result of operating the train service.’
            
         
               9.
            
            
               Under Article 11 of Directive 2001/14:
               ‘1.   Infrastructure charging schemes shall through a performance scheme encourage railway undertakings and the infrastructure manager to minimise disruption and improve the performance of the railway network. This may include penalties for actions which disrupt the operation of the network, compensation for undertakings which suffer from disruption and bonuses that reward better than planned performance.
               2.   The basic principles of the performance scheme shall apply throughout the network.’
            
         
               10.
            
            
               Article 30(2) and (3) of that directive provides:
               ‘2.   An applicant shall have a right to appeal to the regulatory body if it believes that it has been unfairly treated, discriminated against or is in any other way aggrieved, and in particular against decisions adopted by the infrastructure manager or where appropriate the railway undertaking concerning:
               
                        (a)
                     
                     
                        the network statement;
                     
                  
                        (b)
                     
                     
                        criteria contained within it;
                     
                  
                        (c)
                     
                     
                        the allocation process and its result;
                     
                  
                        (d)
                     
                     
                        the charging scheme;
                     
                  
                        (e)
                     
                     
                        level or structure of infrastructure fees which it is, or may be, required to pay;
                     
                  
                        (f)
                     
                     
                        arrangements for access in accordance with Article 10 of … Directive [91/440] as amended by Directive 2004/51/EC of the European Parliament and of the Council of 30 April 2004 amending … Directive [91/440] (OJ 2004 L 164, p. 164).
                     
                  3.   The regulatory body shall ensure that charges set by the infrastructure manager comply with chapter II and are non-discriminatory. Negotiation between applicants and an infrastructure manager concerning the level of infrastructure charges shall only be permitted if these are carried out under the supervision of the regulatory body. The regulatory body shall intervene if negotiations are likely to contravene the requirements of this Directive.’
            
         
               11.
            
            
               Article 30(5) and (6) of that directive provides:
               ‘5.   The regulatory body shall be required to decide on any complaints and take action to remedy the situation within a maximum period of two months from receipt of all information.
               Notwithstanding paragraph 6, a decision of the regulatory body shall be binding on all parties covered by that decision.
               In the event of an appeal against a refusal to grant infrastructure capacity, or against the terms of an offer of capacity, the regulatory body shall either confirm that no modification of the infrastructure manager’s decision is required, or it shall require modification of that decision in accordance with directions specified by the regulatory body.
               6.   Member States shall take the measures necessary to ensure that decisions taken by the regulatory body are subject to judicial review.’
            
         B – National legislation
      
      1. Law on railways
      
               12.
            
            
               Law No 266/1994 Sb. on railways (zákon č. 266/1994 Sb., o dráhách), as amended (‘the Law on railways’), establishes the operating conditions for railways and rail transport and the related rights and obligations of natural and legal persons.
            
         
               13.
            
            
               Under Article 34c of the Law on railways:
               ‘National and regional network statement
               (1)   The capacity allocation body shall, after consulting the railway manager, draw up the rail network statement, no later than 12 months after the entry into force of the service timetable, and publish it in the Transport and Charges Bulletin.
               (2)   The rail network statement shall show:
               …
               
                        (f)
                     
                     
                        the conditions for the withdrawal of allocated but unused or partially used infrastructure capacity, including information on charging for allocated and unused transport capacity;
                     
                  
                        (g)
                     
                     
                        information on charging for the allocation of infrastructure capacity and on the setting of charges for the use of infrastructure;
                     
                  …’
            
         
               14.
            
            
               Article 34g of the Law on railways provides:
               ‘1.   An applicant for the allocation of railway infrastructure capacity may make a request to the Office for Railways, within 15 days of publication of the rail network statement, for its review, including criteria contained within it.
               2.   An applicant for the allocation of railway infrastructure capacity whose application has not been granted by the allocation body shall have the right, in accordance with the procedure referred to in Article 34e, to make a request to the Office for Railways, within 15 days of notification of the statement referred to in Article 34e(4), for review of the process for the allocation of railway infrastructure capacity, including its impact and the method used to set prices.
               3.   If the Office for Railways finds that an incorrect procedure was followed in the preparation of the network statement, including criteria contained within it, or in the process for the allocation of railway infrastructure capacity, including its result and the method used to set prices, it shall decide to amend that statement, including criteria contained within it, or it shall decide on an allocation of that capacity, in particular the method used to set prices.’
            
         
               15.
            
            
               Under Article 56(c) of the Law on railways, the Ministry of Transport is ‘the appellate body in administrative procedures, for matters governed by the present law, brought against decisions of the Office for Railways, the Rail Inspectorate and the municipalities’.
            
         2. Law on prices
      
               16.
            
            
               Law No 526/1990 Sb. on prices (zákon č. 526/1990 Sb., o cenách), as amended (‘the Law on prices’), concerns the application, regulation and monitoring of prices for products, supplies, works and services for the national market.
            
         
               17.
            
            
               Under Article 10(2) of the Law on prices:
               ‘The provisions on price regulation referred to in paragraph 1 shall be published by the Ministry of Finance in the Official Price Bulletin … They shall be published in the Official Journal in accordance with special legal provisions. … The decision on prices shall become valid on the date of its publication in the relevant official bulletin and shall enter into force on the date specified therein, but no later than the date of its publication.’
            
         
               18.
            
            
               Under Article 10(2) of the Law on prices, the Ministry of Finance must publish a decision (‘Výměr’) which lists items whose prices are regulated. The Ministry of Finance must publish that decision every year in the official price bulletin. This sets the maximum price for the use of internal railway infrastructure, both national and regional, for rail transport operation.
            
         3. Law on the State Transport Infrastructure Fund
      
               19.
            
            
               Law No 104/2000 Sb. on the State Transport Infrastructure Fund (Zákon č. 104/2000 Sb. o Státním fondu dopravní infrastruktury), as amended (‘the Law on the State Transport Infrastructure Fund’), regulates the activities of that Fund and the use of its loans for railway infrastructure development, construction, maintenance and modernisation.
            
         
               20.
            
            
               Under Article 2 of the Law on the State Transport Infrastructure Fund:
               ‘The Fund shall earmark its revenue for the development, construction, maintenance and modernisation of roads and motorways, railways and navigable waters as follows:
               …
               
                        (c)
                     
                     
                        financing for the construction, modernisation, repair and maintenance of national and regional railways,
                     
                  …
               
                        (f)
                     
                     
                        the grant of loans for preparatory works or projects, studies or expert reports on the construction, modernisation or repair of roads and motorways and waterways which are important to transport and the construction national or regional railways, …’.
                     
                  
         4. Decree No 501/2005 Sb.
      
               21.
            
            
               Decree No 501/2005 Sb. fixes the expenses borne by the railway manager in connection with the use and operation, modernisation and development of railways (vyhláška no 501/2005 Sb., o vymezení nákladů provozovatele dráhy spojených s provozováním a zajišťováním provozuschopnosti, modernizace a rozvoje železniční dopravní cesty).
            
         5. Law on the competences of the Office for the Protection of Competition
      
               22.
            
            
               Law No 273/1996 Sb. on the competences of the Office for the Protection of Competition (zákon č. 273/1996 Sb., o působnosti Úřadu pro ochranu hospodářské soutěže), as amended (‘the Law on the competences of the Office for the Protection of Competition’), defines inter alia the areas falling within the competence of that Office.
            
         
               23.
            
            
               Under Article 2 of that Law, the Office for the Protection of Competition shall:
               
                        ‘(a)
                     
                     
                        create conditions for the promotion and maintenance of competition;
                     
                  
                        (b)
                     
                     
                        monitor public procurement;
                     
                  
                        (c)
                     
                     
                        exercise other competences as defined by special laws.’
                     
                  
         6. Law on the protection of competition
      
               24.
            
            
               The Office for the Protection of Competition performs the activities laid down in Law No 143/2001 Sb. on the protection of competition (zákon č. 143/2001 Sb., o ochraně hospodářské soutěže a o změně některých zákonů), as amended (‘the Law on the protection of competition’).
            
         
               25.
            
