Europaudvalget 2017
KOM (2017) 0647
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EUROPEAN
COMMISSION
Brussels, 8.11.2017
SWD(2017) 358 final
COMMISSION STAFF WORKING DOCUMENT
IMPACT ASSESSMENT
Accompanying the document
Proposal for a Regulation of the European Parliament and of the Council
amending Regulation (EC) No 1073/2009 on common rules for access to the
international market for coach and bus services
{COM(2017) 647 final} - {SWD(2017) 359 final}
EN
EN
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Table of Contents
GLOSSARY OF DEFINITIONS, ACRONYMS AND ABBREVIATIONS .................. III
1.
2.
INTRODUCTION ....................................................................................................... 1
WHAT IS THE PROBLEM AND WHY IS IT A PROBLEM? ................................. 1
2.1. Policy Context ................................................................................................... 1
2.2. Market Context .................................................................................................. 4
2.3. Evaluation of the Regulation ............................................................................. 7
2.4. Problem definition ............................................................................................. 8
2.5. What are the problem drivers? ........................................................................ 16
2.5.1.
2.5.2.
2.5.3.
Problem driver 1: Restricted access to national inter-urban
markets .............................................................................................. 16
Problem driver 2: Excessive administrative costs of entry ............... 18
Problem driver 3: Restricted access to key infrastructure ................. 20
2.6. Who is affected by the problem, in what ways, and to what extent? .............. 23
2.7. What is the EU dimension of the problem?..................................................... 23
2.8. How would the problem evolve, all things being equal? ................................ 24
3.
WHY SHOULD THE EU ACT? .............................................................................. 26
3.1. Legal Basis ...................................................................................................... 26
3.2. Subsidiarity ...................................................................................................... 27
3.2.1.
3.2.2.
4.
Necessity test ..................................................................................... 27
EU added value test ........................................................................... 28
WHAT SHOULD BE ACHIEVED? ........................................................................ 28
4.1. General policy objective .................................................................................. 29
4.2. Specific objectives ........................................................................................... 29
5.
WHAT ARE THE VARIOUS OPTIONS TO ACHIEVE THE
OBJECTIVES? .......................................................................................................... 30
5.1. Retained policy measures ................................................................................ 30
5.2. Identification of possible policy packages ...................................................... 32
5.3. Identification of a list of market access policy options ................................... 32
5.4. Identification of a list of terminal access policy options ................................. 35
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6.
WHAT ARE THE IMPACTS OF THE DIFFERENT POLICY OPTIONS
AND WHO WILL BE AFFECTED? ........................................................................ 37
6.1. Impacts of policy options to address excessive administration costs of
entry and market access problems ................................................................... 39
6.1.1.
6.1.2.
6.1.3.
6.2.1.
6.2.2.
6.2.3.
Economic impacts ............................................................................. 39
Environmental impacts ...................................................................... 55
Social impacts .................................................................................... 56
Economic impacts ............................................................................. 63
Environmental impacts ...................................................................... 66
Social impacts .................................................................................... 66
6.2. Impacts of policy options to address terminal access problems ...................... 63
7.
HOW DO THE OPTIONS COMPARE? .................................................................. 69
7.1. Effectiveness and efficiency ............................................................................ 69
7.2. Coherence ........................................................................................................ 71
7.3. Proportionality of the preferred option ............................................................ 73
7.4. Conclusion of the comparison of options and combined effects ..................... 76
8.
HOW WOULD ACTUAL IMPACTS BE MONITORED AND
EVALUATED? ......................................................................................................... 78
ANNEX 1: PROCEDURAL INFORMATION CONCERNING THE PROCESS
TO PREPARE THE IMPACT ASSESSMENT REPORT AND THE
RELATED INITIATIVE. ......................................................................................... 80
ANNEX 2: STAKEHOLDER CONSULTATION SYNOPSIS REPORT. ...................... 89
ANNEX 3: WHO IS AFFECTED BY THE INITIATIVE AND HOW? ....................... 101
ANNEX 4: ANALYTICAL MODEL USED IN PREPARING THE IMPACT
ASSESSMENT ....................................................................................................... 102
Scenario design, consultation process and quality assurance
........ 105
Main assumptions of the Baseline scenario
.................................... 106
ANNEX 5: DESCRIPTION OF THE ROAD INITIATIVES
– THE ‘BIG
PICTURE’.
.............................................................................................................. 122
ANNEX 6: DISCARDED POLICY MEASURES ......................................................... 128
ANNEX 7: IMPACTS OF LIBERALISATION ON PSOS ........................................... 135
ANNEX 8: CASE STUDIES .......................................................................................... 137
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G
LOSSARY OF DEFINITIONS
,
ACRONYMS AND ABBREVIATIONS
ARAFER
ART
Cabotage operations
Autorité de régulation des activités ferroviaires et routières
Autorità di Regolazione dei trasporti
Means either:
- national road passenger services for hire and reward carried out on a
temporary basis by a carrier in a host Member State, or
- the picking up and setting down of passengers within the same
Member State, in the course of a regular international service, in
compliance with the provisions of Regulation (EC) No 1073/2009,
provided that it is not the principal purpose of the service.
European Disability Forum
European Transport Federation
European Union
General objective
Is the main intercity coach provider in Greece "Common Funds of Bus
Proceeds"
Impact Assessment
Global Industry Association of Road Transport
Net present value
Open Public Consultation
Passenger-kilometres
Persons with reduced mobility
Public Service Contract means one or more legally binding acts
confirming the agreement between a competent authority and a public
service operator to entrust to that public service operator the
management and operation of public passenger transport services
subject to public service obligations; depending on the law of the
Member State, the contract may also consist of a decision adopted by
the competent authority:
- taking the form of an individual legislative or regulatory act, or
- containing conditions under which the competent authority itself
provides the services or entrusts the provision of such services to an
internal operator;
Public Service Obligation means a requirement defined or determined
by a competent authority in order to ensure public passenger transport
services in the general interest that an operator, if it were considering
its own commercial interests, would not assume or would not assume
to the same extent or under the same conditions without reward
DIRECTIVE 96/71/EC concerning the posting of workers in the
framework of the provision of services
Regulatory fitness and performance revision
Railway Information Measuring and Monitoring System
Small and medium-sized enterprises
Specific Objective
EDF
ETF
EU
GO
KTEL
IA
IRU
NPV
OPC
pkm
PRMs
PSC
PSO
PWD
REFIT
RIMMS
SME
SO
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1.
I
NTRODUCTION
This impact assessment (IA) accompanies a legislative proposal that revises Regulation
(EC) No 1073/2009 of the European Parliament and of the Council on common rules for
access to the international market for coach services, and amending Regulation (EC) No
561/2006
1
(hereinafter “the Regulation”).
The Regulation forms part of a common EU legal framework for efficient, fair and
sustainable road transport. Within the framework the Regulation is closely related to the
legislation on access to the occupation of road transport operator
2
and social rules for
road transport operators (the Driving Time Regulation
3
, Road Transport Working Time
Directive
4
, the Enforcement Directive
5
, and the Tachograph Regulation
6
) which together
set the legal framework for road passenger transport operators to operate in the EU.
This initiative is part of a broader review of the existing legislation applying to road
transport. The objective of the review is to update and improve the existing legislation so
that it continues to achieve its objectives without undue burdens. Together, these
initiatives consider a range of different options, with mutually reinforcing measures,
which ultimately should improve the efficiency, fairness and sustainability of road
transport. For road passenger transport operations the interaction of this initiative and
initiatives on access to the occupation, social rules and the Eurovignette
7
are closely
linked. This package is further described in Annex 5.
This impact assessment concerns a new REFIT initiative (regulatory fitness and
performance revision) of current law
8
that aims to simplify and reduce regulatory costs
while maintaining benefits.
2.
W
HAT IS THE PROBLEM AND WHY IS IT A PROBLEM
?
2.1.
Policy Context
This initiative is closely linked with the Communication of the Commission of 31 May,
'Europe on the Move'
9
, which aims to make transport cleaner, more connected and
competitive. Bus and coach services have the possibility of contributing to all these
objectives by providing better services to citizens
The internal market is not yet complete and barriers remain, notably in the area of
services. The integration of the European Union (EU) transport market remains low in
comparison to other parts of the economy and a genuine EU-wide internal market exists
only in air transport, while other transport modes, including road, suffer from different
degrees of fragmentation along national borders.
The White Paper
10
on transport policy adopted on 28 March 2011 (hereinafter “the 2011
White Paper”) sets out the Commission’s vision for a competitive and sustainable
transport system and reiterates the continuing importance of our ultimate aim, to pursue a
1
2
OJL 300, 14.11.2009, p. 88.
Regulation (EC) No 1071/2009, OJ L 300, 14.11.2009, p. 51
3
Regulation (EC) 561/2006, OJ L 102, 11.4.2006, p. 1
4
Directive 2002/15/EC, OJ L 80, 23.3.2002, p. 35
5
Directive 2006/22/EC, OJ L 102, 11.4.2006, p. 35
6
Regulation (EU) No 165/2014, OJ L 60, 28.2.2014, p. 1
7
Directive 1999/62/EC, OJ L 187, 20.7.1999, p. 42
8
Initiative no. 9, annex 2, Commission Work Programme 2017
9
SWD(2017) 177 final
10
See
http://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:52011DC0144
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single European transport area and remove competitive distortions. This will help the EU
transport policy remains the creation of a single European transport area, to help the EU
stay competitive by optimising the performance of the entire transport sector for the
benefit of all while safeguarding safety, security and the environment. It acknowledges
that curbing mobility is not an option and that new transport patterns must emerge,
according to which greater numbers of travellers are carried jointly to their destination by
the most efficient (combination of) modes.
In the 1990s, the internal market for bus and coach services was created by two separate
pieces of legislation, namely Council Regulation (EEC) No 684/92 on common rules for
the international carriage of passengers by coach and bus
11
and Council Regulation (EC)
No 12/98 laying down the conditions under which non-resident carriers may operate
national road passenger transport services within a Member State
12
. These Regulations
were consolidated by the Regulation which provides the conditions for the international
carriage of passengers by coach and bus services within the EU by carriers for hire and
reward.
The Regulation was adopted as a part of a legislative package with Regulation (EC) No
1071/2009 establishing common rules concerning the conditions to be complied with to
pursue the occupation of road transport operator
13
and Regulation (EC) No 1072/2009 on
common rules for access to the international road haulage market
14
. Together, these three
regulations establish the conditions for accessing the profession and for accessing the
markets for transport of goods and people by road and aim to support the completion of
the internal market in road transport, its efficiency and competitiveness.
The scope of the Regulation covers the international carriage of passengers by coach and
bus within the EU by carriers for hire and reward in possession of a Community licence
or by own-account carriers established in a Member State.
The regulation provides for the opening of the markets for the following services:
Table 2-1: International carriage of passengers
Type of service
Regular services
Definition
Regular services means services which provide for
the carriage of passengers at specified intervals
along specified routes, passengers being picked up
and set down at predetermined stopping points.
Typical example: Regular, scheduled service open
to all passengers, such as Eurolines services
between Member States.
Special regular services mean regular services, by
whosoever organised, which provide for the
carriage of specified categories of passengers to the
exclusion of other passengers.
Typical examples: Regular, scheduled service not
open to all passengers, such as:
School services serving only those
attending a school; and
Regime
Subject
to
authorisation
granted by the competent
authorities of the MSs
concerned
Special Regular
Services
Not subject to authorisation
where they are covered by a
contract concluded between
the organiser and the carrier
11
12
OJL 74, 20.3.1992, p. 1.
OJL 4, 8.1.1998, p. 10.
13
OJL 300, 14.11.2009, p. 51
14
OJL 300, 14.11.2009, p. 72
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Occasional
Services
Staff services serving only those working
at a location.
Occasional services means services which do not
fall within the definition of regular services,
including special regular services, and the main
characteristic of which is the carriage of groups of
passengers constituted on the initiative of the
customer or the carrier himself.
Typical examples: Multi-day visit or tour requested
by a customer or offered by a carrier. Excursion or
day trip requested by a customer or offered by a
carrier. Local excursion or day trip offered to those
already on a multi-day visit.
Exempt from authorisations
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
The Regulation lays down the provisions to be complied with by undertakings that wish
to operate on the international road passenger transport market and on national markets
other than their own (known as
cabotage operations).
Table 2-2: Cabotage Operations
Type of service
Regular services
Permitted cabotage operations
The picking up and setting down of passengers within the same MS, in
the course of a regular international service provided that:
It is not the principal purpose of the service;
It is not a transport service meeting the needs of an urban centre
or conurbation, or transport needs between it and the surrounding
areas; and
It is not performed independently of such international service
Liberalised from any specific authorisation if carried out on a temporary
basis and covered by a contract concluded between the organiser and the
carrier.
Liberalised from any specific authorisation
Special Regular Services
Occasional Services
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
It includes provisions related to the documents to be issued to such carriers by the
Member State of registration (Community licence) and by the authorising authority
(Authorisation for a regular service). It sets down provisions regarding the sanctioning of
infringements and cooperation between Member States in that context.
The Regulation has the following general objectives:
To promote coach transport as a sustainable alternative to individual car transport.
To open the market for international services and for cabotage operations without
undermining public service obligations;
To prevent discrimination on grounds of nationality or place of establishment;
and
To limit the administrative burden to the extent possible
No rules have been adopted so far at EU level as regards access to the national markets
for regular services by coach and bus (except cabotage operations which are part of an
international service) and therefore the operation of national services is otherwise subject
to the laws, regulations or administrative provisions of the Member States.
This initiative should be seen as complementary to several parallel initiatives in the
review of road transport legislation as part of the mobility package.
Market and
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social issues in the road passenger transport sector are likely to become more
interdependent because market opening tends to increase competitive pressure on
operators and their mobile workers. Addressing these issues requires a holistic approach
whereby the social, internal market and posting of workers' rules are considered together
to ensure both fair working conditions for drivers and fair competition between operators.
It is also closely linked with the road charging initiatives which propose to include
coaches in the Eurovignette Directive and contribute to a level playing field in particular
with rail.
Therefore, this initiative on access to the coach market is part of a co-ordinated
response to both the social and market challenges faced.