            
               Under Article 1(1) of the Law on the protection of competition:
               ‘it shall organise the protection of competition on the market for products and services … against any practice which prevents, restricts, distorts or threatens competition through
               
                        (a)
                     
                     
                        agreements between competitors;
                     
                  
                        (b)
                     
                     
                        abuse of a dominant position by competitors, or
                     
                  
                        (c)
                     
                     
                        a concentration between competing undertakings.’
                     
                  
         III – The pre-litigation procedure and the procedure before the Court
      
      
               26.
            
            
               On 10 May 2007, Commission staff sent a questionnaire to the Czech authorities in order to verify the transposition by the Czech Republic of Directives 91/440 and 2001/14. That Member State replied by letter of 11 July 2007.
            
         
               27.
            
            
               On 27 June 2008, on the basis of the information communicated by the Czech Republic, the Commission gave that Member State formal notice requiring it to comply with Directives 91/440 and 2001/14 and, in particular, the provisions of those directives relating to charges for the use of railway infrastructure and the provisions relating to the regulatory body.
            
         
               28.
            
            
               On the basis of the information passed on to it by the Czech Republic, the Commission concluded that the objections raised in its letter of formal notice had not been refuted and, by letter of 9 October 2009, sent a reasoned opinion to the Czech Republic.
            
         
               29.
            
            
               In that reasoned opinion, the Commission complained that the Czech Republic had failed to fulfil its obligations under Article 4(1), Article 6(2), Article 7(3), Article 11 and Article 30(5) of Directive 2001/14 and Article 10(7) of Directive 91/440. It therefore requested that the Czech Republic take the measures necessary to comply with the reasoned opinion within two months of its notification.
            
         
               30.
            
            
               The Czech Republic responded to the reasoned opinion by letter of 8 December 2009, disputing any infringement of the provisions mentioned in the reasoned opinion.
            
         
               31.
            
            
               In those circumstances, the Commission brought the present action on 23 November 2010.
            
         
               32.
            
            
               By order of the President of the Court of 11 July 2011, the Kingdom of Spain was granted leave to intervene in support of the forms of order sought by the Czech Republic.
            
         
               33.
            
            
               The Commission and the Czech Republic were represented at the hearing, which took place on 20 September 2012.
            
         IV – Pleas and arguments of the parties
      
      A – The first complaint concerning the laying down of a maximum amount for charges for the use of railway infrastructure
      
      1. Arguments of the parties
      
               34.
            
            
               The Commission claims that the Czech Republic has infringed Article 4(1) of Directive 2001/14 by laying down a maximum amount for charges for the use of railway infrastructure. It argues that under that provision the right enjoyed by the Member State to establish a charging framework for the use of railway infrastructure must respect the infrastructure manager’s right to determine and collect the charge. However, the determination, by an annual decision of the Ministry of Finance, of a maximum charge for the use of railway infrastructure, pursuant to Article 10(2) of the Law on prices, goes beyond the charging framework and the rules which the Member States are authorised to define under Article 4(1) of Directive 2001/14.
            
         
               35.
            
            
               The Czech Republic takes the view that the literal and schematic interpretation of Article 4(1) of Directive 2001/14 advocated by the Commission is insufficient and argues that the teleological method should be used. According to that Member State, the need to eliminate the negative effects of the monopoly contributes to the general objective of Directive 2001/14, which is why that directive specifically gives the Member States competence to establish a charging framework or system. In addition, the setting of a maximum price does not mean that the infrastructure manager is not able to determine the amount of the charges himself.
            
         
               36.
            
            
               The Kingdom of Spain essentially argues that the laying down of a maximum amount does not prevent the infrastructure manager from specifically establishing the charges.
            
         2. Examination of the first complaint
      
               37.
            
            
               I would point out, first of all, that the Commission’s first complaint deals with the same issue as the first complaint in Case C-483/10 Commission v Spain. Even though the Minister of Finance in the Czech Republic lays down only a maximum charge whereas in Spain the amount of the charges is set entirely by ministerial decree in such a way that only the collection of charges is the responsibility of the infrastructure manager, I think that the legal arguments set out in that Opinion also apply, mutatis mutandis, to the Czech Republic. (
                     7
                  )
            
         
               38.
            
            
               In that case I concluded that, in order to achieve the objective of management independence, only the normative and financial framework may be laid down by the State. Such a framework may include general charging rules and also, subject to the condition of management independence, specific rules. In my view, such a State framework may also define financial objectives of infrastructure management as regards different forms of rail traffic, for example. As regards the respective infrastructure costs generated by the different forms of rail traffic (such as rail freight, long-distance passenger transport or local public transport), the State may define variable thresholds, for each type of traffic, which managers are required to accept. (
                     8
                  ) However, State price regulation involving laying down maximum charges does not seem to be in keeping with management independence.
            
         
               39.
            
            
               In accordance with Article 30(2)(e) of Directive 2001/14, the regulatory body must monitor the level and structure of infrastructure fees. It is true that the Ministry responsible for transport matters may be entrusted with the regulatory body’s task. However, that is not the case in the Czech Republic. Laying down, by an annual decision of the Ministry of Finance, a maximum charge for the use of railway infrastructure pursuant to Article 10(2) of the Law on prices cannot, a fortiori, be regarded as the correct transposition of that provision of Directive 2001/14, which concerns the competences of the regulatory body.
            
         
               40.
            
            
               The Czech Republic’s argument concerning the need to avoid the monopoly position held by the infrastructure manager resulting in the setting of excessive charges for all carriers also cannot be accepted. Under Article 10(7) of Directive 91/440, the regulatory body established pursuant to Article 30 of Directive 2000/14, or any other body enjoying the same degree of independence must monitor the competition in the rail services markets, including the rail freight transport market. In the Czech Republic that task has been entrusted to the Office for the Protection of Competition. The monitoring of maximum charges by the Ministry of Finance does not therefore comply with that provision.
            
         
               41.
            
            
               It should be added that the Court’s judgment in Mobistar, (
                     9
                  ) relied on by the Czech Republic, also does not support that Member State’s position. In that judgment, the Court confirmed that Article 30(2) of Directive 2002/22 (
                     10
                  ) does not preclude the adoption of a national measure laying down the specific method to be used in calculating costs and which fixes in advance and on the basis of an abstract model of the costs maximum prices which may be charged by the donor operator to the recipient operator as set-up costs, provided that the prices are fixed on the basis of the costs in such a way that consumers are not dissuaded from making use of the facility of portability. However, that judgment concerns the interpretation of a Community provision in a different regulatory framework whose objective and wording are not the same as those of Article 4(1) of Directive 2001/14.
            
         
               42.
            
            
               On these grounds I propose that the Court uphold the Commission’s first complaint.
            
         B – The second complaint concerning the absence of measures providing infrastructure managers with incentives to reduce the costs of provision of infrastructure and the level of access charges
      
      1. Arguments of the parties
      
               43.
            
            
               The Commission claims that the Czech Republic has infringed Article 6(2) of Directive 2001/14 by failing to adopt measures providing infrastructure managers with incentives to reduce the costs of provision of infrastructure and the level of access charges. In its view, the incentives system provided for in that provision requires a direct link between the grant of financial resources and the conduct of the infrastructure manager, who reduces the costs of provision of infrastructure and the level of access charges. In this regard, the Commission argues that the financial resources granted by the State Transport Infrastructure Fund in no way constitute incentives for the infrastructure manager to reduce costs or the amount of charges.
            
         
               44.
            
            
               The Czech Republic submits that the role conferred on the State by Article 6(2) of Directive 2001/14, namely to provide infrastructure managers with incentives to reduce the costs of provision of infrastructure and the level of access charges, is not unconditional. That provision defines the objective to be attained by the Member States, in the form of a result which can be fully realised only after achieving sufficient quality and safety levels for the railway infrastructure across the entire network or the majority of it. In view of the current state of the railway infrastructure in the Czech Republic, the system required by that provision cannot be fully established without at the same time creating a threat to the safety or the service quality of the infrastructure in question.
            
         
               45.
            
            
               The Czech Republic claims that, in any event, the incentives referred to in Article 6(2) of Directive 2001/14 are currently created through the State Transport Infrastructure Fund. The majority of railway maintenance costs is covered by subsidies granted by the State through the Fund; without those subsidies, the amount of the charges for the use of infrastructure would be several times higher.
            
         
               46.
            
            
               According to the Kingdom of Spain, it is not reasonable to reduce access charges without first modernising the rail network, and thus reducing maintenance costs. Furthermore, that Member State claims that Article 6 of Directive 2001/14 is linked to the need for the infrastructure manager to balance his accounts without State financing.
            
         2. Examination of the second complaint
      
               47.
            
            
               It should be noted at the outset that the Commission’s second complaint in the present case, which concerns the absence of measures providing infrastructure managers with incentives to limit the costs connected with the infrastructure service or the level of access charges is essentially identical to the third complaint in Case C-556/10 Commission v Germany, and the third complaint in Case C-512/10 Commission v Poland, in which I will deliver my Opinions on the same dates as the Opinion in the present case. (
                     11
                  ) For that reason I refer to the legal reasoning followed in those Opinions.
            
         
               48.
            
            
               As regards the Czech legislation and its implementation, there are, however, significant differences compared with the situation in Germany, and, to a lesser extent, the situation in Poland. Consequently, the examination of the substance of the Commission’s complaint must take account of the specific situation in the Czech Republic.
            
         
               49.
            
            
               Under Article 6(2) of Directive 2001/14, infrastructure managers must, with due regard to safety and to maintaining and improving the quality of the infrastructure service, be provided with incentives to reduce the costs of provision of infrastructure and the level of access charges. Unlike the provision made under Article 11 of the directive with regard to rail network performance improvement, Article 6(2) of that directive does not require the incentives to form a ‘scheme’. (
                     12
                  )
            
         
               50.
            
            
               However, Article 6(3) of Directive 2001/14 envisages two distinct possibilities for implementing the obligation set out in paragraph 2 of that article. It must be done either through a multiannual agreement between the infrastructure manager and the competent authority which provides for State funding or through the establishment of appropriate regulatory measures with adequate powers. However, even if measures taken in isolation could be regarded as incentives, they cannot represent measures within the meaning of Article 6(2) if they do not come within the framework of one of the two possibilities defined in paragraph 3.
            
         
               51.
            
            
               It would seem that the Czech Republic does not claim that it acted, with a view to the adoption of incentives, in accordance with Article 6(3) of Directive 2001/14 and, a fortiori, in such a way as to comply with the obligation under paragraph 2 of that provision.
            
         
               52.
            
            
               It should be added that simply providing the infrastructure manager with State funding, as mentioned by the Czech Republic, is certainly liable to entail a reduction of costs and charges, but this does not in itself constitute an incentive within the meaning of Article 6(2) of Directive 2001/14. An incentive is a measure which encourages the infrastructure manager to reduce costs or indeed charges, i.e. which results in certain conduct on the part of the manager. For that reason, the conditions for State funding or the structure of the framework for its provision can be regarded as incentives. In contrast, the same does not hold for the simple existence of funding.
            
         
               53.
            
            
               With regard to the argument put forward by the Czech Republic concerning the deterioration of the railway infrastructure, it is sufficient to note that the Member States’ obligations under Article 6(2) of Directive 2001/14 are not dependent on such a circumstance. That being said, it is equally clear that the choice of incentives to be adopted, and more particularly the specific objectives pursued by the Member State through these measures, must have due regard to safety and the quality level of the infrastructure service, which are expressly mentioned in that paragraph.
            
         
               54.
            
            
               In this regard, I would add that the objective of the incentives is to maintain economic efficiency in managing the dangers of inefficiency which are inherent in natural monopolies. (
                     13
                  ) In my view, the deterioration of the infrastructure does not rule out a variation in management efficiency and, in particular, the adoption of incentives for the manager. By taking such measures, a Member State seeks to ensure that the infrastructure manager’s costs correspond to those of an efficiently managed infrastructure and that those costs do not include unnecessary costs attributable to poor organisation or management by the infrastructure manager. Thus, whilst the Member States must take into account the state of the infrastructure for the purposes of the application of Article 6(2) of Directive 2001/14, this does not exonerate them from the obligation to adopt incentives like those mentioned in that provision.
            
         
               55.
            
            
               In the light of the foregoing, I propose that the Court also uphold the Commission’s second complaint.
            
         C – The third complaint concerning the fact that charges for the minimum access package and track access to service facilities are not set at the cost that is directly incurred as a result of operating the train service
      
      1. Arguments of the parties
      
               56.
            
            
               The Commission claims that in the Czech Republic charges for the minimum access package and track access to service facilities are not set at the cost that is directly incurred as a result of operating the train service in contravention of Article 7(3) of Directive 2001/14. It claims that the ‘cost that is directly incurred as a result of operating the train service’ within the meaning of that provision must be understood as the marginal cost that is incurred as a result of the real operation of the train service. The Commission states that overhead costs cannot be included in that cost, given that they are not directly incurred as a result of operating the service.
            
         
               57.
            
            
               The Czech Republic contends that, because neither Directive 2001/14 nor any other provision of EU law sets out the expenses which are or are not covered by the notion of ‘cost that is directly incurred as a result of operating the train service’, it should be considered, for the purposes of classification of expenses which may be taken into account in calculating the amount of the charges, whether, in relation to such expenses, it is possible to establish a direct causal link with the operation of the train service, that is, whether those expenses were actually incurred in operating the train service. Consequently, it should be ascertained whether the expenses are linked directly to an activity or an object whose absence would prevent the train from running on a railway.
            
         
               58.
            
            
               According to the Czech Republic, the procedure in which the manager sets the amount of the charges taking into account only the expenses directly incurred as a result of the performance of the train service stems from Article 34c of the Law on railways in conjunction with the rail network statement adopted under that provision (‘the network statement’). In order to determine whether a certain cost, or a category of costs, is directly incurred as a result of operating the train service, it is necessary to examine whether that cost, or that category of costs, was generated by the operation of a particular form of rail transport.
            
         
               59.
            
            
               In its rejoinder, the Czech Republic argues that it is wrong to claim that adding an additional train to the operating schedule for a particular line does not, generally, increase traffic management costs. That Member State asserts in particular that, according to an opinion of the ‘Community of European Railway and Infrastructure Companies’ (CER), (
                     14
                  ) costs connected with scheduling, allocation of train paths, traffic management, dispatching and signalling of train runs must come under the category of costs directly incurred as a result of operating the train service.
            
         2. Examination of the third complaint
      a) Preliminary remarks
      
               60.
            
            
               I would note at the outset that I had the opportunity to consider in detail the structure and the interpretation of the provisions of Directive 2001/14 in my Opinion in Case C-556/10 Commission v Germany. (
                     15
                  ) In that case, I concluded that the Community rules had complexities which could not be reduced to a choice between two alternative methods for offsetting costs, but that it was necessary to apply a range comprising a minimum, namely the cost that is directly incurred as a result of operating the infrastructure, and a maximum, corresponding to the full costs incurred by the infrastructure manager. Between those extremes, the manager may apply additional charging criteria provided for in the directive, and discounts according to the conditions of Directive 2001/14 and, possibly, criteria laid down in the charging framework adopted by the Member State.
            
         
               61.
            
            
               I would also point out that the determination of the charge for the use of infrastructure, within the charging framework established by the Member State, must be performed by the infrastructure managers, who must ensure that the charging scheme is based on the same principles over the whole of their network. (
                     16
                  ) Under Article 8(3) of Directive 2001/14, to prevent discrimination, any given infrastructure manager’s average and marginal charges for equivalent uses of his infrastructure must be comparable and comparable services in the same market segment must be subject to the same charges. The infrastructure manager must show in the network statement that the charging system meets these requirements. (
                     17
                  )
            
         
               62.
            
            
               In contrast, the transposition into the laws of the Member State must lay down basic rules which allow access to minimum railway infrastructure services and define in general terms the arrangements for charging required by Directive 2001/14. However, as a general rule, the charging principles laid down by the directive must be applied at regulatory or even administrative level, on the basis of the charging framework and the network statement applied to specific market data. I would also point out that access to minimum infrastructure services may be subject to rates of return or even mark-ups ‘if the market can bear this’ (Article 8(1) of Directive 2001/14).
            
         
               63.
            