This initiative is in particular complementary to the on-going revision of the Posting of
Workers Directive 96/71/EC
15
(PWD), which aims to clarify and update the provisions
adopted more than twenty years ago and to ensure that the Directive still strikes the right
balance between the need to promote the freedom to provide services and the need to protect
the rights of posted workers. The PWD revision deals with general issues, such as broader set
of remuneration rules or maximum periods of posting to be applied to all sectors. This
initiative is also complementary to the specific rules proposed by the Commission on 31 May
2017
16
for the application of posting rules to workers in road transport. This proposal
addresses the risks of inadequate working conditions for drivers, including terms and
conditions of employment, and at the same time mitigating the excessive regulatory burdens
on operators and preventing distortions of competition. The overarching goal is to ensure a
balance between adequate working conditions for drivers and freedom to provide cross-
border services for operators.
2.2.
Market Context
The international and national markets for inter-urban regular coach services play an
important role in passenger transport. Coach is an economical, efficient and sustainable
17
mode of transport which can contribute to reducing emissions from transport and to
improving accessibility for citizens on low income or living in isolated and low
population density regions with no rail services.
In 2014, the bus and coach transport activity (expressed in passenger-kilometre)
represented 8.0% of passenger transport and 8.8% of land passenger transport within the
EU
18
.
Table 2-3: Modal split of passenger transport 2014
19
Modal split of passenger transport in 2014
Passenger car
72.3%
Powered 2
wheel
1.9%
Bus and
coach
8.0%
Railway
6.5%
Tram &
Metro
1.5%
Air
9.2%
Sea
0.6%
OJ L 18, 21.1.1997, p. 1
Proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending
Directive 2006/22/EC as regards enforcement requirements and laying down specific rules with
respect to Directive 96/71/EC and Directive 2014/67/EU for posting drivers in the road transport
sector Brussels, 31.5.2017 COM(2017) 278 final 2017/0121 (COD)
17
Coach has lowest CO2 emissions of all long distance modes (with E-trains) Bus and coach transport for
greening mobility, Delft, October 2011
18
Data from Statistical Pocketbook 2016 EU Transport in figures
19
The modal split indicator is based on passenger transport activity expressed in passenger-kilometres.
16
15
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Modal split of passenger transport on land in 2014
80.1%
2.1%
8.8%
7.2%
1.7%
Source: Statistical Pocketbook 2016 EU Transport in figures
Although the sector’s share of the land passenger transport market has grown by 0.4%
since 2009, these high level statistics do not accurately describe the different types of
coach and bus services within the scope of the Regulation. The scope, quality and
availability of data vary widely across Member States. There are inconsistencies across
Member States in the definition of services (regular, international regular, special regular
and occasional) and the distinction between bus (usually urban) and coach services
(usually inter-urban). Vehicle-kilometres and passenger-kilometres (pkm) are reported in
different and mutually inconsistent ways by different Member States. The statistics
available at the European and Member State levels frequently refer to all bus and coach
services together. While some statistics are available at an aggregate level (and usually
conflate both bus and coach operations) there are few statistics available for sub-sections
of the market, e.g. medium or long distance coach services.
As shown in table 2-4, 14 Member States have some competition on the market for
regular services accounting for an estimated 278 billion pkm. However, these Member
States often still restrict the scope of inter-urban coach services by reference to a
geographical market definition or a distance threshold; or by withholding permission to
operate following an analysis of the impact of the proposed service on established
operators; or by requiring operators to establish locally; or in some cases they rely on
services provided under public service contracts
20
(PSC) to supplement commerically
operated networks and protect these PSCs from competition. These will be described
further in section 2.5.1. Moreover, as desbribed in section 2.3, restrictions in a broader
sense can be exacerbated by discrimination in access to bus and coach terminals (see
section 2.3).
There are a further 7 Member States with periodic tendering of concessions (competition
for the market) accounting for 71 billion pkm and 7 Member States continue to limit
competition considerably representing 30 billion pkm.
Table 2-4: National market size and market liberalisation in the EU
Continue to limit
competition
considerably
Some
competition for
the
market/
Concessions
Some
competition on
the market/ open
access services
Member State
Market size in 2015
(billion pkm)
Austria
Belgium
Bulgaria
Croatia
Cyprus
Czech Republic
Denmark
20
6.9
13.3
7.6
3.0
1.1
15.5
4.9
See page iv for definition
5
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Continue to limit
competition
considerably
Some
competition for
the
market/
Concessions
Some
competition on
the market/ open
access services
Member State
Market size in 2015
(billion pkm)
Estonia
Finland
France
Germany
Greece
Hungary
Ireland
Italy
Latvia
Lithuania
Luxembourg
Malta
Netherlands
Poland
Portugal
Romania
Slovenia
Slovak Republic
Spain
Sweden
United Kingdom
1.5
4.4
34.4
45.1
13.5
14.7
5.1
77.0
1.6
2.4
0.4
0.4
7.9
32.2
5.3
10.6
1.8
4.8
36.6
4.9
26.2
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave.
The international market for regular services is small compared to the domestic market
but it appears to be growing. It is estimated that international regular service passenger
numbers grew by 40-60% and international coach pkm
21
grew by between 0-40%,
between 2009 and 2014
22
. The domestic market in 2014 is broadly similar, and possibly
slightly larger, than the market in 2009. The data suggests that the average international
coach trip is getting shorter. It is estimated that there are several tens of millions of
passengers per year travelling, on average several hundred kilometres each. This stronger
growth in international markets relative to the overall market suggests that operators have
responded to opportunities provided by international liberalisation.
In 2013 there were 43,352 enterprises operating bus and coach services in both national
and international markets (not including urban or suburban services) with 497,800
employees
23
.
A passenger-kilometre is the unit of measurement representing the transport of one passenger by a
defined mode of transport over one kilometre
22
Comprehensive Study on Passenger Transport in Europe, Steer Davies Gleave, April 2016
23
Estimated using EUROSTAT structural business statistics "other
passenger land transport n.e.c. (not
elsewhere categorised)".
It is cautioned that this classification of economic activity is indicative as it
includes more forms of land transport than coach.
21
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Many coach brands are a marketing alliance or partnership, managed by one operator and
operated by several companies or by subcontractors. Many coach companies are domestic
subsidiaries of foreign owning groups, and the ultimate ownership of individual coach
operators may depend on mergers and acquisitions activity among a more limited number
of parent companies including rail companies (e.g. Deutsche Bahn AG and SNCF) and
major transport groups (e.g. Arriva and National Express).
Coach operators can add and remove routes relatively easily, allowing them to enter
markets on a trial basis, or to modify services rapidly as markets change. The provision of
the services, and their relative success, will generally depend on the characteristics of the
competing modes. International coach services and networks are dynamic, with
competition sometimes leading to price wars and subsequent withdrawal of one or more
operators.
2.3.
Evaluation of the Regulation
The ex-post evaluation of the Regulation which was carried out from 2015 to 2017
24
concluded that the Regulation has contributed to the establishment of a more coherent
framework for international services by coach and bus, including cabotage operations.
The opening of the international market for regular services has resulted in improvements
in the level of service with growth in the number of operators, numbers of passengers and
the number of services in the EU. There was substantial growth in certain Member
States, notably Czech Republic, Estonia and Poland, over the period 2009-2014 and the
only Member State with data available that reported a decrease over this period was
Slovenia. However, it has proved difficult to find evidence that directly links increase in
activity to the introduction of the Regulation and some of the evidence is largely
anecdotal and insufficient to demonstrate a causal relationship. There is conclusive
evidence that the liberalisation of national markets by MSs in combination with the
liberalisation of international services by the Regulation created a favourable
environment for the expansion of coach services at national and international level. The
opening of national markets for regular services in countries such as Italy, Germany and
France that followed the liberalisation of international services triggered the expansion of
some transport operators and enhanced the provision of new international services. It
appears that once a national market for regular service is established, operators tend to
exploit their national position through offering services to neighbouring countries.
The available evidence indicates that the Regulation has not had any discernible effect on
the volume of employment. No conclusion could be drawn regarding the evolution of the
working conditions of drivers.
Despite its achievements, the inter-urban coach and bus sector has failed to grow at a rate
comparable to that of other transport modes and its modal share has continued to decline
over an extended period. There are different explanations to this but very importantly, as
described below; it appears that international services, without competitive inter-urban
services, constitute less appealing service offerings to users.
The evaluation has shown that the intended modal shift from passenger car to coach
and bus services didn’t materialise to the anticipated extent.
The anticipated impact
was a more sustainable modal mix in passenger transport. The aim was to promote
24
The Commission published a Staff Working Document with the results of the evaluation: insert link to
SWD
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passenger transport sustainability by shifting traffic volumes away from car. These
expectations were largely based on an over-optimistic assumption that the promotion of
bus alone would change passengers' modal choices. In fact, the coach sector has failed to
grow at a rate comparable to that of passenger cars and its passenger transport share
continued to decline over an extended period. However, the problems of pollution,
congestion and road safety that should have been addressed by the original objective of
promoting coach and bus services as a sustainable alternative to individual car transport)
still exist and remain valid. Furthermore, the evaluation identified the lack of an
attractive mix of affordable alternative transport modes for citizens as a new and
at
least - equally urgent challenge.
The original Regulation did not aim at integrating national markets for regular services.
However, the latter are recognised in the evaluation as a critical factor in the provision of
international services. The evolution of the market, in terms of different and divergent
rules on access to national markets in Member States, is a problem that was not
previously apparent or considered when the intervention was designed. This patchwork
of regulatory systems in the EU makes it difficult for carriers to exploit the full potential
of operating in an Internal Market, impedes integration and undermines the efficiency of
coach and bus services.
The scope of the objectives of the original Regulation did not cover the problem of
discrimination in access to terminals. Yet, without non-discriminatory access to
terminals, bus and coach operators are forced to stop at the road-side, which diminishes
the quality of service provided to users. Moreover, terminals serve a vital role acting as a
hub in a network enabling passengers to change coach or acting as a multimodal hub
enabling passengers to transfer to another collective mode of transport. The evaluation
found evidence of discriminatory access to terminals in Austria, Czech Republic, France,
Croatia and the UK which distorts service patterns and limits the possibility of operators
to adapt services to passenger demand. The accessibility to terminals as well as the extent
to which the terminals are linked to other modes of transport is particularly important for
international regular services.
2.4.
Problem definition
Following the ex-post evaluation, further Commission work and stakeholder
consultations, two main problems were identified. The main problems are:
operators are
facing obstacles in national markets to develop inter-urban
coach services,
and
the
low modal share of sustainable transport modes
25
.
The effects of these problems for citizens are described in figure 2-1. In non-liberalised
markets this
contributes to the transport disadvantage of certain groups of citizens.
Furthermore citizens in general are
faced with a lack of connectivity and non–
integrated services.
In particular, the ability of citizens in disadvantaged regions that are
more sensitive to the price of transport, and to purchase end-to-end tickets from a
competitive pan-European operator could substantially improve their access to
employment, education and leisure opportunities.
25
Of modes that are competing on inter-urban transport, coach and trains are the most energy efficient and
produce the least CO
2
emissions (Bus and coach transport greening mobility, CE Delft 2011).
8
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The evaluation concluded that operators are faced with a wide range of restrictions on
access to national inter-urban markets even in Member States that have introduced
different forms of market liberalisation. The date of most recent liberalisation relating to
national markets for regular services varies widely, from 1980 in the UK to 2015 in
France. Partly as a consequence, both the type of services which have been liberalised
and the extent of the liberalisation vary widely between Member States. For example:
Some create a number of regional concessions competitively, with exclusive
rights to operate services (e.g. Spain).
Some permit commercial operations, subject
to rules designed to protect PSC’s
(e.g. France)
Some permit commercial operations carrying passengers beyond a minimum
distance (e.g. United Kingdom).
Some delegate responsibility to regional, county or municipal authorities (e.g.
Germany).
9
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Figure 2-1: Problem Tree
10
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In these liberalised national markets, restrictions therefore include inter alia the
prohibition of services below a certain distance threshold or prohibition of cabotage
services or withholding permission to operate due to negative impacts on established
operators. Operators encounter additional problems due to the excessive time taken to
grant or refuse an authorisation following a procedure with little or no transparency.
Some Member States continue to require that operators establish locally forcing them to
adopt different business models to overcome this restriction.
In the 14 Member States with non-liberalised markets (see table 2-4) there are a wide
range of restrictions on access to markets for inter-urban services. These restrictions
originated from a variety of different sources including Member States protecting rail,
protecting incumbent operators, protecting PSC’s, or putting in place market access
arrangements that are considered to better reflect the local circumstances. This means
that barriers to market entry exist at a number of levels, ranging from tight national
control of services, through regional awards of concessions with exclusive rights
(whether directly awarded or competitively tendered), to local requirements for, or
prohibitions on, stopping in particular locations.
The number and diversity of regulatory frameworks and authorising procedures across
the EU imposes excessive administrative costs on operators seeking to provide regular
services in more than one domestic market. Furthermore the range of authorising
procedures deters coach operators from providing international services as in reality
national and international are interlinked and in turn integrated with other modes of
transport.
Discrimination in access to terminals is a common problem across the EU.
A review
of a number of cases investigated by competition authorities in different Member States
provided information on whether the actions of particular transport and terminal
operators were anti-competitive
26
. These cases demonstrate the variety of different
problems and their impacts on the services provided by competing coach operators
including:
Refusal to grant access to competitive terms can prevent a competitor from
introducing a new service on a given route;
A decision by a terminal owner to also access to a single preferred supplier can
have the effect of displacing even an established competitor;
A decision by incumbent coach operator to vacate a terminal in favour of a new
facility can have the effect of undermining the services of competitors who
remain.
They also demonstrate that reaching a decision in a case involving abuse of a dominant
position and anti-competitive behaviour can take several years.
The UK based operator association Confederation of Passenger Transport (CPT) stated during the
consultation that terminal access was a major concern. They suggested that there should be an EU-wide
regulation requiring Member States to adopt appropriate measures to enhance and manage terminal
capacity.
26
See table 3.3 Support Study for the IA for the Revision of Regulation 1073/2009 Steer Davies Gleave
11
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Coach services have the potential to provide transport opportunities that match the needs
of these disadvantaged groups of citizens, typically without passenger cars, as it can offer
low fares and a large network of services.
In 2014 passenger cars accounted for 83.4 % of inland passenger transport whilst the
more sustainable collective modes of transport (train, coach, bus, metro and tram)
accounted for only 16.7%. Over the period 2004 to 2014 the relative importance of the
use of passenger cars was quite stable, with its share always within the range of 83% to
83.7%. This indicates that the more sustainable collective transport modes have not been
able to reduce the relative importance of the use of passenger cars.
The decline in the modal share of coach services has to be seen in the context of the
very wide potential for such services.
The potential for the development of the network
of coach services is linked to the density of the road network in the EU. The greater
density of the road network should enable coach operators to develop more extensive and
complex networks, to provide services to more cities, and to provide more services to
rural areas that are not served by, or accessible to rail, air or maritime transport. Figure 2-
2 illustrates that the road density in each MS is much greater than that of the rail network.
Figure 2-2: Density of the total road (km road/km
2
land area) and rail (km rail/km
2
land area)
27
networks
6%
5%
4%
3%
2%
1%
0%
BE BG CZ DK DE EE IE EL ES FR HR IT LV LT LU HU NL AT PL PT RO SI SK FI SE UK
Density road network
Density rail network
Source: Adapted from Statistical Pocketbook 2016 EU Transport in figures
Expansion of the network of coach services could improve the connectivity of
disadvantaged regions and supplement existing bus and rail networks.
Figure 2-3
shows the GDP (Gross Domestic Product) per capita (measured by purchasing power
rates) in NUTS-2
28
regions across the EU, with locations served by Flixbus’s network
overlaid. Since commencing the expansion of its network beyond its home Member State
(Germany) in 2015 Flixbus has developed one of Europe’s largest long-distance
coach
and bus networks. The figure shows that the expansion has been heavily concentrated in
recently liberalised markets (France and Italy) that served as the stepping stone for the
uptake of bus and coach services both at national and international level. It also clearly
shows that network expansion has been constrained significantly, in countries such as
Greece and Spain where national markets are still closed despite the presence of well-
established industries in tourism expected to generate significant levels of coach traffic.
27
28
CY and MT are not included as they do not have rail networks
Please see
http://ec.europa.eu/eurostat/web/nuts/overview
for an overview of NUTS-2 (Nomenclature of
territorial units for statistics)
12
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However it also shows that currently, there are relatively few locations in disadvantaged
NUTS-2
regions with GDP per capita of less than €20,000 (e.g. in Poland, the Slovak
Republic, Hungary, Romania and Bulgaria) covered by the network of coach services.
This suggests that an expansion of the network to the east could improve the connectivity
of several more disadvantages NUTS-2 regions and supplement existing bus and rail
networks even in Member States with liberalised markets (e.g. in Poland, the Slovak
Republic, Romania and Bulgaria). As described above, better and more integrated service
offerings to users from disadvantaged regions via the possibility to purchase end-to-end
tickets could substantially improve their access to employment, education and leisure
opportunities.
Figure 2-3 GDP per capita by NUTS-2 region and the Flixbus network
Source: Comprehensive study on passenger transport by coach, Steer Davies Gleave, April
2016.
The Special Eurobarometer Report on Coach Services
29
(hereinafter “the Eurobarometer
Report”) survey indicates that the
pricing of coach services is an important factor
in
the mode-choice of both non-users and economically disadvantaged users. More
specifically, the socio-demographic breakdown shows a notable difference between the
average non-user and non-users from disadvantaged groups. For example, on average
26% of respondents would be more likely to use coach services if fares were lower. This
increases to 35% of people with difficulty paying bills most of the time, 31% who have
difficulty paying bills from time to time, 36% of respondents still studying and 34% of
respondents aged 15-24.
Restrictions to the provision of inter-urban coach services in national markets seem to
lead to low service quality and higher fares. Table 2-5 describes the impacts on inter-
urban coach services in Member States that have recently liberalised their markets to
promote travel by coach. The results demonstrate that
fares can be as much as 20%
more expensive on routes where the provision of coach services is restricted
than on
29
http://ec.europa.eu/commfrontoffice/publicopinion/index.cfm/Survey/getSurveyDetail/instruments/SP
ECIAL/surveyKy/2144
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routes where there is competition. It also demonstrates that service quality was lower, the
number and frequency of services was lower, the size of the route network was smaller
(with less accessibility), and less on-board services were provided e.g. less provision of
Wi-Fi.
Table 2-5: Impact of liberalisation on fares and service quality
Study
Member
State
Impact of liberalisation
Identified a statistical relationship between level of market
concentration and fare offered indicating that actual competition is an
important determinant of fare levels. Also, the threat of new entry
alone was sufficient to constrain the fares offered by incumbents.
Fro the usto er s perspe ti e, oa h arket li eralisatio has
already improved standards and choice. Increase in number of services
and service frequencies. Coach services are now being promoted more
actively, with services marketed on the size of the route network,
better value for money and the environmental benefits of coach travel.
Open access to routes can have a significant impact on fare
competition. It suggests that fares on routes served by three operators
are 17% lower than on monopoly routes.
Gradual decline in tariffs and greater innovation in the interests of
passengers (e.g. web-based ticketing & provision of Wi-Fi).
New entrants introducing pricing strategies based on airline-style yield
management with substantial discounts available for early booking, in
contrast to the more rigid, distance based fares strategies that are still
pursued by established incumbents.
Augustin
(2013)
30
Germany
France
Deman
31
Germany
Italy
Dürr
and
Hüschelrath
(2015)
32
Gipp
(2016)
33
Grimaldi et
al (2016)
34
Germany
Germany
Italy
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
In principle, the benefits of opening access described above serve to demonstrate the
benefits foregone in Member States in which there is little or no competition between
operators. The evidence on the effects of competition to date, coupled with the
Contestability of the long distance German coach market, Katrin Augustin, KCW GmbH, European
Transport Conference 2013.
31
Liberalisation of passenger transport in Europe and its consequences for the fleet, Jan Deman, Director
of Busworld Academy.
32
Niklas S Dürr and Kai Hüschelrath, Competition in the German Interurban Bus Industry: A Snapshot
Two Years After Liberalisation, Centre for European Economic Research, August 2015.
33
Economic Lessons from the Liberalization of the German Bus Market, Christoph Gipp, IGES Institut
GmbH, March 2016.
34
Intercity coach liberalisation - the cases of Germany and Italy, Raffaele Grimaldi, Katrin Augustin, Paolo
Beria, World Conference on Transport Research, July 2016.
30
14
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demonstrable restrictions on market access in many Member States, suggest there is
considerable scope for improving the competitiveness of the sector from the perspective
of passengers. Greater competition within national markets would result in lower and
more innovative fares, more efficient promotion of coach and bus regular services.
The 2011 White Paper calls for greater integration of modal networks to provide
passengers with better modal choice. Passengers are less likely to use coach services if
they do not connect with other coach services or sustainable modes of transport or if the
connections provided are not convenient. The range of facilities (such as well-signed
interchanges, and relevant and accessible passenger information) and onward
connectivity which the majority of coach terminals provide makes them particularly
attractive, and important, for passengers.
R
estrictions on access to terminals are widespread and that they have a material impact on the services
provided to operators and passengers.
For example, during the targeted consultation exercise t
he
operators National Express and Megabus confirmed the importance of serving terminals that enable
interchange with other modes. National Express also highlighted the importance of ensuring connectivity
between international and national coach services.
The evidence indicates that the provision, standards, ownership and regulation of terminals vary widely
between Member States, within Member States, and even within the same city. This variety of conditions
makes access to terminals and integration with other modes complex and difficult.
The IRU stated that there is a general lack of integrated terminal facilities supporting door-to-door
t a spo t a d u de i i g the a ilit of ope ato s to eet usto e ’s eeds. Othe ope ato stakeholde s
stated that roadside stops are not appropriate for encouraging multi-modal travel. Fewer than one in six
respondents (13%) in the Eurobarometer Report gave good connections with other transport services as a
reason for using coach services.
The European Disability Forum (EDF) confirmed that multi-modal terminals are particularly important for
persons with reduced mobility (PRMs) who rely on being able to transfer between modes easily. The
Eurobarometer Report indicates that of the respondents that use coach services one in ten respondents
stated they use coach services to travel to or from airports and a further 7% use the services to travel to or
from rail stations. Of the non-users of coach services 21% reported they would be more likely to use the
services if there was a more extensive network of routes and stations and better connections with other
transport modes.
Consequences of problems
Situations of transport disadvantage, or low levels of accessibility, occur when there is
little or no access to public transport or other transport modes, which restricts mobility
and access to employment, education and leisure opportunities. This, in addition,
disproportionately impacts on certain disadvantaged groups
35
of citizens.
Similarly to inter-urban services, there is evidence that the accessibility to long distance
services is associated with income levels
36
. In other words, citizens with high levels of
income generally have access to much improved mobility services.
35
Disadvantaged groups include those sensitive to the price of transport, low income, those in education
and training, unemployed, young people, old people, people with restricted mobility (PRMs), disabled
people, those living in disadvantage areas, living in isolated regions, and households with no access to
a car and living outside urban areas.
http://publications.jrc.ec.europa.eu/repository/bitstream/JRC96151/jrc96151_final version 2nd
correction.pdf
36
15
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The lack of inter-urban mobility for economically disadvantaged groups is a problem
because these citizens may not be able to participate in key activities such as education,
job, visiting family and friends, healthcare and in general suffer social exclusion.
2.5.
What are the problem drivers?
As indicated in the problem tree, figure 2.1, there are three underlying problem drivers
affecting the two main problems of
operators’ facing
obstacles in national markets to
develop inter-urban coach services,
and a
persistent low modal share of sustainable
passenger transport modes.
2.5.1.
Problem driver 1: Restricted access to national inter-urban markets
The regulatory frameworks for national coach services vary widely between the Member
States. In some cases access to markets is directly restricted through the award of
contracts to monopoly service providers. This both eliminates the scope for competition
on individual routes and substantially hinders the development of international
commercial services and networks. For example, in Greece contracts are awarded
directly to operators within KTEL, a jointly funded group of companies and in Spain
contracts are competitively tendered, with operators only periodically being subjected to
competitive discipline. Restrictions may also stem from interactions with rail services,
which Member States in certain cases protect as these are considered to be more
environmental friendly.
As shown in table 2-4 above, there are 14 Member States who limit competition on their
markets accounting for in excess of 100 billion pkm. These Member States can exclude
operators entirely from potential markets or award PSCs which favour incumbent
operators and prevent potential new entrants from competing on equal terms (e.g.
Austria, Belgium, Greece and Spain). By definition, the award of monopoly contracts
effectively eliminates the scope for competition on individual routes. It can also
substantially constrain the development of international networks. Even where contracts
are subject to competitive procurement, the cost and uncertainty of mounting a bid to
operate an entire route network will discourage potential market entrants who would
otherwise have tested commercial opportunities through more limited market entry. The
length of concession contracts also limits the opportunities for new entry.
As mentioned above restrictions also occur on liberalised national markets including: a
prohibition of services below a certain distance threshold (e.g. France and Germany);
withholding permission to operate following an analysis of the impact of the proposed
service on an established operator (e.g. Ireland and Estonia); and prohibitions on certain
types of services, for example cabotage operations, in Latvia. The application of these
different approaches to protect PSCs makes it difficult for operators to plan new services.
Operators have reported during the stakeholder consultation that even in liberalised markets they
encounter problems due to the excessive time taken to grant or refuse an authorisation and that there is
little or no transparency in authorisation procedures especially in the application of mechanisms to protect
PSCs.
Restrictions on market entry can
be exacerbated through the process of awarding PSC’s,
which may favour incumbent operators and prevent potential new entrants from
competing on equal terms.
For example, BusUp, a provider of occasional and discretionary coach services, noted that both existing
and new contracts are often tendered on terms that only established operators can meet. It stated that
16
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the large size of concessions in Spain resulted in difficulties for SMEs bidding for them. Similarly, the Coach
Tourism and Transport Council of Ireland has suggested that the pre-qualification criteria for bidding for
e e t PSC’s e e su h as to p e lude the ajo it of p i ate ope ato s.
Limiting the number of bidders in this way may mean that new operators are prevented
from extending their networks even where they are prepared to operate services under
PSC and meet contractual requirements defined by regional and local authorities.
Member States that have liberalised national regular services always continue to require
that operators establish locally and have not taken the opportunity to decide that the
Community licence shall be valid for national transport operations under the provisions
of Regulation 1073/2009. This forces operators to adopt different business models to
overcome this restriction. The business models include contracting services to local
operators and establishing subsidiaries. Operators have confirmed that the costs of
circumventing local establishment requirements can be significant, even for large
operators. The biggest perceived negative impact of the requirement to establish locally
is the associated administrative costs for the carrier. 81% of the 36 carriers that
responded to the open public consultation (OPC) identified these costs as having a
negative impact.
Stakeholders responding to the OPC generally agreed that restrictions on access to national markets for
regular services are a problem. Of the 153 respondents, 33% agreed that it is a major problem and 27%
stated it is a minor problem. 67% of the 45 operators responded that the restrictions have a negative
impact on their ability to expand into new markets and none expressed the view that they had a positive
impact.
Public Service Contracts
Some public passenger transport services that society needs as part of its general interest
cannot be run commercially, so the competent national, regional or local EU authorities
must be able to make certain they are provided. Competent authorities can do this:
by awarding exclusive rights to operators running public services, compensating them
financially. This usually takes the form of bundling profitable and non-profitable
routes together so that the profitable routes cross-subsidise the non-profitable routes,
and also
by defining rules (i.e. public service obligations) for how public transport should be
operated. For instance, public subsidies can be granted for the provision of
transportation services, particularly for low-density routes, usually connecting rural
areas. Such subsidies can be granted both to railway and coach services. As a
reference, the total amount of subsidies granted for the compensation of railways
PSOs in the European Union in 2015 amounted to EUR 20 billion.
Article 14 of the Treaty on the Functioning of the European Union (TFEU) and Protocol
No 26 on services of general interest annexed to the TFEU sets out the general principles
of how Member States define and provide services of general economic interest. The EU
has developed legislation to avoid disparities between Member States in the procedures
and conditions they apply to the execution of public service obligations.
17
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Evidence from a previous study
37
indicates that there is little consistency across Member
States in terms of the size of the area of competence of the competent authorities which
organise public transport and PSCs. In smaller or island Member States the authorities
tend to be national, whilst in many Member State there can be a large number of
authorities. Some states have authorities in charge of transport at a regional level,
including Belgium, Germany, Czech Republic, Denmark, Croatia, Italy, Spain, Slovakia
and Sweden. There is nothing to prevent authorities of national competence to manage
many distinct contracts. However, in the case of Ireland, Cyprus and Malta, there are
only a limited number of public service contracts in use.
The opening of access to the national market for regular services would enable operators
to provide new services which, if attractive, will both:
provide welfare benefits to new passengers who would not otherwise
travelled; and
have
take passengers from existing services, reducing the revenues of existing
operators and incentivising them, where possible, to improve quality and lower
fares, reduce costs, or cut services.