            
               Under the Commission’s third complaint in the present case, the Court is requested to rule on the interpretation of the minimum in the range, the ‘cost that is directly incurred as a result of operating the train service’. (
                     18
                  ) This task is not without difficulty given, first, the imprecision of Directive 2001/14, second, the fact that this interpretation relates to economic and even econometric concepts and data, and, lastly, the diversity in the theoretical definitions and practical applications of that notion in the railway sector.
            
         
               64.
            
            
               The objectives pursued by the legislature in this respect are easy to identify in my view. In the context of the general aim of EU rail regulation of guaranteeing equitable and non-discriminatory access to railway infrastructure, the requirement of access to minimum services in return for coverage of costs ‘directly incurred as a result of operating the infrastructure’ can be explained by the objective of permitting rail to meet the needs of the international traffic market and ensuring intermodal competitiveness of rail freight in relation to other means of transport. (
                     19
                  )
            
         
               65.
            
            
               However, market access and competitiveness both vis-à-vis incumbent rail operators and in relation to road traffic requires the railway infrastructure to be accessible without giving rise to compensation for the costs represented by investments in historic infrastructure which were not financed by existing operators or which do not affect other competing modes of transport.
            
         b) The ‘cost that is directly incurred as a result of operating the train service’
      
               66.
            
            
               According to the Commission, the ‘cost that is directly incurred as a result of operating the train service’ within the meaning of Article 7(3) of Directive 2001/14 must be understood as the marginal cost that is incurred as a result of the real operation of the train service. The Commission stated at the hearing that this corresponded primarily to costs connected with rail wear as a result of train movements. According to the Czech Republic, the expenses which may be taken into account in calculating the amount of the charges are those for which it is possible to establish a direct causal link with the operation of the train service, that is the expenses actually incurred in operating the train service.
            
         
               67.
            
            
               In an economic sense, a marginal cost corresponds to the additional cost generated by the production of one additional unit. Applied to the railway sector, the marginal cost for the use of the infrastructure is thus equivalent to the cost to be borne by the infrastructure manager by reason of the use of a defined part of the infrastructure, such as a stretch of line, by one additional train. (
                     20
                  )
            
         
               68.
            
            
               In determining the marginal costs for the use of the infrastructure, only costs which vary depending on traffic may be taken into account. Fixed costs or variable costs, whose variation does not depend on traffic, incurred by the infrastructure manager regardless of the volume of traffic constitute non-recoverable costs (‘sunk costs’), which are not included in the amount of the marginal cost. Having said that, as the Commission pointed out at the hearing, if the infrastructure manager were able to cover only the marginal costs for traffic, he could not continue to provide his services on a sustainable basis unless other costs to be borne by him were financed by revenue from other activities or by grants from the State or from regional and local authorities.
            
         
               69.
            
            
               As regards the unit of traffic by reference to which the cost of access to the infrastructure is determined in the different European States, it must be stated that there is a considerable disparity in this regard. The units for quantifying marginal cost include, for example, ‘gross tonne-kilometres’, ‘train-kilometres’, ‘station stops’, ‘number of train passages’, or even a combination of these criteria. (
                     21
                  ) Furthermore, there may be differences between modes of rail transport, such as freight, passenger transport or local public transport.
            
         
               70.
            
            
               Consequently, even though the notion of marginal cost for access to the railway infrastructure can be defined relatively easily, the practical application of that definition proves difficult, as is shown by the debate between the Commission and the Member States. In fact, it would appear that the practical determination of whether a cost is fixed or variable and, within this latter category, whether or not that cost depends on traffic, raises certain doubts. For example, for costs connected with repairs and maintenance, clearance of snow and ice from rails, or use of signalling and safety systems, classification depends on subjective assessments which have a significant impact on the result in terms of the marginal cost determined. (
                     22
                  )
            
         
               71.
            
            
               Aware of the considerable disparities which exist between the Member States, in its draft recast submitted in 2010, the Commission proposed that a list be drawn up of items which cannot be included in the calculation of ‘direct costs of the train service … which are related to infrastructure wear and tear’. (
                     23
                  ) That list included the following items: ‘(a) Network-wide overhead costs, including salaries and pensions; (b) Interest payable on capital; (c) More than one tenth of costs related to scheduling, train path allocation, traffic management, dispatching and signalling of a train run; (d) Depreciation of information, communication or telecommunication equipment; (e) Costs related to real estate management, in particular acquisition, selling, dismantling, decontamination, recultivation or renting of land or other fixed assets; (f) Social services, schools, kindergartens, restaurants; (g) Costs related to acts of God, accidents, service disruptions’. (
                     24
                  )
            
         
               72.
            
            
               This list was removed, however, in the course of the legislative procedure. The amended text of the recast now provides, in Article 31(3) that, before 30 months after the entry into force of the directive ‘the Commission shall adopt measures setting out the modalities for the calculation of the cost that is directly incurred as a result of operating the train service’. (
                     25
                  ) It should be noted that the legislature has not included the condition relating to costs ‘which are related to infrastructure wear and tear’ proposed by the Commission.
            
         
               73.
            
            
               Lastly, I would point out that the real marginal cost for the use of the railway infrastructure is also dependent on the characteristics of the train, the locomotive and the rails. However, the provisions of Directive 2001/14 limit the possibilities for taking into account all the individual traffic characteristics. Under Article 8(3) of that directive, any given infrastructure manager’s average and marginal charges for equivalent uses of his infrastructure must be comparable. In my view, it is not therefore possible to apply the marginal costs principle in the strict sense, since the charges cannot fully take into account differences connected with different forms of use.
            
         
               74.
            
            
               As far as the methodology applicable to the determination of marginal costs is concerned, it should be noted that there is no uniform approach. There are therefore considerable difficulties in establishing reliable and exhaustive statistical data. On the other hand, econometric studies show that the levels of marginal costs for the use of the railway infrastructure appear relatively stable. For that reason, if the statistical data do not allow marginal costs to be calculated, it is possible to use an estimate corresponding, for example, to around 20% of the total costs for financing the infrastructure (‘full financial costs’).
            
         
               75.
            
            
               Consequently, because Directive 2001/14 is imprecise and there is no precise definition of the notion of ‘cost that is directly incurred as a result of operating the train service’ or provision of EU law setting out precisely the costs not covered by that notion, as EU law stands at present the Member States enjoy a certain economic margin of discretion in transposing and applying that notion. The Court is not in a position to offer any helpful clarification in this regard, in view of the extremely technical nature of the issue and the existence of different expert studies to establish a common definition and methodology within the European Union. In any event, there seems little point in attempting to clarify the legal meaning of this notion in EU law, when it is an economic science notion whose application raises considerable practical difficulties.
            
         
               76.
            
            
               Nevertheless, even though it does not seem possible to define exhaustively what is and what is not covered by the notion of ‘cost that is directly incurred as a result of operating the train service’, the definitions used by the Member States may, in some cases, include costs which manifestly go beyond the limits of the notion used by Directive 2001/14. Within the framework of infringement proceedings, it must therefore be ascertained whether the contested legislation of the Member State permits the inclusion in the calculation of the charges for the minimum access package and track access to the railway infrastructure of items which are manifestly not directly incurred as a result of operating the train service.
            
         c) The alleged infringement
      
               77.
            
            
               In the present case, the Commission and the Czech Republic essentially seem to disagree on which precise costs may be regarded as directly incurred as a result of operating the train service, rather than on the theoretical definition of that notion, even though the requirement of a causal link invoked by the Member State in question would seem to call for a comparison of the situation where part of the infrastructure is made available to traffic with the situation where that part remains unused, and not the determination of the marginal cost in an economic sense.
            
         
               78.
            
            
               In its application, the Commission essentially claimed that in the Czech Republic the charges for the minimum access package and track access to service facilities are not set at the cost that is directly incurred as a result of operating the train service. In the reply, it specified that this related to the marginal cost that is incurred as a result of the real operation of the train service, that cost being variable (fluctuating) and changing depending on the real operation of the train service. In addition, the Commission considers that a distinction should be drawn between the ‘cost that is directly incurred as a result of operating the train service’ and the cost ‘directly linked to an activity or an asset which is essential to the running of a train on a given railway’, since the latter notion is, in its view, too broad in relation to the former.
            
         
               79.
            