Where new services effect existing services provided under a PSC, Member States and
competent authorities are likely to be concerned if the first effect “generation” (of
revenues through newly generated demand for bus and coach services) is small compared
to the second effect “abstraction” (of
revenues from existing operators).
Currently there are a number of different approaches to protecting PSC’s based on
restricting or limiting new entry. These are:
Regulation 1073/2009 requires that international coach services be authorised
except on the
basis of detailed analysis of their effect on one or more PSC’s.
Regulation 1370/2009 permits exclusive rights to protect any PSO provided by in
particular any land transport mode.
Directive 2012/34 as amended Directive 2016/2370 requires that international and
domestic rail services may be limited to protect the economic equilibrium of a
PSC applicable to the same or an alternative route.
Each of the options described in section 5 dealing with PSCs will continue to provide
Member States with the capability to protect PSCs whilst also providing carriers with
transparency together with clear, simple and rapid procedures to address demand.
During stakeholder consultation 9 out of the 13 Member States that replied reported that they were
concerned about the potential adverse impact on services operated under PSCs. To address these concerns
all easu es deali g ith a ket a ess i lude a easu e to p ote t PSC’s.
2.5.2.
Problem driver 2: Excessive administrative costs of entry
We have identified extensive evidence that administrative costs incurred by operators can
be material and that administrative processes can delay entry. It is also clear that the
requirements for the authorisation of national and international regular services can vary
significantly by Member State.
37
Study on economic and financial effects of the implementation of Regulation 1370/2007 on public passenger transport services by Steer
Davies Gleave 2016
18
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Operators face excessive costs of entry in national and international markets due to
national and local authorisation procedures and requirements including in the case of
applications to operate international services under the Regulation.
In Germany the application process can take up to four months with different procedures in different
Länder. The authorisation procedures for international and national regular services involve protracted
paper-based administrative procedures with both large and small operators acknowledging that this
process favours larger established operators who are well placed to understand national requirements
and processes. Operators also highlighted the importance of language barriers and the need for
translators to communicate requirements and complete application forms.
Coach operators who carry out international occasional services, such as group tours to
holiday destinations, require a journey form. The journey form holds information about
the type of transport on the one hand and about destination, route and passengers on the
other hand. The journey form generates an unnecessary administrative burden for
operators.
The REFIT Platform has considered a submission from the Dutch Ministry of Infrastructure and
Environment on the elimination of the journey form
38
clearly shows mixed views. The Stakeholder group
considers that the journey form has lost its relevance, generates unnecessary administrative burden for
many operators, in particular SME’s and recommends its removal.
Within the Government group, views are divided. While a few Member States consider that the abolition of
the journey form would reduce regulatory burden for both carriers and Member States, the majority of
Member States see the journey form as an effective control tool to complement tachographs which needs to
be maintained.
In the OPC 75% of the 65 companies and 78% of the 27 non-governmental organisations stated that the
journey forms serve no useful purpose. Although 12 Member States indicated that they do not support
abolishing the form the reasons provided are inconsistent with the experience in Denmark, Finland,
Norway and Sweden who abolished the obligation of the journey form for operators that have their
business establishment in their countries in 2003 and there have been no negative consequences for road
inspections.
The estimated administrative burden of market entry for authorisation and journey form
are provided in the table below:
Table 2-6: Estimates of the administrative costs of market entry
Process
Source of costs
Time
Comment
Authorisation Resources used by
Three days Based on stakeholder comments concerning need
operator to complete
for translation and consultancy advice
application
The delay in the reply Two
Stakeholders have indicated that elapsed time for
to the application for
months
approval can be four months but that two months
authorisation
would be more appropriate
Resources used by
Five days
Elapsed time of four months suggests significant
national authority to
number of days’ effort
process application
Journey form Time taken for
Less than
No reason to modify this estimate based on
operator/driver to
one hour
evidence to date
complete journey
form
Resources used by
Five
Inspection time proportionate to time to complete
national authority on
minutes
the form. Inspection rate of 10% gives sufficiently
inspection
10% of
high likelihood of inspection to encourage
38
See
https://ec.europa.eu/info/sites/info/files/xv9apassengertransport.pdf
19
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forms
inspected
compliance
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
Some Member States have taken action to reduce the administrative burden. For
example, the abolition of the use of journey forms in Nordic Member States. Operators or
national authorities do not record the administrative cost systematically but there is
extensive evidence that the costs incurred can be material and that administrative
processes can delay entry for operators.
2.5.3.
Problem driver 3: Restricted access to key infrastructure
Terminals provide connectivity to the network of coach services and serve as a place of
interchange between coach services. They also act as an interface between the network of
coach services and urban, rail, air or maritime networks. The provision of terminals in the
EU is variable. Some Member States appear to expect or require the competent national,
regional or local authorities to provide terminals whilst others have no systematic
provision of terminals. There are several models of terminal ownership across the EU
including ownership by national, regional and local government, by operators, by the
railway infrastructure manager, by airports, privately and by other parties. In some
Member States the terminal ownership is irrelevant, because the coach market is highly
restricted or regulated and new coach services are not allowed to compete with existing
services or operators are not permitted to operate domestic regular services.
The success of inter-urban services depends largely on the extent to which they connect
with other modes of transport and the convenience of the connections provided. Access
to terminals is a factor that limits competition in the market. There is evidence (collected
during two 2016 studies
39,40
) that carriers face restrictions in access to key infrastructure
are common and widespread with instances identified in 14 Member States
41
. The issue
of equal access to terminals was investigated further during the targeted consultation
exercise as there is a particular risk that access to terminals may be a barrier to entry if
the company that manages the terminal is vertically integrated with one of the coach
operators. Where the terminal operator is independent of the coach operator, it is more
likely that they will treat operators equally, although this is not guaranteed and they may
still face incentives to protect the largest operator. The evidence indicates that restrictions
on terminal access are widespread and that they can materially impact on services.
Due to the decline in the coach market over an extended period the amount of terminal
capacity has increased particularly in central and eastern European States, where rapidly
increasing car ownership has reduced the demand for long distance coach travel.
However, there are still issues with access to terminals in other Member States.
Experience in Germany, following liberalisation of the market for regular services,
suggests that terminal access may become a problem after market opening when a rapid
expansion of services puts pressure on available resources. A key issue is, where there
are capacity restrictions, how is it decided to distribute slots between operators. This is
39
40
Comprehensive Study on Passenger Transport by Coach in Europe,
April 2016
https://ec.europa.eu/transport/sites/transport/files/modes/road/studies/doc/2016-04-passenger-transport-
by-coach-in-europe.pdf
41
Belgium, Bulgaria, Croatia, Czech Republic, Finland, France, Germany, Greece, Ireland, Italy, Latvia,
Slovakia, Sweden and UK
20
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not always transparent, and coach operators have been refused access to terminals on the
basis of capacity restrictions which were very unclear. The following table provides a
summary of some of the issues raised by stakeholders including operators, regulators and
ministries:
Table 2-7: Examples of restrictions on terminal access
Stakeholder
ARAFER
Remarks
Autorité de régulation des activités ferroviaires et routières cited a recent case in which
it was required to resolve a dispute concerning access to Beauvais airport. Initially, the
terminal operator failed to publish access rules, and while they were subsequently made
available, ARAFER considered that they were poorly written and that the objective of
the rules was open to question. At the time of writing there is an ongoing procedure,
whereby ARAFER is investigating whether the terminal operator has breached its legal
obligations.
Autorità di Regolazione dei trasporti highlighted a general lack of terminal capacity in
cities such as Rome and Torino. The terminals that are available are heavily congested
and it is difficult for new operators to gain access. ART also suggested that the lack of a
clear definition of terminals, setting out minimum standards for facilities, made it
difficult to enforce access.
It is bringing forward a Presidential Decree defining mandatory standards for different
categories of terminal to clarify the facilities that should be made available to operators.
It also referred to the construction of a new terminal at Elleonas, consolidating the
existing facilities at Kifisos and Liosia. This will provide capacity for international
services, which are currently not permitted to use the inter-city terminals.
Cited a case recently referred to them in which an operator complained that a regional
authority had refused to grant a licence because the city centre at one end of the
proposed route was congested. The Ministry subsequently confirmed that the licence
should be issued, but the example demonstrates how local restrictions can frustrate or at
least delay market entry.
Observed that while there is no discrimination in terminal access in Germany,
infrastructure designed for local public transport is not necessarily suited to longer
distance transport services. The Supreme Building Authority within the Bavarian
Ministry of the Interior also noted that local authorities must be permitted to determine
how the facilities that they owned were used to further their own transport objectives.
Confirmed that it preferred to use terminals rather than on-street stops, particularly
when passengers require inter-modal transport links. It noted that it had experienced
difficulties in gaining access to terminals owned and managed by railway operators,
citing Trenitalia’s refusal
to provide access to the terminal in Padua by way of example.
They also observed that there is no terminal in Brussels and that the city centre is
reserved for tourist coaches.
Noted difficulties in obtaining access to terminal facilities as well as on-street stops in
some French cities, and indicated that in some cases coaches had effectively been
prohibited from operating to city-centre locations.
Observed that there are generally insufficient public terminals across Europe, and that
several major cities including Amsterdam, Paris and Brussels do not have any public
terminals. In Austria, terminals tend to be owned by the rail operator and requests for
access can be refused, while in France they are increasingly being located outside of city
centres. Competitors are generally unwilling to share their terminals and they are
anyway frequently capacity constrained.
ART
Ministry of
Transport
Greece
Ministry of
Transport
Slovak
Republic
Ministry for
Transport for
Baden-
Würtemberg
Megabus
Ouibus
National
Express
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
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There is considerable evidence
42
that discrimination is a common problem in the EU and
occurs where terminal facilities are both privately and publicly owned. Discriminatory
behaviour in relation to privately owned terminals is more difficult to challenge from a
policy perspective, since the business case underpinning private sector investment may
depend on a single operator having exclusive use of the available capacity. Regulations
having the effect of providing a right of access to third parties whether set at the
European Union or national level could therefore have the effect of discouraging such
investment. For this reason, concerns about discrimination relating to privately owned
terminals are arguably better addressed through competition policy, whereby the relevant
authorities can assess the
merits of particular actions on the part of terminal owners’
case-by-case.
By contrast, discriminatory behaviour by the operators of publicly owned terminals is
more difficult to justify, since the underlying investment is more usually driven by
recognition of the importance of providing appropriate facilities to support good quality
public transport services within a country, region or city. Moreover, public terminal
facilities are often provided to ensure that passengers can interchange between transport
modes, an important consideration in the planning of many coach services.
The cases above, amongst others, demonstrate a variety of impacts that discriminatory
behaviour can have on carriers including: refusal to grant access on competitive terms
can prevent a competitor from introducing a new service on a given route; a decision by a
terminal owner to allow access to a single preferred supplier can have the effect of
displacing even an established competitor; and a decision by an incumbent bus and coach
operator to vacate a terminal in favour of a new facility can have the effect of
undermining the services of competitors who remain. They also demonstrate that in the
absence of applicable rules the time taken to reach a decision on cases involving abuse of
a dominant position and anti-competitive behaviour can take a number of years,
particularly if challenged in court.
In the OPC, 81% of the 32 operators stated that discrimination against new entrants in providing access to
terminals is a problem resulting in administrative costs for operators but it has not been possible to
quantify the costs.
In addition to the evidence gathered during the targeted consultation indicating that the
restrictions are widespread and that they have a material impact on the services provided
to operators and passengers, operators also reported that the various different structures
of ownership and the regulation of terminals across Member States make it difficult for
them and cause an unnecessary administrative burden. They find it difficult determine
who to contact, how capacity will be allocated, and how they will be charged by the
terminal operators across Member States.
Finally, there are two other root causes to the driver of restricted access to key transport
infrastructure: constrained terminal capacity; and restrictions on access to city centre
locations. At this stage, the Commission is not proposing to address these issues as the
question to what extent it is competent to do so first needs to be clarified. Transport is a
shared competence between the Union and the Member States and subsidiarity
considerations may come to play here. The Commission has launched a study on urban
42
See IA Support Study Table 3.3
22
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vehicle access restrictions (which should be available in autumn 2017) and, based on its
results, it will assess whether it is necessary to propose measures in this area or not.
2.6.
Who is affected by the problem, in what ways, and to what extent?
The excessive administrative costs, restricted access to national inter-urban markets and
restricted access to key transport infrastructure have a direct or indirect impact on the
following stakeholders:
Citizens / passengers:
face an inferior offer of services in terms of availability, cost,
quality and reliability. Regular services are not always adapted to meet passenger
demand. They are not fully benefiting from the affordable mobility offered by inter-urban
bus and coach services; in particular those who suffer transport disadvantage suffer
disproportionately and are more likely to experience reduced mobility. They are unable
to purchase end-to-end tickets to improve their access to employment, education and
leisure opportunities across the EU. Where coach and bus services are not available
citizens are also affected by worse air quality due to the on average higher emissions
from other inter-city passenger transport modes (except electric rail) and in particular
from car.
Road passenger transport operators:
new entrants face a patchwork of regulatory
requirements including restrictions or prohibitions on market entry and lose business
opportunities. Incumbent operators remain protected and gain business opportunities with
little or no incentive to innovate.
Terminal operators:
may continue to provide specific carriers with discriminatory
access giving them a competitive advantage on certain services, preventing effective
competition between carriers and constraining the development of an integrated coach
network.
Road passenger transport workers:
have a key interest in working conditions, pay and
employment conditions, health and safety in the workplace, training and professional
careers.
Public authorities
the problems affect the manner in which national competent
authorities interact with road passenger transport undertakings and terminal operators.
The problems also affect how public authorities provide for inter-urban passenger
transport e.g. commercially or in the general economic interest through PSCs.
2.7.
What is the EU dimension of the problem?
One of the Europeans Unions main transport policy objectives is to improve travel
possibilities across Europe and ensuring high-quality transport services for its citizens. In
that context one of the primary objectives of Regulation 1073/2009 is to increase the
level of performance of international coach and bus services. There is evidence
43
that the
opening of national markets for regular services by coach and bus has created a critical
mass of operators who also introduce international services, resulting in a greater impact
on the number of international routes and service frequencies than pan-European
legislation alone. This suggests that further opening of national markets would strengthen
the development of the international market for regular services, quite apart from any
benefits for passengers making national journeys.
43
Comprehensive Study on Passenger Transport by Coach in Europe, Steer Davies Gleave, April 2016,
23
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The problem drivers mentioned in the previous section are mainly due to the possibility
of Member States to adopt their own rules and restrictions with regard to access to their
national market for regular services. The different national approaches and the
restrictions in access to terminals constitute a barrier to the free movement of services in
the field of transport which is one of the goals of the Common Transport Policy. This
affects the effectiveness of the Internal Market in the field of passenger transport by road.
Carriers have been unable to compete fully in national inter-urban transport markets. This
has limited the sectors ability to grow market share relative to other modes. It has
prevented the development of a fully integrated market for inter-urban travel by bus and
coach, resulting in poor connectivity from some citizens, particularly those with limited
access to a private car or rail services. EU citizens have access to a poorer (in terms of
accessibility, frequency, price, comfort) than optimal mobility offer which affects the
free movement of persons in the EU. Indeed, while national restrictions on paper only
affect domestic transport, in reality domestic and cross-border connections are interlinked
and in turn integrated with other modes of transport to collectively constitute the
available passenger mobility offer inside the EU. Hence restrictions on domestic coach
services and access to terminals have far reaching consequences on the functioning of the
passenger transport sector in the whole EU and across all transport modes.
In the absence of harmonised rules at EU level, carriers operating in the EU regular
services are faced with excessive administrative costs of entry, a patchwork of access
rules and in discrimination in access to terminals. Simplifying administrative procedures,
removing restrictions on access to inter-urban markets through a harmonised legal
framework across the EU and preventing discriminatory access to public terminals would
contribute to solving the issues identified and facilitate inter-urban mobility for all
citizens by promoting coach travel.
2.8.
How would the problem evolve, all things being equal?
This section analyses how the problem would evolve, assuming the continuation of
existing policies and the implementation of already planned policy reforms. There is no
indication that Member States will introduce changes to existing provisions. However,
Member States will have witnessed the increase in passengers carried, total passenger
km, employment levels and the density of the network of coach services along with lower
fare prices in recently liberalised markets for national regular services (e.g. France,
Germany, Italy and Poland). In the absence of EU action some Member States may be
prompted to liberalise their markets according to different principles to improve
efficiency.
In the absence of further EU action, Member States may continue to maintain restrictions
on market and route access or excessive requirements e.g. the requirement of local
establishment. All things being equal and in the absence of any further liberalisation
measures at the EU or national level, it is estimated that by 2035, around 26% of the
market (equivalent to 108 billion pkm) will be subject to restricted access due to reliance
on concessions or direct restrictions on market access. There will also be restrictions to
market access for new entrants in the remaining 74% of the market that has to some
extent liberalised but continue to impose various restrictions, for example in order to
protect public services operated under PSCs.
24
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1815323_0029.png
The network of coach services will not expand and develop as operators will continue
failing to penetrate into restricted markets. There will continue to be a clear distinction
between international regular services and national regular services for inter-urban travel.
In restricted markets service frequencies are likely to continue to be low and passengers
will continue to have a poor choice of combinations of fares and service quality. Citizens
who are sensitive to the price of transport or who live in areas where restricted markets
have blocked the penetration of the network of coach services will suffer
disproportionately. They are more likely to experience reduced mobility; this is
especially the case for those with little or no access to other modes. The reduction in
mobility hampers their access to employment, education and leisure opportunities.
There are other potential developments described in table 2-8 which could have
significant implications for coach travel. It is difficult to quantify the impacts of these
developments on the bus and coach sector with any confidence, since their effect depends
on a wide range of uncertain factors such as economic conditions across Europe, the
extent of cost changes driven by new technology, changing attitudes to the application of
technology among both the travelling public and transport employees, and policy
responses at the local, regional, national and European level. The table below provides
commentary on possible implications for bus and coach services should the technological
development be implemented.
Table 2-8 - Possible impacts of new technology on the bus and coach sector
Technological
development
Autonomous
vehicles
Possible impacts
‘Platooning’ of vehicles on motorways and other major roads could improve
efficiency, reducing coach service fuel costs and emissions
Could enable increase in operational hours of vehicles
May enhance the attractiveness of travel by private car, for example by
relieving congestion and improving journey quality
Likely to reduce the carbon footprint of coach operations as well as other forms
of road travel
Could change the relative costs of different types of operation, for example
enabling the development of smaller fleets offering on-demand services (based
on further development of the BusUp model)
May strengthen the attractiveness of travel by private car by reducing costs
May enable service users to pay a single subscription fee allowing them to
access a wide range of transport services, reducing the benefits of a private car
relative to public transport
Analysis of data about user choice and local conditions would allow coach
operators to develop more user-focused services, operated to accommodate real
time traffic constraints
Would support improved on-board service offer, including entertainment and
services supporting more effective working on the move
Better real time coordination of coach and other transport services and more
extensive availability of integrated tickets/electronic payment
Alternative fuels
New
operating
models
Integrated
transport
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
The developments under current trends and adopted policies (i.e. baseline scenario) in
inter-urban coach transport activity, energy use and CO2 emissions, as well as revenues
and employment in the sector by 2030 are shown in the table below, assuming the
25
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continuation of existing policies. The development of the baseline scenario
44
is described
in detail in Annex 4
"Analytical models used in preparing the impact assessment"
,
together with the underlying assumptions.
Table 2-9: Baseline projections for inter-urban coach transport to 2030
Total average
annual change
Non-
liberalised
39
3
5
51
622
1,763
48
Total
589
30
73
1018
6,882
19,519
985
2015
2030
(%)
2.5%
1.9%
2.8%
3.3%
1.3%
1.1%
-1.6%
Projections for
2030
Liberalised
Passenger km
(billions)
Vehicle km
(billions)
Revenue (€
billions)
Employment
(000s)
Energy use (000
toe)
CO2 emissions
(000 t)
Accident costs (€
millions)
99
6
14
181
1,499
4,203
309
Type of national market
Transition
383
16
45
681
3,640
10,349
517
Concessions
68
5
8
105
1,121
3,204
110
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
It is estimated that continued discriminatory behaviour in relation to terminal access
could unduly constrain terminal capacity supporting some 1.5 billion vehicle kilometres
and could result in the suppression of around 400 million vehicle kilometres.
As mention in Section 2.5.2, the administrative costs incurred by operators can be
material and administrative processes can delay entry. It is clear that even the
requirements for authorisation of international services vary significantly by Member
State and nothing indicates this will change. It is estimated that the total administrative
costs on the coach sector is €884 million in 2015 (with 2/3 falling on operators and 1/3
falling on government and/or regulatory
bodies), rising to €1,288 million in 2030
45
.
3.
W
HY SHOULD THE
EU
ACT
?
3.1.
44
Legal Basis
45
The Baseline scenario builds on an update of the EU Reference scenario 2016 but additionally assumes
the implementation of the reform of the national regulatory frameworks for buses and coaches in
Germany, France, Italy and Poland. The updated EU Reference scenario 2016 includes some updates
in the technology costs assumptions (i.e. for light duty vehicles) and few policy measures adopted after
its cut-off date (end of 2014) like the Directive on Weights and Dimensions, the 4th Railways
Package, the NAIADES II Package, the Ports Package, the replacement of the New European Driving
Cycle (NEDC) test cycle by the new Worldwide harmonized Light-vehicles Test Procedure (WLTP).
It has been developed with the PRIMES-TREMOVE model (i.e. the same model used for the EU
Reference scenario 2016) by ICCS-E3MLab. A detailed description of this scenario is available in the
Impact Assessment accompanying the Proposal for a Directive amending Directive 1999/62/EC on the
charging of heavy goods vehicles for the use of certain infrastructures, SWD (2017) 180
[Support study for an Impact Assessment for the revision of Regulation (EC) No 1073/2009, Steer
Davies Gleave]
26
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The right of the EU to act in the field of transport is set out in the TFEU (Treaty on the
functioning of the European Union). According to Article 4 TFEU, transport is one of the
principal areas where shared competence between the Union and the Member States
applies.
The competence for this initiative derives from Title VI (Transport) of the TFEU, in
particular Article 91 which states,
inter alia
, that the European Parliament and the
Council shall lay down common rules applicable to international transport to or from the
territory of a Member State, or passing across the territory of one or more Member
States, as well as the conditions under which non-resident carriers may operate transport
services within a Member State. The applicability of Title VI to road transport is
stipulated in Article 100 TFEU.
As far as public service contracts are concerned, the measures considered under different
PSC options in this IA are geared towards providing flexibility to Member States. Article
14 and Protocol 26 of the Treaty confirm the place occupied by services of general
economic interest in the shared values of the Union. Under Article 106(2) of the Treaty
on the Functioning of the European Union (TFEU), companies that provide services that
are of general economic interest are subject to the rules of the Treaties, in particular to
the rules governing competition. But unlike other economic sectors, this Article does not
apply when compensation is paid for public service obligations in land transport. Instead,
this type of compensation is covered by Article 93 TFEU as a 'lex specialis' and is
applied according to the rules of Regulation 1370/2007 on public passenger transport
services by rail and by road
46
. It is not proposed to make any amendment to Regulation
1370/2007 and Member States can continue to act to ensure that services of general
economic interest continue to be provided. In this respect, the initiative presented will not
go further than allowed by the Treaty and will not impinge upon Member States' right to
specify public service obligations underlying to PSCs.
3.2.
Subsidiarity
In accordance with Article 5(3) of the Treaty on European Union (TEU) any EU action
should respect the principle of subsidiarity. This involves assessing two aspects.
3.2.1.
Necessity test
The necessity test assesses if the objectives of the proposed action can be sufficiently
achieved by Member States. The legitimate rights of Member States to take actions
which reflect their local, regional or national specificities, must not unduly restrict the
proper functioning of the internal transport market.
EU transport policy has always focused on overcoming obstacles between Member States
and creating a single European transport area with fair competition conditions for and
between the different forms of transport. This means not only dismantling cross-border
barriers but also integrating national markets in order to complete the internal market for
transport.
Across the EU there is a patchwork of rules for access to national markets for coach and
bus services. Carriers are required to comply with different rules in each Member State in
which they operate. These rules include restrictions on access to national inter-urban
46
OJ L 315, 03.12.2007, p. 1.
27
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markets which constrains carriers’ ability to develop services into pan-European
coach
networks and denies them the possibility to offer integration with other coach services
and transport modes.
The past has shown that Member States action at the national or lower level (Article 25
of the Regulation enables Member States to agree bilaterally or multilaterally to further
liberalise services) has not been sufficient to tackle the identified problems. Furthermore,
Member States acting alone cannot introduce or ensure the coherence and coordination of
uniform market access rules needed for the emergence of a genuine internal market for
road passenger transport. It is therefore necessary to provide rules at the EU level.
3.2.2.
EU added value test
The EU added value test assesses if the objectives of the proposed action can be better
achieved at Union level.
Since the 1980s, the EU has elaborated a framework of common rules and procedures
intended to open the European road transport market to competition. The approach has
been consistent with the objective of developing Europe’s transport sector and the EU is
best-placed to lay down common rules for the road passenger transport market that
guarantees carriers access to operate throughout the EU without discrimination. The
envisaged revision of the regulatory framework will streamline the national differences in
market access rules and provide carriers with predictable business conditions throughout
the EU, therefore removing distortions of competition and barriers to market access as
well as providing the ground to strengthen the internal market.
The envisaged revision should have an immediate and strong positive impact on the level
of accessibility for EU citizens some of whom will have access to an affordable mobility
offer for the first time. Additionally, but over the longer term, it will have a positive
impact on the external costs of transport due to the expected modal shift. The beneficial
effects of the modal shift from car and air together are greater than the negative
environmental impact associated with the generation of new traffic and the substitution
of some rail use in favour of coach travel. The performance of coach and rail combined is
improved leading to an increase in the modal share of sustainable transport modes.
The envisaged revision should lead to an increase in inter-urban travel with the benefit of
not having any adverse impact on the environment. It will facilitate the mobility of
citizens who otherwise could not afford to travel. It will reduce the negative externalities
of inter-urban passenger transport, such as emissions, accidents and fatalities, road
congestion as well as to improve the efficiency of use of transport resources.
Furthermore, the introduction of measures to ensure a level playing field in the allocation
of terminal capacity should lead to an uplift in capacity that is unduly suppressed by
discriminatrory behaviour in access to terminals.
The EU is by far the best placed to act to achieve an accessible and competitive inter-
urban coach passenger sector and a true internal market for road passenger transport as
these cannot be better achieved at national level. The proposal does not aim at total
liberalisation of domestic services and Member States may still limit the right of access
to national markets for regular services if a commercial service would compromise the
economic equilibrium of a public service contract.
4.
W
HAT SHOULD BE ACHIEVED
?
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4.1.
General policy objective
The proposed revision of Regulation 1073/2009 aims to resolve the problems of
operators facing obstacles in national markets to develop inter-urban coach services and
the low share of sustainable transport modes. The initiative aims at a proportionate
response to national obstacles to market entry whilst avoiding excessive intrusion into the
national markets.
Therefore the 2 general objectives (GOs) of the proposed revision have been defined as
follows:
GO1: Facilitate inter-urban mobility and connectivity for all citizens
GO2: Increase the modal share of sustainable transport modes
The GOs cover both national and international regular services, reflecting the potential
for operators to provide both kinds of services as part of an integrated European route
network.
It is in line with the political priority of the Commission for the period 2014-2019 to
create a fairer and deeper internal market and strengthened industrial base.
It is also in line with the 2011 White Paper which foresees an efficient single transport
area for multimodal intercity travel and transport, and recognises the need for the greater
use of bus and coaches and the requirement to link the modal networks so they provide
better modal choices for passengers.
4.2.
Specific objectives
To achieve the GO the following 3 specific objectives (SO) have been developed. The
SOs align with the three problem drivers defined in section 2.5.
SO1: Simplify administrative procedures
This SO aims to address the problem of excessive administrative costs of entry, defined
in section 2.5.2, by clarifying and simplifying administrative procedures including the
procedure for authorising regular services.
SO2: Remove restrictions on access to inter-urban markets
This SO aims to address the problem of restricted access to national inter-urban markets,
defined in section 2.5.1, by removing legal barriers to market access and stimulating
competition in the national inter-urban markets.
The majority of respondents to the OPC considered that establishing a common framework in the EU for
access to national markets for regular services would contribute to improving the market for coach
services (65%).
SO3: Prevent discriminatory access to public terminal facilities
The SO aims to address the problem of restricted access to key infrastructure, defined in
section 2.5.3, by requiring Member States to grant operators access rights to public
terminal infrastructure on fair and non-discriminatory basis for the purpose of operating
regular services.