            
               I consider, on the contrary, that the Commission’s approach is based on an excessively strict interpretation of Article 7(3) of Directive 2001/14. For example, the Commission wishes to exclude all costs connected with signalling, traffic management, personnel and safety. The Czech Republic rightly argues that such costs are partially dependent on traffic density, and that the Commission’s approach, which appears to acknowledge the possibility of an absence of costs directly incurred as a result of operating the service, cannot be accepted. (
                     26
                  )
            
         
               80.
            
            
               The Commission complains in particular that the Czech Republic included overhead costs in the costs which are taken into account in determining costs directly incurred as a result of operating the train service. It claims, moreover, that the Czech legislation does not include a definition of such costs and the determination of charges is based on a cost allocation model, provided for by Decree No 501/2005 Sb. establishing the expenses borne by the railway manager in connection with the use and operation, modernisation and development of railways.
            
         
               81.
            
            
               According to the Czech Republic, the procedure in which the manager sets the amount of the charges taking account only of the expenses directly incurred as a result of the performance of the train service stems from Article 34c of the Law on railways in conjunction with the rail network statement for 2010/2011. According to this latter document, the amount of the charges for the use of the transport service depends on the type of train, its weight and the distance covered. The method for calculating prices for the use of the transport service takes account of specific rules and the charging framework, as defined by the regulatory authority, for costs connected with the operation of the service, expressed in train-kilometres, costs that are directly incurred as a result of operating the service and actually generated by the operation of rail transport, expressed in gross tonne-kilometres, and additional costs directly connected with the use of the transport service.
            
         
               82.
            
            
               As far as Decree No 501/2005 Sb. is concerned, the Czech Republic claims that this measure does not form the basis for setting charges for the use of infrastructure, but concerns only the determination of the expenses borne by the railway infrastructure operator, namely the public railway management body, before 1 July 2008. Thus, without disputing that overhead costs are included in the calculation under the decree, the Member State nevertheless stresses that they are not among the charges referred to in Article 7(3) of Directive 2001/14.
            
         
               83.
            
            
               As regards the transposition of the requirement under Article 7(3) of Directive 2001/14 that the amount of the charge be limited to the cost that is directly incurred as a result of operating the train service, the Czech legislation, and more precisely the network statement drawn up by the capacity allocation body, seems to include all the necessary elements for the infrastructure manager and the regulatory authority to be able to set the charges in accordance with that requirement. As far as the practical application of the elements in question is concerned, the Commission has not provided any specific examples showing access charges set contrary to that requirement in the Czech Republic. In addition, I consider that the Commission has also not succeeded in establishing that the interpretation of the national legislation advocated by that Member State is erroneous. It is settled case-law that, in proceedings for failure to fulfil an obligation, it is for the Commission to provide all the proof needed to enable the Court to determine whether the obligation has not been fulfilled. (
                     27
                  )
            
         
               84.
            
            
               On those grounds, I propose that the Court reject the Commission’s third complaint.
            
         D – The fourth complaint concerning the absence of a performance scheme
      
      1. Arguments of the parties
      
               85.
            
            
               The Commission claims that the Czech Republic has failed to fulfil its obligations under Article 11(1) and (2) of Directive 2001/14 by failing to introduce a performance scheme encouraging railway undertakings and the infrastructure manager to minimise disruption and improve the performance of the railway network. In its view, the Law on the State Transport Infrastructure Fund does not transpose Article 11 of the directive. The Commission adds that the incentives scheme must form part of the charging regime.
            
         
               86.
            
            
               The Czech Republic claims that, in view of the degree of harmonisation achieved at EU level, the Commission has not established that the performance scheme introduced by the rail network statement, which is itself based on Article 34c of the Law on railways, is inadequate. The Czech Republic adds that it has a performance scheme, both in relation to carriers and in relation to infrastructure managers.
            
         
               87.
            
            
               In its reply, the Commission claims that the compensation scheme to which the Czech Republic refers is optional, contrary to the provision made in Article 11 of Directive 2001/14.
            
         
               88.
            
            
               Lastly, in its rejoinder, the Czech Republic adds that Article 34c(2)(k) of the Law on railways was supplemented in 2011 by Law No 134/2011 (zákon č. 134/2011 Sb.), which expressly provides that the rail network statement must now contain ‘a delimitation of the financial incentive scheme for the allocation authority and the carrier in order to minimise disruption to infrastructure and improve its permeability with a view to the negotiation of an operating agreement for the railway service; the scheme may include fines and compensation’.
            
         
               89.
            
            
               The Kingdom of Spain argues that it is necessary to analyse each specific measure and to examine whether, in the infrastructure charging system as a whole, these measures are effective in minimising disruption and improving the operation of the railway network, which is the objective pursued by Directive 2001/14.
            
         2. Examination of the fourth complaint
      
               90.
            
            
               It should be noted at the outset that the Commission’s fourth complaint concerning measures to encourage railway undertakings and the infrastructure manager to minimise disruption and improve the performance of the railway network by establishing a ‘performance scheme’ is essentially identical to the second complaint in Case C-483/10 Commission v Spain. For that reason, reference should be made to the legal reasoning developed in the Opinion delivered in that case. (
                     28
                  )
            
         
               91.
            
            
               I consider that the Czech Republic had not implemented, on the date of expiry of the period prescribed in the reasoned opinion, a performance scheme for railway undertakings and infrastructure managers which satisfies the requirements of Article 11 of Directive 2001/14. Even supposing that the legislation and provisions of agreements mentioned by that Member State could be regarded as measures to encourage the undertakings concerned and that they were applicable on the relevant date, they do not constitute a coherent and transparent whole within an infrastructure charging system.
            
         
               92.
            
            
               As the Commission has rightly stated, the Law on the State Transport Infrastructure Fund does not transpose Article 11 of Directive 2001/14, but simply provides, in Article 2 thereof, for the grant of financial resources with a view to maintaining or improving the condition of the railway infrastructure. In so far as it merely provides for the imposition of fines, either in the event of failure to comply with the obligations guaranteeing the operation of the network or in the absence of measures taken to rectify disruptions, Article 51(1) to (4) and (6) to (8) of the Law on railways does not establish a performance scheme within an infrastructure charging system in the abovementioned sense. This finding cannot be invalidated by a legislative provision adopted in 2011, after the expiry of the time-limit prescribed in the Commission’s reasoned opinion.
            
         
               93.
            
            
               On those grounds, I propose that the Court uphold the Commission’s fourth complaint.
            
         E – The fifth complaint concerning the lack of competence of the regulatory body
      
      1. Arguments of the parties
      
               94.
            
            
               The Commission claims that Article 30(5) of Directive 2001/14 seeks to permit the regulatory body to decide in full independence and to adopt measures quickly and efficiently to remedy any dysfunction on the market. According to the Commission, Article 30(6) of Directive 2001/14 does not introduce the possibility of an administrative review of the regulatory body’s decisions, but expressly provides only for the possibility of a judicial review. However, under Article 56(c) of the Law on railways, a decision of the Office for Railways, which is the regulatory body, must be challenged by an administrative appeal to the Ministry of Transport, in contravention of Article 30(5) of Directive 2001/14.
            
         
               95.
            
            
               The Commission also argues that Article 30(5) of Directive 2001/14 must be interpreted to the effect that the regulatory body decides and takes action on all matters referred to in Article 30 of the directive, in particular those set out in paragraphs 2 and 3 of that article. However, it is clear from the provisions of Article 34g of the Law on railways that the Office for Railways is authorised to examine, at the request of an applicant, (i) the rail network statement, and (ii) the process for the allocation of railway infrastructure capacity. The Commission infers that the Office is not authorised to adopt decisions or corrective measures in all the matters mentioned in Article 30(2) and (3) of Directive 2001/14, for example in relation to the level or structure of infrastructure fees which the applicant is, or may be, required to pay, as provided for in Article 30(2)(e) of the directive.
            
         
               96.
            
            
               Lastly, the Commission claims that Article 30(3) of Directive 2001/14 requires that, in the matters referred to in that provision, the regulatory body act on its own initiative, whereas Article 34g of the Law on railways provides that the Office for Railways acts only at the request of an applicant.
            
         
               97.
            
            
               The Czech Republic contends, first of all, that Directive 2001/14 does not prevent the regulatory body’s decisions being subject, prior to possible judicial review, to review by another independent body in the executive.
            