T
he majority of respondents to the OPC considered that operators should have a level playing field in
access to terminals (70%) and the majority of Ministries/Regulators that responded to the targeted
stakeholder questionnaire supported establishing common requirements to ensure that access to coach
29
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terminals is fair and non-discriminatory. Seven of those responding (35%) supported the proposal.
The SOs should be mutually reinforcing, such that interventions designed to ensure that
they are met can be expected to improve the competitiveness of the sector through a
series of interacting impacts. For example, removing restrictions on access to inter-urban
markets could be expected to reduce the administrative costs of entry by simplifying
procedures as well as removing direct restrictions on market access.
5.
W
HAT ARE THE VARIOUS OPTIONS TO ACHIEVE THE OBJECTIVES
?
The stakeholder consultation, the expert meetings, independent research and the
Commission's own analysis have allowed the Commission to identify different policy
measures, which served as a basis for the identification of a wide set of policy options.
These options have been considered in order to address the problem drivers and the three
specific objectives. Although the three problem drivers contribute to the overall problem,
one problem driver will be treated separately from the other two
47
.
The assessment leading to the choice of an overall policy option addressing the main
problems has be broken down into two assessments leading to the choice of two sets of
policy options:
the first set of policy options on market access addressing SO1 and SO2; and
the second set of policy options on terminal access addressing SO3.
Then a separate assessment and comparison of the two different sets of policy options is
performed and a preferred policy option from each set of options is selected. Finally, an
assessment of cumulative effects for the combined two preferred policy options is
performed.
The following process was applied for establishing the policy options:
identify an extensive list of policy measures addressing the problems (considered
policy measures);
as a result of this initial screening, a number of policy measures were discarded
from the initial analysis (see Annex 6 for the list of measures and the underlying
justification).
consider policy measures which are retained after a preliminary assessment; and
identification of possible policy packages.
5.1.
Retained policy measures
Driver 1
Excessive administrative costs of entry
No.
1
Policy measure
Standardise the
authorisation
procedure
Description
This measure aims to simplify and standardise the procedure for the
authorisation of regular services. There is a standardised authorisation procedure
for international regular services but the authorisation procedures for national
47
The policy option to address "Restricted access to key transport infrastructure" or SO3 is not interlinked
and the geographical scope of the effect is different to the choice of a policy option to address
“Excessive administrative costs of entry” or SO1 and "Restricted access to national inter-urban
markets" or SO2. Action in the former area need not imply action in the other and considering the two
areas separately was considered optimal.
30
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1815323_0035.png
No.
Policy measure
Description
regular services vary widely across Member States.
2
Abolish the
journey forms
for occasional
services
This measure aims to simplify the operation of occasional services by removing
the requirement to complete a journey form for occasional international services.
This measure will reduce regulatory costs by eliminating the administrative costs
for operators and national authorities.
Driver 2
Restricted access to national inter-urban markets
No.
3
Policy measure
Clarify the
meaning of
“Cabotage
operations shall
be
authorised…”.
Extend the
scope of the
Regulation to
include national
markets, subject
to authorisation
Description
This measure aims at clarifying how cabotage operations are authorised.
4
This measure aims to open access to national markets for regular services and
simplify the authorisation procedure. Member States would be able to reject an
application for an authorisation if the new service would compromise the
economic equilibrium of an existing public service contract.
During the targeted consultation 6 Member States reported that they did not
support this measure and the reasons given were concerns about unfavourable
impacts on coach sector employees (in Bulgaria and Estonia), the potential
adverse impact on services operated as PSOs (Germany and Ireland), safety
(Italy) and inconvenience (Spain). The difference in views of these stakeholders
does not appear to reflect the differences in the market liberalisation as
described in table 2.4 but rather reflect each Member States unique national
regulatory system.
5
Require access
to national
regular services
markets without
discrimination
Set common
requirements for
the protection of
PSCs
Set common
requirements for
the protection of
PSCs meeting
the needs of an
urban area
This measure aims to ensure that carriers from all Member States be guaranteed
access to national markets for regular services without discrimination on grounds
of nationality or place of establishment. The fact that a carrier is established in
another Member State shall no longer constitute justification for rejecting an
application for authorisation.
This measure aims to ensure that Member States are permitted to take action to
protect all public passenger transport services covered by PSCs from
competition. Member States may limit the right of access on services that are
covered by one or more public service contracts if the service would compromise
the economic equilibrium of a public service contract.
This measure aims to ensure that Member States are permitted to take action to
protect all public passenger transport services covered by PSCs meeting the
needs of an urban centre or conurbation, or transport needs between it and the
surrounding area. An automatic authorisation procedure shall apply to services
carrying passengers 100km or more. Member States may limit the right of access
on services that carry passengers less than 100km if the proposed service would
compromise the economic equilibrium of a public service contract.
Of the 20 Ministries or regulators that replied, five (Bulgaria, Finland, France,
Ireland and Portugal) supported a set of common requirements, as this would
help to create a more level playing field. All the Member States that supported
this measure have already opened national markets. Six (Estonia, Italy, Latvia,
Slovakia, Spain and the UK) maintain that the protection of PSOs is outside the
scope of Regulation 1073/2009 and should be addressed through Regulation
1370/2007. Although these six Member States share the same view on the
6
7
31
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1815323_0036.png
No.
Policy measure
Description
pro
tection of PSO’s the regulatory status in each of their national markets is
different.
This measure aims to abolish the need for an authorisation for regular services
carrying passengers over distances of 100km or more. Regular services would be
fully liberalised along the same lines as occasional services. This measure would
also address driver 1 as the time consuming authorisation procedure would no
longer be required and administrative and compliance costs would be reduced.
8
Abolish the
authorisation
procedure
Driver 3
Restricted access to key transport infrastructure
No.
9
Policy measure
Define a coach
terminal
Encourage coach
terminal operators
to provide access
Encourage the
publication of
conditions of use
Require the
European
Commission to
report on market
opening
Require Member
States to grant
non-
discriminatory
access
Require the
publication of
conditions of use
Description
This measure aims to provide the meaning of the term terminal. Terminals
are not yet defined in EU legislation and a definition would be a necessary
precursor to any action related to access to them.
This measure aims to encourage coach terminal operators to provide access to
carriers operating regular services on fair and non-discriminatory terms. This
should be done by guidelines/recommendations.
This measure aims to encourage the publication of conditions of use to
provide operators with transparency on how they will be treated by terminal
operators.
This measure aims to provide the European Commission with evidence of the
scale, incidence and duration of terminal access disputes. It may be
advantageous to expand the evidence base before further intervention to
specify proposals for the addition of capacity or the resolution of disputes.
This measure aims to require Member States to grant carriers access rights to
terminal infrastructure on fair and non-discriminatory terms for the purpose
of operating regular services.
10
11
12
13
14
This measure aims to require the publication of conditions of use to provide
operators with transparency on how they will be treated by terminal
operators.
5.2.
Identification of possible policy packages
The policy packages have been defined so as to reflect an increasing level of regulatory
intervention and entailing an increasing level of expected impacts. They are cumulative,
in the sense that all measures in PO1 are also part of PO2, which itself includes further
measures, and so on. This is intended to facilitate and structure the analysis of the
impacts, given the large number of measures which must be assessed. They have been
defined in a way to show the expected outcomes of increasing levels of regulatory
intervention.
5.3.
PO0 - Baseline
The Regulation would continue to apply in its present form. No new measures applied.
PO1
Open access to the market for regular services with the possibility to refuse
authorisation if the economic equilibrium of a PSC is compromised
Identification of a list of market access policy options
The retained market access policy options to address SO1 and SO2 are:
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Policy Measure Numbers: 1, 2, 3, 4, 5 and 6.
This option would provide common market access rules for inter-urban regular services. It would
simplify and standardise the authorisation procedure. The option would reduce costs by
standardising the authorisation procedure throughout the EU; make the procedure more
transparent; as well as reducing the number of grounds for refusal. Member States will be able to
protect all public service contracts by limiting the right of access if the proposed service would
compromise the economic equilibrium of an existing public service contract. As this option does
not aim at total liberalisation of the domestic market it will still be possible for Member States to
intervene in areas where regular services cannot be operated on a commercial basis.
It would abolish legal monopolies, national establishment requirements and eliminate any special
protection of other transport modes granted by Member States on inter-urban routes.
It would reduce the administrative burden by standardising and simplifying the authorisation
procedure for national regular services and abolishing the journey form for occasional services.
In practice this would provide a common procedure for authorising national and international
regular coach and bus services. Under this option Member States would have the option of
limiting the right of access to the market where the new service would compromise the economic
equilibrium of an existing public service contracts providing any public passenger transport
service. To determine if a PSC may be compromised an independent body should make the
decision to grant, refuse or limit the service on the basis of an objective economic analysis,
following a request from the competent authorities that awarded the public service contract or the
public service contract operator. The new independent body is proposed to ensure the
impartiality and objectivity of the economic analysis and should function in a way which avoids
any conflict of interests and any possible involvement in the award of the public service contract
under consideration. The procedure and criteria to be followed when determining whether the
economic equilibrium of the PSC is compromised by a new service should be in line with test
carried out by regulatory bodies in other transport modes, EU Law and the principles of equality
and non-discrimination. . If no request for a test is submitted within the deadline, the authorisation
would be granted. If there is a request for the test the entity making the request would be
required to provide the independent body with the information required to conduct the test. The
independent body would assess whether the economic equilibrium of a public service contract
would be compromised by the proposed new service. Member States will not be obliged to
introduce a new independent body but will be free to use an already established body. The body
will only incur costs if it is requested to conduct a test but as the required information is provided
by other entities the cost of the test for the independent body will be minimal. The independent
bodies would be required to develop a consistent methodology that would be clear, transparent
and non-discriminatory. The analysis would focus on the economic impact of the proposed new
service on the public service contract as a whole, not on individual services operated under it,
over its entire duration. The economic equilibrium of a public service contract would generally be
considered as compromised if the proposed new service has a substantial negative impact on the
profitability of services operated under the public service contract, and/or the net cost for the
competent authority awarding the public service contract. The independent body may grant the
authorisation, refuse the authorisation or indicate possible changes to the proposed service that
would ensure that the conditions for granting the authorisation are met, and give the opportunity
to the applicant to adjust its application for authorisation accordingly.
This method of regulating the interaction between commercial services and PSCs is similar to the
method employed currently in Regulation 1073/2009 for international regular services. It is not
possible to determine how new services would affect PSC’s in all the non-liberalised
Member
States but under this option the relationship between inter-urban (commercial) services and
urban (usually operated under PSC and subsidised) services is clearly defined and the
commercial service will only be permitted if it will not compromise the economic equilibrium of a
PSC. There is no evidence to indicate that this method of regulating the relationship with PSCs
has been problematic. However, there is the risk that operators are not provided with sufficient
flexibility to address demand and provide services where they are needed.
The extension of the scope of the legislation to include national regular services under this option
33
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is not supported by 6 Member States for
PO2
Open access to the inter-urban market for regular services over distances of 100km
or more. Authorisation can be refused if the economic equilibrium of an urban PSC is
compromised
Policy Measure Numbers: 1, 2, 3, 4, 5 and 7.
This option differs from PO1 in the approach taken to protect public service contracts and the
extent of the REFIT intervention. It would simplify and standardise the authorisation procedure for
national and international regular services and change the grounds for refusal. Similar to PO1,
this option does not aim at total liberalisation of the domestic market. In this case Member States
will be able to intervene in areas where commercial services may compromise the economic
equilibrium of certain PSC’s. The opening of a new coach line could no longer be refused if the
service carries passengers more than 100km. The 100km threshold enables Member States to
take action to protect urban transport services covered by PSCs from competition. The extent of
the REFIT intervention is increased as the authorisation regime becomes faster, more
transparent and effectively lowers the barrier for new market entrants. It provides operators with
more certainty when assessing whether a new coach line is acceptable or not. It reduces the
administrative burden on operators through simplification and standardisation of the authorisation
procedure. There is no longer a requirement to get agreement from authorities in all Member
States in whose territories passengers are picked up and set down.
In practice this would provide a common procedure for authorising national and international
regular coach and bus services. New entrants would apply for authorisation to commence a new
service. If the new service is carrying passengers over distances of 100km or more the
authorisation is automatically granted. If the new service is carrying passengers over a distance
of less than 100km competent authorities or the operators of a PSC would have a defined time to
request an economic equilibrium test which would be conducted by an independent body in the
same way as PO1.
This method of regulating the interaction between commercial services and PSCs is employed in
a number of Member States including Germany, France, Italy and in the past in the UK and
Sweden. It is not possible to determine the future relationship between commercial and PSC
services in all non-liberalised Member States. However, the distance threshold will clearly define
the relationship between inter-urban (commercial) services and urban (usually operated under
PSC and subsidised) services. There has been no evidence to indicate a problematic relationship
between commercial services and PSC services in any of the Member States that have opened
market access using a similar framework but there is some anecdotal evidence from Germany
that rail has lost many customers to coach with twice as many coach passengers (30%) coming
from long-distance trains as from local or regional trains (14%) but the German Ministry suggests
that the loss of rail passengers is likely to be effected by other factors such as rail strikes, floods
on lines and decreasing supply.
The model to compensate public service operators for the operating a public passenger transport
service under PSC that involves compensation from public authorities in the form of granting
exclusive rights to provide services on a profitable route, in such a way that profits for the
provision of the service cross-subsidise other non-profitable services imposed on the service
provider appears to be more challenged under this option. This model is used both in railways
(for instance in the United Kingdom) and in coaches (for instance in Spain). Such a model relies
on the existence of a monopoly in the profitable service, and weak competition from other
transport modes, as otherwise it would not be possible to extract the necessary rent from the
profitable services to cross-subsidise the other services
48
. The new services would introduce
competition in the long distance market and a threat to this model of PSO funding. It is likely that
new services would “cherry-pick” the profitable lines and as the PSO operator loses revenue from
the profitable services this model of public intervention becomes challenged and new financing
48
See: http://www.europarl.europa.eu/RegData/etudes/STUD/2017/601970/IPOL_STU(2017)60197
0_EN.pdf
34
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models may be required.
PO3
Open access to the inter-urban market for regular services without an authorisation
process for regular services carrying passengers over distances of 100km or more
Policy Measure Numbers: 2, 3, 4, 5, 7 and 8.