         
               98.
            
            
               In particular, it is not possible to infer from Article 30(6) of Directive 2001/14 requirements relating to the internal organisation of the administrative procedure. The Member States are free, in principle, to organise their own procedural rules.
            
         
               99.
            
            
               Second, with regard to the competence of the regulatory body, the Czech Republic points out that, in proceedings for failure to fulfil an obligation under Article 258 TFEU, it is for the Commission to determine whether the obligation has not been fulfilled. However, the Commission has not mentioned, other than Article 30(2)(e) of Directive 2001/14, any provision in relation to the scope of the powers of the Office for Railways which was incorrectly transposed. Thus, the Czech Republic proposes examining only the transposition of Article 30(2)(e) of Directive 2001/14 in so far as it is the only sufficiently precise plea in law in accordance with the Court’s case-law.
            
         
               100.
            
            
               In this regard, the Czech Republic claims that the competence of the Office for Railways is, as far as Article 30(2)(e) of Directive 2001/14 is concerned, fully covered by Article 34g in conjunction with Article 34c(2) of the Law on railways. It is clear from those provisions that the Office’s power includes reviewing the level or structure of infrastructure fees. According to the Czech Republic, if the regulatory body has the necessary power to adopt measures under Article 30(2)(e) of Directive 2001/14, it logically follows that it has the necessary power to initiate the review procedure on its own initiative within the framework of State control.
            
         
               101.
            
            
               In its reply, the Commission states that it is clear from Article 34g of the Law on railways that the competences of the Office for Railways are limited to reviewing the rail network statement and the process for the allocation of railway infrastructure capacity. In its view, it follows that the competences of the Office for Railways do not correspond with the competences to be assumed by a regulatory body under Article 30(5) of Directive 2001/14.
            
         
               102.
            
            
               Lastly, in its rejoinder, the Czech Republic claims that the Commission’s complaints other than the complaint relating to the competence of the regulatory body in relation to the level of charges must be declared inadmissible. It argues that, in its application, the Commission defined the subject-matter of the complaint in the same way as in the reasoned opinion, namely by addressing only the scope of the competence in relation to the level of charges. On the other hand, in its reply the Commission expanded on the complaints relating to the transposition of Article 30(5) of the directive, both compared with the reasoned opinion and compared with the application, adding five additional complaints, in violation of the right to a fair hearing. (
                     29
                  )
            
         2. Examination of the fifth complaint
      a) First limb
      
               103.
            
            
               By the first limb of its fifth complaint, the Commission complains, vis-à-vis the Czech Republic, that under Article 56 of the Law on railways the appellate body against decisions of the regulatory body, namely the Office for Railways, is the Ministry of Transport.
            
         
               104.
            
            
               According to the Commission, such a prior administrative appeal is contrary to Article 30(5) of Directive 2001/14, because that provision does not permit an administrative review of the regulatory body’s decisions. The Czech Republic claims, on the other hand, that Directive 2001/14, interpreted in the light of the principle of the procedural autonomy of the Member States, does not prevent the regulatory body’s decisions being subject, prior to possible judicial review, to review by another administrative body.
            
         
               105.
            
            
               I consider that the national provision in question is not consistent with the provisions of Directive 2001/14.
            
         
               106.
            
            
               First, the national provision in question is, in my view, contrary to the broad logic of Article 30(5) and (6) of Directive 2001/14, which is based on the idea that an administrative decision taken by the regulatory body is solely subject to judicial review, and not to a prior administrative review, even though that possibility is not expressly ruled out.
            
         
               107.
            
            
               Second, it should be noted that, under Article 30(1) of Directive 2001/14, the Member States are to establish a regulatory body, and not several bodies. Even if it were permissible, under that provision, for the Czech Republic to entrust the tasks conferred on the regulatory body to the Ministry of Transport, rather than the Office for Railways, this is not the option it took, by its own admission.
            
         
               108.
            
            
               Third, the Commission rightly claims that the regulatory body must be able to adopt measures quickly and efficiently to remedy any dysfunction on the rail market. The Czech Republic’s argument that the administrative review of the decisions adopted by the regulatory body makes it possible to deal with a substantial proportion of complaints more quickly than if they had been dealt with in a judicial procedure is not convincing. If such a review is limited to reviewing the lawfulness of the regulatory body’s decisions, it would seem that it represents an additional stage prior to the judicial review. If, on the other hand, the Ministry has the power to reverse decisions and thus to alter the assessments made by the regulatory body, it should be regarded as a higher regulatory body in the administrative hierarchy, which does not seem to be consistent with either the wording or the broad logic of Article 30(1) of Directive 2001/14.
            
         
               109.
            
            
               On those grounds, I propose that the Court uphold the first limb of the Commission’s fifth complaint.
            
         b) Second limb
      
               110.
            
            
               By the second limb of the fifth complaint in its action, the Commission complains that the Czech Republic failed to confer on the regulatory body all the competences that such a body must hold under Article 30(5) of Directive 2001/14.
            
         
               111.
            
            
               As I explained in point 102, in the view of the Czech Republic, the Commission’s complaints other than the complaint relating to the competence of the regulatory body in relation to the level of charges should be declared inadmissible.
            
         
               112.
            
            
               It must be recalled that it follows from Article 38(1)(c) of the Rules of Procedure of the Court of Justice, (
                     30
                  ) as interpreted by the Court, that an application must state clearly and precisely the subject-matter of the proceedings and a summary of the pleas in law on which the application is based, so as to enable the defendant to prepare a defence and the Court to rule on the application. It follows that the essential points of law and of fact on which an action is based must be indicated coherently and intelligibly in the application itself and that the heads of claim must be set out unambiguously so that the Court does not rule ultra petita or indeed fail to rule on a complaint. (
                     31
                  )
            
         
               113.
            
            
               The Court has also held that, where an action is brought under Article 258 TFEU, the application must set out the complaints coherently and precisely, so that the Member State and the Court can know exactly the full extent of the alleged infringement of European Union law, a condition which must be satisfied if the Member State is to be able to present an effective defence and the Court to determine whether there has been a breach of obligations, as alleged. (
                     32
                  )
            
         
               114.
            
            
               With regard to the competences of the regulatory body, in its application the Commission alleged that Article 30(5) of Directive 2001/14 should be interpreted to the effect that the regulatory body must be able to decide and take action on all matters referred to in Article 30 of the directive, and above all on those set out in paragraphs 2 and 3 of that article. However, in those allegations, it only addressed the competence referred to in Article 30(2)(e) of the directive concerning the level or structure of infrastructure fees, and the purported impossibility for the Czech regulatory body to act on its own initiative.
            
         
               115.
            
            
               Even though the second limb of the fifth complaint in the application could be interpreted as covering all matters falling within the scope of Article 30(5) of Directive 2001/14 and the abovementioned aspects are cited only as examples, it must be stated that the application does not satisfy the requirements governing admissibility established by the Court’s abovementioned case-law, in the absence of adequate grounds allowing the alleged infringement to be established.
            
         
               116.
            
            
               I therefore propose that the Court declare inadmissible the second limb of the Commission’s fifth complaint, in so far as the infringement of Article 30(5) of Directive 2001/14 concerns aspects other than those in relation to the review of the level or structure of infrastructure fees and the capacity of the regulatory body to act on its own initiative.
            
         
               117.
            
            
               As regards, substantively, the capacity of the regulatory body to act on its own initiative, the Commission claims that Article 34g of the Law on railways provides that the Office for Railways acts only at the request of an applicant, whereas Article 30(3) of Directive 2001/14 requires that the regulatory body act on its own initiative. According to the Member State, Law No 552/1991 on State control, as amended, in conjunction with Article 58 of the Law on railways, provides for the time and/or the basis on which the regulatory body may act, whilst Article 34g(3) of that Law lays down the action to be taken in the event that an infringement is established.
            
         
               118.
            
            
               The Commission’s criticism is based on an interpretation of Article 34g of the Law on railways whereby, like the procedures before the Office for Railways referred to in paragraphs 1 and 2 of that article, which are initiated by an applicant for the allocation of capacity, the applicability of paragraph 3 of that article is also subject to such a request. (
                     33
                  )
            
         
               119.
            