This option differs from PO1 & PO2 in that all regular services that carry passengers over
distances of 100km or more would be fully liberalised and there would be no authorisation
procedure for these services. The existing time-consuming national and international
authorisation procedures would no longer be necessary and the principle of free competition
would apply. This removes the complexity, delay and cost associated with an authorisation
regime resulting in a reduction of administrative and compliance costs. As the authorisation
procedure is abolished enforcement would have to focus on rules on access to the profession or
on road safety. In the absence of an authorisation procedure the Member State of establishment
would have a vital supervisory role in this new regime and the investigations during the
application procedure for a Community licence (or the certified true copies) would replace the
investigations carried out in the current authorisation procedures. As such, host Member States
would rely on Member States of establishment to carry out controls and would be deprived of
direct enforcement possibilities. As a result of the inclusion of the measure to abolish the
authorisation procedure for this option would have substantial benefits in terms of reduction of
administrative burden.
In practice new entrants would not have to apply for authorisation to commence a new service
carrying passengers over distances of 100km or more but they would have to notify the
competent authority before commencing, ceasing or altering operation on a route. Similar to PO1
and PO2, this option does not aim at total liberalisation of the domestic market. In this case
Member States will also be able to intervene in areas where commercial services may
compromise the economic equilibrium of certain PSC’s. If the new service is over a distance of
less than 100km authorisation would be required and competent authorities or the operators of a
PSC would have a defined time to request an economic equilibrium test which would be
conducted by an independent body in the same way as PO1.
The method of regulating the relationship with PSC’s under this option is the same as under PO2.
The three ways in which the needs for authorisations are proposed to be reduced further
along with the protection of PSC are set out in the following figure.
Figure 5-1: Approaches to reducing the requirement for authorisations and the protection of PSC's
100km or
more
PO1
Authorisation applies
Authorisation can be
rejected if it
compromises a PSC
Authorisation applies
Authorisation can be
rejected if it
compromises a PSC
PO2
Authorisation applies
PO3
Authorisation cannot
be required
No protection of PSC
No protection of PSC
Less than
100km
Authorisation applies
Authorisation can be
rejected if it
compromises a PSC
Authorisation applies
Authorisation can be
rejected if it
compromises a PSC
5.4.
Identification of a list of terminal access policy options
The retained terminal access policy options to address SO3 are:
PO4
Soft Regulation and report
Policy Measure Numbers: 9, 10, 11 and 12.
This would establish guidelines or recommendations on access to terminals. The guidelines or
recommendations would include a definition of a coach terminal as it is not yet defined in EU
legislation. The definition would address barriers to entry in the form of access to terminals.
35
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They would encourage operators and managers of terminal infrastructure to provide access to
carriers operating regular services on fair and reasonable grounds and without discriminatory
between operators. In practice it is expected that the operator or manager of a terminal would
grant access to and use of a coach terminal to all carriers on the same terms. It would be
considered fair and reasonable for an operator or manager of a terminal to refuse access to a
terminal if there is no available capacity.
They would encourage the operators and managers of terminals to make available the conditions
of use of the terminal which shall include at least:
list of the services provided with prices
rules for scheduling the allocation of capacity
current capacity allocation, and
current timetable.
The conditions of use would be published in two official languages of the EU and made available
free of charge from the operator or manager of the terminal and the competent authority. The
conditions of use would also be displayed in the terminal, where they have websites, on the
websites of the operator or manager of the terminal and the competent authority.
The guidelines or recommendations would also encourage that decisions on applications for
access are taken within a specified time after the date of application.
The European Commission would report on the effects of market opening after a period of time
during which it is expected that overall demand for access to terminal infrastructure would either
have reached a plateau or peaked and begun to decline.
PO5
Equal access rules
Policy Measure Numbers: 9, 12, 13 and 14.
This would define a terminal in legislation. It would require that operators and managers of
terminal infrastructure to grant access to carriers operating regular services on fair and
reasonable grounds and without discriminatory between carriers. In practice operators or
managers of a terminal would be required to grant access to and use of a coach terminal to all
carriers on the same terms. It would be considered fair and reasonable for an operator or
manager of a terminal to refuse access to a terminal if there is no available capacity.
Operators and managers of terminals would be required to make available the conditions of use
of the terminal which shall include at least:
list of the services provided with prices
rules for scheduling the allocation of capacity
current capacity allocation, and
current timetable.
The conditions of use would be required to be published in two official languages of the EU in line
with existing international practices
49
and made available free of charge from the operator or
manager of the terminal and the competent authority. The conditions of use would also be
displayed in the terminal, where they have websites, on the websites of the operator or manager
of the terminal and the competent authority.
Decisions on applications for access would be required to be taken within a specified time after
the date of application. Member States would be required to ensure that carriers have the
capability to appeal negative decisions.
The European Commission would be required to report on the effects of market opening after a
period of time during which it is expected that overall demand for access to terminal infrastructure
would either have reached a plateau or peaked and begun to decline. It would ensure
undertakings can appeal negative decisions by requiring Member States to ensure that they have
49
For example see Directive 2012/34/EU of the European Parliament and of the Council of 21 November
2012 establishing a single European railway area Text with EEA relevance, recital 34.
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the possibility to appeal decisions refusing access to at least on independent and impartial body.
6.
W
HAT ARE THE IMPACTS OF THE DIFFERENT POLICY OPTIONS AND WHO WILL BE
AFFECTED
?
The analysis of impacts covers all policy options. The key impacts are captured
quantitatively at a level of detail consistent with the available data, otherwise they are
treated qualitatively. Based on a set of assumptions, an IA tool was developed by the
external consultant to assess the development of the baseline and the effects of various
policy measures within a 20 year timespan (from 2015 to 2035) to align with related
impact assessments in the mobility package. The development of the baseline scenario is
based primarily on input assumptions from an update of the EU Reference Scenario
2016
50
but additionally covers the implementation of the reform of the national
regulatory frameworks for buses and coaches in Germany, France, Italy and Poland. The
key output variables which result from the overarching modelling framework include: 1)
changes to the level of transport activity; 2) fares for users; 3) connectivity of different
social groups; 4) environmental costs and 5) regulatory costs for different groups. Some
of the other important impacts (e.g. working conditions) are estimated based on the desk
and field research. All costs and benefits are summarised over the 20-year period 2015-
2035 and presented as a 2017 Net Present Values using a discount rate of 4%. Impacts on
transport activity and employment are presented for 2030, relative to the Baseline. The
sensitivity and robustness of the results were tested; the relative impacts of each policy
option were not significantly affected by the low and high cases used in the sensitivity
analysis, as described in Annex 4. Each policy option presented below is compared
against the results of the baseline scenario, unless stated otherwise.
Each policy option has been analysed in terms of its economic, environmental and social
impacts. Where possible, quantitative estimates are given, in other cases however,
because of the non-availability of statistics, this was not possible. In these cases, a
qualitative assessment is provided and where relevant strengthened by the opinion of
stakeholders.
The impacts are likely to vary between Member States depending on the existing market
access rules and the economics of individual routes. However, as noted in table 2-4, 14
Member States have already liberalised including 6 of the largest 7 national markets. In
this IA the quantification of the problem of obstacles in national markets that hinder the
development of inter-urban bus services focuses on the 14 Member States that have not
liberalised their inter-urban regular coach and bus services. The estimated impact of
market opening in these Member States is based on evidence from previous domestic
coach market opening initiatives. The levels of secondary impacts are driven by changes
to the level of transport activity. It is assumed that the non-liberalised Member States will
50
The updated EU Reference scenario 2016 includes some updates in the technology costs assumptions
(i.e. for light duty vehicles) and few policy measures adopted after its cut-off date (end of 2014) like
the Directive on Weights and Dimensions, the 4th Railways Package, the NAIADES II Package, the
Ports Package, the replacement of the New European Driving Cycle (NEDC) test cycle by the new
Worldwide harmonized Light-vehicles Test Procedure (WLTP). It has been developed with the
PRIMES-TREMOVE model (i.e. the same model used for the EU Reference scenario 2016) by ICCS-
E3MLab. A detailed description of this scenario is available in the Impact Assessment accompanying
the Proposal for a Directive amending Directive 1999/62/EC on the charging of heavy goods vehicles
for the use of certain infrastructures, SWD (2017) 180
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experience a rate of transport activity growth between that of Germany and the UK in the
first five years following market opening. The assumption is adjusted depending on the
ability of each Member State to restrict market access under each option.
A schematic diagram of the segments of coach and bus markets is shown in figure 6-1
below.
Figure 6-1: Segments of the market for regular coach and bus services
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
The red dotted line divides the services that require subsidy (below the line) or services
that can be operated commercially (above the line).
The horizontal axis of the figure indicates the distance over which a passenger is carried,
ranging from short services on the left to long services on the right, and then international
services which are the focus of Regulation 1073/2009. The vertical axis of the figure
indicates the number of services.
The ellipses on the figure illustrate a number of market segments. First, and bottom left,
are
short-distance regular services,
a large proportion of which, particularly on urban
and suburban routes, are not commercially viable and hence require a public service
contract as provided for under Regulation 1370/2007.
Second, and top left, are
short-distance regular services in Member States in which all
services are liberalised,
and fares are either unregulated or set at levels which can be
commercially viable.
Third, and bottom right, are
longer-distance regular services in Member States where a
mix of profitable and unprofitable services are operated as a package
, as in the regional
concessions in Spain and under the contracts awarded to KTEL companies in Greece.
Fourth, and top right, are
longer-distance services in Member States which have
liberalised regular domestic services,
such as Germany (2013), Italy (2014) and France
(2015) where, subject to the restrictions described above, new entrants have typically
first entered the market on the most profitable routes. However, as indicated with the
ellipse with the question mark (“?”), these services will in principle continue to expand
38
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until all profitable opportunities have been exploited, in theory including all services
above the dotted red line.
This shows that opening access to commercial services and protecting public service
contracts are not mutually exclusive.
Opening access with the adequate protection of
PSCs provides opportunities for carriers to respond to demand and provide new services.
However, it also introduces the risk of carriers cherry-picking the most profitable
services. It is therefore necessary for the authorisation procedure and the economic
equilibrium test to strike a balance between the benefits of opening market access with
the potential impact on the economic equilibrium of PSC’s. The retained policy options
provide different combinations of protection for PSCs and market opening to assess the
impact of each combination. The experience from liberalised and transition Member
States (see table 2-4)
has shown that PSC’s can be protected and co-exist
with a thriving
open inter-urban domestic transport market. The approach taken to opening market
access in each of the liberalised Member States was different but in all cases it has been
perceived to have been a success.
6.1.
Impacts of policy options to address excessive administration costs of
entry and market access problems
6.1.1.
Economic impacts
Transport Activity: The impact of the policy options on transport activity is focused on
the 14 non-liberalised Member States (including those awarding concessions through
competitive tendering). Impacts on other Member States, which are already liberalised,
are expected to be positive due to an increasing alignment of national market access
rules, which will reduce the administrative burden on operators seeking to provide
regular services in more than one domestic market. Furthermore the alignment of rules is
expected to encourage some coach operators to provide international services.
Figure 6-2 shows the increase in inter-urban coach traffic under the market opening
options by Member State in 2030 relative to the Baseline. While all options lead to
substantial increases of coach traffic in Member States, Option 2 and Option 3 deliver the
same increase (displayed as one column in figure 6-2) which is considerably larger than
the increase under Option 1. Under Option 1 the economic test can be used to assess if
the new service would compromise the economic equilibrium of the PSC. The test would
examine the balance of the effects of a proposed new service between generation of new
revenue (by creating new demand) and abstraction of revenue from existing rail or coach
services operated under a PSC. The test allows the positive effect of authorising a new
service (e.g. lower fares with more services, better connectivity and rail operators can
enter into coach market or benefit from integrating with coach and picking up its
passengers) to be considered and balanced against the negative effect of abstraction.
This inclusion of the measure setting common requirements for the protection of PSCs
meeting the needs of an urban area, which will simplify the authorisation procedure and
remove discretion to restrict market access unduly. The effect varies considerably
between Member States and the increases in Belgium, Hungary and Greece are
particularly large when compared to Spain, which has a well-developed coach market.
Figure 6-2: Impact of options by MS (increase in inter-urban coach traffic in 2030 relative to the
Baseline, in billion passenger-kilometres)
39
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25.0
20.0
Billion pkm
15.0
10.0
5.0
0.0
HU
BE
EL
AT
HR
ES
PO1
LT
SI
NL
EE
LV
CY
MT
LU
PO2 & PO3
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
The average growth rate by Member State by 2030 are shown in figure 6.3 below. The
growth rates in Spain & the Netherlands, which have well-developed coach markets, are
low even after the adjustment for the effect of liberalisation, and the additional traffic
generated is therefore correspondingly low despite the volume of traffic in the baseline.
By contrast, Hungary experiences a higher rate of growth in the baseline than Spain,
reflecting the economic conditions taken into account in the baseline and the adjusted
growth rate and increment in traffic is correspondingly large.
Figure 6-3: Average annual growth rate by 2030 by MS under each option
7%
Average annual growth rates (2015-2030)
6%
5%
4%
3%
2%
1%
0%
HU
HR
AT
BE
SI
EL
MT
LT
EE
LU
CY
LV
NL
ES
-1%
-2%
Baseline
PO1
PO2 & PO3
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
Under options 2 and 3 new services carrying passengers over distances of 100km or more
cannot be prevented solely to protect an existing PSC. This introduces the risk that the
new service may erode some form of PSCs such as a service to a remote area via inter-
urban bus services or alternatively it may result in the requirement for an increase in
subsidies. However, no evidence is available to indicate that the opening of the national
40
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market for regular coach and bus services has had either of these effects. In cases where
profitable and non-profitable services are bundled together, passengers on the profitable
routes are “subsidising” through increased fares the passengers on non-profitable
routes.
This inflates the fares on profitable routes, makes these services less attractive for
citizens and promotes private use of cars. As described in table 2-4, 14 Member States
have already opened their markets accounting for 73% of the total passenger kilometres
for the EU.
The impact of market opening in these Member States has been widely
studied and we have not found any evidence that the market opening has eroded
PSCs serving rural areas or that the negative impact of abstraction has been larger
than the positive impact of generation.
There are very few PSCs in place that cover
services beyond 100km so the overall impact on PSCs of opening the market in this
segment is likely to be very small.
The national policies and frameworks towards the
provision of regular services varies across the non-liberalised Member States
however this was also the case for the 14 Member States that have already
liberalised. Furthermore, stakeholders have been widely consulted and no
stakeholder has indicated that market opening has resulted in these issues.