            
               However, this interpretation of the national provision is challenged by the Czech Republic, which claims that State control in the field of railways is exercised on the basis of Article 58(2) of the Law on railways, under which the regulatory body must verify ‘whether the obligations on the railway owner, the railway manager and the carrier, as laid down by the law, are respected and fulfilled in the context of the operation of the railways and rail transport’.
            
         
               120.
            
            
               In the view of that Member State, that provision, in conjunction with Law No 552/1991, which confers on bodies which are competent to exercise State control the power to conduct verifications and, on the basis of those verifications, to initiate the infringement procedure, to adopt corrective measures or to impose fines for administrative infringements, establishes the competence of the regulatory body to take the decisions referred to in Article 34g(3) of the Law on railways on its own initiative.
            
         
               121.
            
            
               In this regard, I would reiterate that it is settled case-law that, in proceedings for failure to fulfil an obligation, it is for the Commission to provide all the proof needed to enable the Court to determine whether the obligation has not been fulfilled. It seems undeniable that the finding that an obligation has not been fulfilled cannot be based on the interpretation of an isolated provision of national law, even if, to use the words of the Commission, that provision follows ‘logically and systematically’ the preceding provisions of the same article, since that interpretation is fiercely contested by the Member State, which refers to provisions with more general application which militate in favour of the opposite interpretation. Consequently, in my view, the Commission has not been able to establish to the requisite legal standard that the Office for Railways does not have the capacity to act on its own initiative.
            
         
               122.
            
            
               Furthermore, the Commission claims that the regulatory body is not authorised to adopt decisions or corrective measures in all the matters mentioned in Article 30(2) and (3) of Directive 2001/14, for example in relation to the level or structure of infrastructure fees which the applicant is, or may be, required to pay, as provided for in Article 30(2)(e) of the directive.
            
         
               123.
            
            
               With regard to Article 30(2) and (3) of Directive 2001/14, I would point out that I consider the Commission’s action to be admissible only as regards the review of the level or structure of infrastructure fees.
            
         
               124.
            
            
               That being the case, the Czech Republic has contended, first, that under Article 34g(1) and (3) in conjunction with Article 34c(2) of the Law on railways, the Office for Railways is authorised, in reviewing the criteria set out in the rail network statement, to review information on the charge for the allocation of capacity and the determination of the charge for the use of railway infrastructure. Second, the review of the specific level of the infrastructure fee that a particular transport undertaking is required to pay is based on Article 34g(2) and (3) of that Law. Under those provisions, the Office for Railways is authorised to review the process for the allocation of railway infrastructure capacity, an essential element of which, according to the express provisions of the Law, is the determination of the specific level of the infrastructure access charge.
            
         
               125.
            
            
               Furthermore, according to the Czech Republic, the criteria for the rail network statement are laid down in Article 34c(2) of the Law on railways. Those criteria include information on prices for the allocation of railway infrastructure capacity and on the setting of the amount of charges for the use of railway infrastructure.
            
         
               126.
            
            
               The Czech Republic rightly states that information on prices and charges is merely another way of describing the level of infrastructure fees which are or may be charged. Similarly, the method used to set prices under Article 34g of the Law on railways, whose review is the responsibility of the regulatory body, includes the structure of infrastructure fees.
            
         
               127.
            
            
               The national provisions cited above do not seem, at first sight, inadequate having regard to the requirements under Article 30(2)(e) of Directive 2001/14. The regulatory body has the power to take decisions on the amendment of the statement, including criteria contained within it, or on the allocation of railway infrastructure capacity, in particular the method used to set prices. The procedural arrangements laid down to this effect, in particular the period of 15 days to lodge complaints, are liable to weaken this conclusion. However, this latter aspect was not raised by the Commission in its application, but only at the stage of its reply, and it therefore appears out of time. It follows that the Commission has not been able to establish to the required legal standard the reality of the alleged failure to fulfil obligations in respect of the competences of the regulatory body as regards the level or structure of infrastructure fees.
            
         
               128.
            
            
               On those grounds, I propose that the Court reject the second limb of the Commission’s fifth complaint as partially inadmissible and partially unfounded.
            
         F – The sixth complaint concerning the absence of the body referred to in Article 10(7) of Directive 91/440
      
      1. Arguments of the parties
      
               129.
            
            
               The Commission claims that the Czech Republic has failed to fulfil its obligations under Article 10(7) of Directive 91/440, because there does not exist in the Czech Republic a body such as that referred to in that provision to fulfil the functions laid down.
            
         
               130.
            
            
               Under the first subparagraph of Article 10(7) of Directive 91/440, either the regulatory body established pursuant to Article 30 of Directive 2000/14 or any other body enjoying the same degree of independence may monitor the competition in the rail services markets. In both cases, the body in question is required to satisfy the requirements under the second subparagraph of Article 10(7) of Directive 91/440, namely to have been set up in accordance with the rules in Article 30(1) of the Directive 91/440 to deal with complaints from applicants and, on the basis of a complaint or on its own initiative, to decide on appropriate measures to correct undesirable developments in these markets.
            
         
               131.
            
            
               In this regard, the Commission states that in the Czech Republic competition in the rail services markets is monitored by the Office for the Protection of Competition whose competences are defined by the Law on the competences of the Office for the Protection of Competition.
            
         
               132.
            
            
               However, under that legislation, the Office’s competence is limited to matters directly linked to competition in the rail services markets. The Commission infers that it does not exercise all the functions that it should exercise pursuant to the second subparagraph of Directive 91/440 and it cannot therefore be regarded as a body performing the functions set out in that provision. The Commission claims in particular that the Office in question cannot decide on any complaint from applicants who feel that they have been treated unjustly, have been the subject of discrimination or have been injured in any other way and cannot, on the basis of a complaint or on its own initiative, decide on appropriate measures to correct undesirable developments in these markets.
            
         
               133.
            
            
               The Czech Republic claims principally that this plea in law must be declared inadmissible. It argues that the Commission raised the complaint concerning an infringement of Article 10(7) of Directive 91/440, by reason of a lack of competence on the part of the Office for the Protection of Competition to exercise the functions referred to in the second subparagraph of Article 10(7) of Directive 91/440 only at the stage of the application and it did not therefore give it the opportunity to respond properly to these criticisms in the phase before the application was brought, in accordance with the Court’s settled case-law.
            
         
               134.
            
            
               The Czech Republic claims that, for the first time since the start of the proceedings, the Commission claims within the framework of the application a lack of incompetence on the part of the Office for the Protection of Competition, not in relation to the functions referred to in Article 30 of Directive 2001/14, as it did in the reasoned opinion, but in relation to Article 10(7) of Directive 91/440.
            
         2. Examination of the sixth complaint
      
               135.
            
            
               Like the Czech Republic, I take the view that the Commission’s sixth complaint must be declared inadmissible in the light of the case-law cited above. (
                     34
                  )
            
         
               136.
            
            
               In its reasoned opinion, the Commission actually referred to Article 10(7) of Directive 91/440, complaining that the Czech Republic has failed to fulfil obligations under that provision. However, the Commission’s complaint was based primarily on the claim that the Office for the Protection of Competition could not act as a regulatory body because the railway directives did not permit the functions of that body to be shared among several bodies. Secondly, the Member State was criticised for the fact that the Office for the Protection of Competition did not have all the competences referred to in Article 30 of Directive 2001/14.
            
         
               137.
            
            
               On those grounds, I propose that the Court reject the Commission’s sixth complaint as inadmissible.
            
         V – Costs
      
      
               138.
            
            
               Under Article 138(3) of the Rules of Procedure, (
                     35
                  ) the parties are to bear their own costs where each party succeeds on some and fails on other heads. As both the Commission and the Czech Republic have failed on several heads, I propose that each party bears its own costs.
            
         
               139.
            
            
               In accordance with Article 140(1) of the Rules of Procedure, the Kingdom of Spain is ordered to bear its own costs.
            
         VI – Conclusion
      
      
               140.
            
            
               In the light of the foregoing, I propose that the Court:
               
                        (1)
                     
                     
                        declare that the Czech Republic has failed to fulfil its obligations under
                        
                                 —
                              
                              
                                 Article 4(1) of Directive 2001/14/EC of the European Parliament and of the Council of 26 February 2001 on the allocation of railway infrastructure capacity and the levying of charges for the use of railway infrastructure and safety certification, as amended by Directive 2007/58/EC of the European Parliament and of the Council of 23 October 2007, by laying down a maximum amount for charges for the use of infrastructure;
                              
                           
                                 —
                              
                              
                                 Article 6(2) of Directive 2001/14, as amended by Directive 2007/58, by failing to adopt measures providing infrastructure managers with incentives to reduce the costs of provision of infrastructure and the level of access charges;
                              
                           
                                 —
                              
                              
                                 Article 11 of Directive 2001/14, as amended by Directive 2007/58, by failing to introduce a performance scheme encouraging railway undertakings and the infrastructure manager to minimise disruption and improve the performance of the railway network; and
                              
                           
                                 —
                              
                              
                                 Article 30(5) of Directive 2001/14, as amended by Directive 2007/58, by introducing an administrative review of the regulatory body’s decisions by means of an appeal to the Ministry of Transport;
                              
                           
                  
                        (2)
                     
                     
                        dismiss the action as to the remainder;
                     
                  
                        (3)
                     
                     
                        order the Commission, the Czech Republic and the Kingdom of Spain to bear their own costs.
                     
                  
         (
            1
         )	Original language: French.
      (
            2
         )	Directive 2001/14/EC of the European Parliament and of the Council of 26 February 2001 on the allocation of railway infrastructure capacity and the levying of charges for the use of railway infrastructure and safety certification (OJ 2001 L 75, p. 29).
      (
            3
         )	Directive 2007/58/EC of the European Parliament and of the Council of 23 October 2007 (OJ 2007 L 315, p. 44). It should be noted that the title of Directive 2001/14 was amended by Article 30 of Directive 2004/49/EC of the European Parliament and of the Council of 29 April 2004 (OJ 2004 L 164, p. 44). Its title since then has been ‘Directive 2001/14/EC of the European Parliament and of the Council of 26 February 2001 on the allocation of railway infrastructure capacity and the levying of charges for the use of railway infrastructure’.
      (
            4
         )	Council Directive 91/440/EEC of 29 July 1991 on the development of the Community’s railways (OJ 1991 L 237, p. 25).
      (
            5
         )	Directive 2001/12/EC of the European Parliament and of the Council of 26 February 2001 (OJ 2001 L 75, p. 1).
      (
            6
         )	Case C-557/10 Commission v Portugal [2012] ECR and Case C-528/10 Commission v Greece, and Cases C-473/10 Commission v Hungary; C-483/10 Commission v Spain; C-512/10 Commission v Poland; C-555/10 Commission v Austria; C-556/10 Commission v Germany; C-625/10 Commission v France; C-627/10 Commission v Slovenia; C-369/11 Commission v Italy; and C-412/11 Commission v Luxembourg, pending before the Court.
      (
            7
         )	See my Opinion in Case C-483/10 Commission v Spain, points 41 to 53.
      (
            8
         )	To take a fictitious example, the State could decide that infrastructure costs represent 30% for rail freight traffic, 20% for long-distance passenger transport and 80% for local public transport. Consequently, the State would be responsible for the remainder of the costs generated, namely 70%, 80% and 20% respectively.
      (
            9
         )	Case C-438/04 Mobistar [2006] ECR I-6675, paragraph 37.
      (
            10
         )	Directive 2002/22/EC of the European Parliament and of the Council of 7 March 2002 on universal service and users’ rights relating to electronic communications networks and services (Universal Service Directive) (OJ 2002 L 108, p. 51).
      (
            11
         )	See my Opinions in Case C-556/10 Commission v Germany, cited above, points 93 to 104, and in Case C-512/10 Commission v Poland, cited above, points 74 to 84.
      (
            12
         )	See my Opinions in Commission v Spain, cited above, points 67 to 71, and Commission v Poland, cited above, point 76, and the fourth complaint in the present case, point 90 et seq.
      (
            13
         )	According to recital 40 in the preamble to Directive 2001/14, ‘[a] railway infrastructure is a natural monopoly. It is therefore necessary to provide infrastructure managers with incentives to reduce costs and manage their infrastructure efficiently’.
      (
            14
         )	Opinion of 9 May 2011 on the Commission’s initial proposal for the recast of the first railway package directives (see www.cer.be). The Czech Republic states that the Community of European Railway and Infrastructure Companies is a non-governmental organisation bringing together 79 European undertakings in the sector.
      (
            15
         )	Points 73 to 85.
      (
            16
         )	Article 4(1) and (4) of Directive 2001/14.
      (
            17
         )	Point 74 of my Opinion in Case C-556/10 Commission v Germany.
      (
            18
         )	The Court will also have to rule on this question in the context of the fourth complaint in Case C-512/10 Commission v Poland, points 92 to 105.
      (
            19
         )	See recitals 32, 33, 38 and 39 in the preamble to Directive 2001/14.
      (
            20
         )	As regards the marginal cost for the use of railway infrastructure, see the document entitled ‘Charges for the Use of Rail Infrastructure of 2008’, OECD/International Transport Forum 2008 (www.internationaltransportforum.org) and P. Wheat, A. Smith and C. Nash: CATRIN (Cost Allocation of Transport Infrastructure Cost), Deliverable 8 – Rail Cost Allocation for Europe, Stockholm 2009.
      (
            21
         )	See ‘Charges for the Use of Rail Infrastructure of 2008’.
      (
            22
         )	T. Suvanto: Marginal Cost Pricing, ECMT Workshop on Rail Infrastructure Charges, Rome 9.7.2004, Ministry of Transport and Communications of Finland, http://www.internationaltransportforum.org/IntOrg/ecmt/railways/pdf/Rome04FIN.pdf
      (
            23
         )	See Annex VIII, point 1 to the Proposal for a Directive of the European Parliament and of the Council establishing a Single European railway area COM(2010) 475 final.
      (
            24
         )	At first reading the European Parliament deleted point (c).
      (
            25
         )	European Parliament legislative resolution of 3 July 2012 on the Council position at first reading with a view to the adoption of a directive of the European Parliament and of the Council establishing a single European railway area (recast) (18581/2/2011-C7-0268/2010-2010/0253(COD), Article 31 and footnote 18.
      (
            26
         )	The Commission refers in this regard to the Catrin study, cited above in footnote 20, according to which the charges set at the costs that are directly incurred as a result of operating the train service fall within a range from EUR 0 to 2 per train-kilometre in the case of a typical 960 gross tonne freight train.
      (
            27
         )	Case C-159/94 Commission v France [1997] ECR I-5815, paragraph 102, and Case C-55/99 Commission v France [2000] ECR I-11499, paragraph 30.
      (
            28
         )	See points 67 to 72 of that Opinion.
      (
            29
         )	Those five complaints are: (i) lack of competence with regard to the examination of the requirements referred to in the introductory sentence of Article 30(2) of Directive 2001/14; (ii) a limitation of the examination of the requirements referred to in Article 30(2)(c) thereof, on account of the time-limit for lodging a complaint; (iii) lack of competence to examine the requirements referred to in Article 30(2)(d); (iv) a limitation of the examination of the requirements referred to in Article 30(2)(d), on account of the time-limit for lodging a complaint, and (v) a limitation of the examination of the requirements referred to in Article 30(2)(e), on account of the time-limit for lodging a complaint.
      (
            30
         )	In this instance, the version in force prior to 1 November 2012.
      (
            31
         )	See, inter alia, Case C-475/07 Commission v Poland, paragraph 43; Case C-375/10 Commission v Spain, paragraph 10; and judgment of 10 May 2012 in Case C-39/10 Commission v Estonia, paragraph 24.
      (
            32
         )	See, inter alia, Commission v Poland, paragraph 44; Commission v Spain, paragraph 11; and Commission v Estonia, paragraph 26, cited above.
      (
            33
         )	I would recall that Article 34g(3) of the Law on railways reads as follows: ‘If the Office for Railways finds that an incorrect procedure was followed in the preparation of the network statement, … it shall decide to amend that statement, including criteria contained within it, or it shall decide on an allocation of that capacity, in particular the method used to set prices’.
      (
            34
         )	See footnotes 31 and 32 above.
      (
            35
         )	The act which entered into force on 1 November 2012.