The evidence in the Impact Assessment support study suggests that Member States are
more concerned with their urban PSCs and have chosen regulatory distances broadly
consistent with permitting no journey wholly within their largest suburban system, and
by implication any other suburban system. The current precedents include 100 km in
France and 50km in Germany, and past precedents include 100 km in Sweden and 48km
in the UK.
Table 6-1 below provides further information of incremental traffic under each policy
option in 2030 relative to the Baseline. The Baseline projection of coach traffic is 589
billion pkm in 2030. The change relative to the Baseline under Option 2 and Option 3 is
around 66.5 billion pkm in 2030, representing an increase of 11.3% in coach traffic. The
change relative to the baseline for journeys is roughly 430 million and the number of
services increases by about 510 in 2030.
Table 6-1: Estimated impact of options on coach traffic levels
Metric
National
Billion passenger-km
International
Total
% increase
Million journeys
Number of Services
Average load factor (p.p. change)
Change relative to the baseline in 2030
PO1
25.0
3.4
28.4
4.8%
190
220
-0.7
PO2
58.3
8.2
66.5
11.3%
430
510
-1.1
PO3
58.3
8.2
66.5
11.3%
430
510
-1.1
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
When estimating the impacts it was not possible to differentiate between national and
international regular services from the available data. The estimated volume of
international traffic rises in line with the total traffic which is broadly consistent with the
recent experiences when domestic liberalisation has been seen to stimulate the
introduction of new international services as well as the development of national
networks. It is also assumed that vehicle kilometres operated increase in line with
demand and the average load factor will not change materially between options.
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Just fewer 60% of the respondents to the OPC consider that establishing a common framework in the EU
for access to national markets for regular services would have a positive impact on growth in the
passenger transport sector. However, the national authorities had mixed views with 2 of the 3 considering
it would have a negative effect. The same percentage of respondents consider that it will have a positive
impact on the administrative burden for public administrations with just more than 60% considering it
would also have a positive impact on the reduction of cost of compliance with legislation.
Revenue: The projected impacts on coach revenue reflect the underlying traffic activity
impacts described above. Option 1 generates in the region of €27 billion in additional
coach sector revenue in net present value (NPV) terms over the timescale of the impact
assessment (2015-2035). Again, Options 2 and 3 perform particularly well, generating
roughly €62 billion in additional coach sector revenue reflecting the inclusion of the
measure setting common requirements for the protection of PSCs meeting the needs of an
urban area, which would simplify the authorisation procedure and remove discretion to
restrict market access unduly.
Just fewer than 60% of respondents to the OPC consider that abolishing restrictions on access to national
markets for regular services would have a positive impact on the economic situation of small road
passenger transport operators. The results are mixed across stakeholder groups with national authorities
and NGOs consider that the impact would be negative. More than 60% of the respondents (and the
majority of all stakeholder groups) consider that it will have a negative effect on incumbent coach
operators.
Fares for users and service quality: Given the lack of data from liberalised Member
States on the effects of coach market liberalisation the impact on fares for users and
service quality has been assessed in qualitative terms. Fares for users and service quality
have been assessed together rather than in isolation to demonstrate the overall impact on
customer service.
The evidence indicates that most coach services are cheaper, on a fare per kilometre
basis, than the equivalent rail service. This may be because rail often offers faster
journeys and can therefore act as a market ‘price-maker’. However, this is not always the
case and coach fares have been found between two and three times greater than the
equivalent rail fare, despite average speeds being similar between modes. In this case it is
likely that there are additional factors such as service frequency and quality which permit
coach operators to charge a much higher fare. Where one mode offers more frequent and
faster services, the other may have the characteristics of an “inferior good
51
” and have to
accept lower fares. At long distances, where air services are available, coach services can
attract passengers by not charging for heavy baggage, and may be viable when rail
services are not.
In cases where rail services are slower and less frequent than coach services, rail may be
an “inferior good” and coach may charge a fare many times the rail fare.
This is
particularly the case on the routes in the EU13 and is not dependent on the state of
market opening.
The Eu o a o ete Repo t p o ides a i di atio of passe ge s’ pe eptio of fa es as ell as diffe e t
aspects of service quality. The results do not suggest any systematic differences in the satisfaction of
passengers in liberalised and non-liberalised Member States. Nevertheless, there is evidence from
individual Member States that have liberalised indicating that market opening can lead to a substantial
51
The term “inferior good” here as defined
strictly within economic terminology. In economics, an inferior
good is one for which demand falls when consumer income rises, and vice versa.
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reduction in fares as well as improvements in service quality, at least in the short term.
Over the longer term the evidence suggests that after market opening, strong
consolidation takes place. The competent authorities have the role of ensuring that there
is no decline in competition in the supply of bus services after the removal of market
restrictions due to the abuse of a dominant position by one player.
The following figure shows changes in National Express average real fares and service
departures from Victoria Coach Station in London (the latter is an indication of two
different dimensions of service quality, namely the range of routes served and the service
frequency offered). It indicates that in the five years following full market liberalisation
in 1980, average fares fell by more than 20%, while the number of departures increased
by more than 100%, representing a substantial improvement in the service offer. Note,
however, that by 1991 average fares were more than 10% higher than in 1980 while
departures had fallen back to 120% of their pre-liberalisation level, reflecting the
consolidation of the market and the strengthening of National Express’s dominant
position from 1984.
Figure 6-4: Trends following domestic liberalisation in the UK
Source: Peter White, reported by ECMT, Steer Davies Gleave analysis in Annex F of support
study
Whether the resulting price-service quality offer represented an improvement on the
position in 1980 is difficult to determine on this evidence alone, although the increase in
departures was clearly a benefit to passengers. In any event, the figure demonstrates the
difficulties of sustaining any initial, substantial improvement in the value of the service
offer, particularly if competition in the market is not preserved.
More recent evidence from Germany supports the view that that the immediate effect of
liberalisation is to improve the price-service quality ratio and that competition is
recognised an important determinant of fare levels
52
. A previously cited study by Dürr
and Hüschelrath (2015) reported that there are significant reductions in fares on routes
where there is competition between two or more operators. It also suggests, as illustrated
in the figure 6-4 below, that liberalisation resulted in a wide range of price-service
quality combinations within the first year of the new market access arrangements taking
effect.
52
Contestability of long distance German coach market, Katrin Augustin, KCW GmbH, European
Transport Council 2013.
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Figure 6-5: price-service quality offer of German coach operators in 2014
Source: Dürr and Hüschelrath (2015)
This can be interpreted as a measure of customer perceptions of the overall value for
money offered by the different operators. As shown, operators offering higher value for
money include both FlixBus (with lower fare and lower service quality rating) and
DeinBus.de (with a higher fare and higher service quality rating). Those apparently
offering lower value for money, based on customer perceptions, include operators such
as Berlin Linen Bus and Eurolines Germany, both of which charged relatively high fares
but whose service quality offering was broadly comparable with that of FlixBus. Note
that both these operators were established before liberalisation, and could therefore be
considered to represent the price-service quality offering in the absence of competition.
As part of the 2016 study on passenger transport by coach in Europe a number of fares
for interurban services were sampled across 19 Member States as illustrated in the figure
below. The fares include both peak and off-peak return fares and recorded data for
booking one day, one week and one month ahead for a single point-to-point journey.
From the available data, it appears that the fare per kilometre averages at
€0.06 in
liberalised markets, compared to €0.11 in restricted markets. This significant difference
indicates that liberalisation usually leads to a reduction in prices with positive impacts for
the passengers.
Figure 6-6: Sample of fares for national inter-urban services
Cheapest single, return or advance
PPP_adjusted fare per kilometre
0,16
0,14
0,12
0,10
0,08
0,06
0,04
0,02
0,00
AT EL HU HR ES LT LV BG PT SE RO CZ FR DE IE UK IT
Restricted Market
Liberalised
PL
FI
Most expensive single, return or advance
Source: Adapted from Support Study for the IA for the Revision of Regulation 1073/2009
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Over the long term it is more difficult to predict because the fares depend on the extent to
which competition on the individual route is sustained. If competition is not preserved,
the efficiency gains resulting from the removal of market restrictions can be outweighed
by the negative consequences through the abuse of a dominant position by one player,
leading to higher fares. However, any abuse of market power is susceptible to
intervention by supervisory authorities; also the specific dynamics of this market will
counter this: as fixed investment required for market entry is typically very low (no
infrastructure investment, availability of leased bus capacity), any excessive price rises
by mono- or oligopolists will immediately provoke new entry. These markets will
therefore clearly remain contestable after the elimination of national regulatory barriers.
Based on this analysis, it can be expected that under Option 1, market opening will
initially lead to a reduction in fares and more innovative pricing strategies in the short
term. The studies mentioned above have identified significant reductions in fares on
routes where there is competition between two or more operators.
However, the impact on fares over the long term is more difficult to predict, because it
depends on the extent to which competition on individual routes is sustained. There is
clear evidence that the market in Germany has become concentrated and emerging
evidence that consolidation among operators is taking place in France and Italy. The UK
market continues to be dominated by National Express despite more than 35 years of
liberalisation.
Against this background, it seems that the impact on fares over the long term will to a
great extent depend on the willingness of competent authorities to take action to preserve
competition.
We have not identified any evidence from the Eurobarometer survey suggesting that
passengers using services in liberalised markets perceive service quality to be materially
higher than in other markets. However, some studies suggest that market liberalisation
leads to a more innovative use of sales channels, the adoption of yield management and
faster introduction of on-board services such as Wi-Fi. In addition, there is clear evidence
from independent studies that the number of services offered increases substantially in
liberalised markets.
Option 2 and Option 3 will have the same impact on fares as Option 1 but as they will
stimulate more rapid market growth more aggressive price competition in the short term
under both these options is expected.
Just fewer than 60% of the respondents to the OPC consider that market opening will have a positive
effect on fares. The stakeholder groups that were the most divided in their assessment of the effect were
governmental authorities (2 of 3 view the effect as negative) and NGOs (14 of 28 view it as negative).
Options 1, 2 and 3 all include measures that will simplify the market access procedures
and open the inter-urban market to competition. As described in the impacts on transport
activity section above, each option has a positive impact on the number of services as a
result of newcomers entering the markets with extensive networks including coach lines
in areas where coach services were previously barely present. There is also evidence (see
table 2-5 above), from recently liberalised markets, that service frequency increases with
the number of competitors on the route and that liberalisation has provided passengers
with a greater choice of combinations of price and service quality.
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Each of the three options has a positive impact on safety which is driven by the
significant reduction in car traffic. External costs of accidents fall under Option 1 by
about €1.2 billion, expressed as present value over 2015-2035.
They fall more
substantially under option 2 and 3 generating in the order of €2.8 billion in savings over
the same period. This is discussed in more detail in the section 6.1.3. on social impacts.
Market opening has led to the use of more innovative use of sales channels and
platforms, the adoption of yield management and faster introduction of on-board services
such as Wi-Fi. This is particularly important to younger passengers who are the most
interested in coach services. There is no evidence of any difference across the 3 options.
The majority (just under 60%) of respondents to the public consultation reported that in their view
opening the market for national regular services would have a positive effect on service quality provided
to passengers. The views of the stakeholder groups were mixed with the majority of governmental
autho ities of a d NGO’s 6 of 8
considering that the effect on service quality will be negative. The
Eurobarometer Report results indicate that passengers using coach services in liberalised markets do not
perceive the quality of service to be materially higher than in other markets.
Level of performance of other modes of transport: Increases in the level of coach
transport activity are likely to lead to decreases in the level of transport activity on
competing transport modes. Competition from long distance coaches encourages rail
transport to lower its prices and set up low cost services to retain its customers. Also, rail
operators have the capability to enter the coach market to regain some of the passengers
lost to rail such as in France where Ouibus (a 95% subsidiary of SNCF) holds 30% of the
intercity coach market. To calculate the decrease in traffic for each competing transport
mode, the traffic diversion factors derived from experience in Germany have been
applied. These factors are: 4% for air transport, 40% for passenger car transport, 46% for
rail transport and 10% for generated coach transport. The formula used to calculate the
change in share is described in Annex 4, in the section “Assessment of secondary
impacts”.
One factor that provides coach an advantage compared to rail is that operators make no
payment for the use of infrastructure beyond an annual licence, while rail operators
maybe required to pay not only the cost that is directly incurred as a result of operating
the train service but also mark-ups on the basis of efficient, transparent and non-
discriminatory principles which are permitted to obtain full recovery of the costs incurred
by the infrastructure manager. Thus, while the directly variable costs of coach may be
lower than those of rail, the effect of mark-ups, the effect of mark-ups may be the
average costs of rail are higher than those of coach. In practice many of the costs of both
rail and coach operations, including the provision of vehicle and crew, are time-based, so
an important factor may often be the relative average speeds achievable by rail and
coach, determined both by the rail and road infrastructure and the number of stops made
on route. This initiative on access to the coach market should be seen as part of a co-
ordinated response to, amongst other things, market challenges faced. As part of this
package buses and coaches will be included within the scope of the Eurovignette
Directive. The inclusion of buses and coaches will help to diminish distortions of
competition in the internal market for passenger transport caused by according
preferential treatment (i.e. exemption from paying for the use of infrastructure) to these
vehicles, vis-à-vis rail transport, which is already subject to such charging.
A second factor providing coach with an advantage compared to rail is that the unit of
capacity, a coach, is much smaller than a typical train. In practice, an interurban-service
46
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with a number of intermediate stops may generate only sufficient demand to justify a
train every hour or every two hours. The demand between the two cities alone, however,
may be sufficient to support a half hourly coach service operating non-stop between them
on a direct motorway, in some cases with a comparable or shorter overall journey time.
The impact of each policy option on traffic carried by mode in 2030 relative to the
Baseline is shown in figure 6-3 below. Under Option 1 there is a limited impact on rail of
about 2% (about 13 billion pkm) and a 4.8% (about 28 billion pkm) increase in coach
total pkm. Under Options 2 and 3 there is a larger but still limited impact on rail of 4.8%
(about 30 billion pkm) with a significant increase in coach transport activity of 11.3%
(about 66 billion pkm). The modal share of rail in under Options 2 and 3 is decreasing by
0.4 percentage points in 2030 relative to the Baseline (from 8.4% to 8%)
Figure 6-7: Estimated impact of market opening options on other modes (% change to the Baseline
in 2030)
11%
9%
% change to the Baseline in 2030
7%
5%
3%
1%
-1%
-3%
-5%
PO1
PO2 & PO3
Coach
Rail
Car
Air
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
Our analysis, based on the experience of Member States that have liberalised their coach
markets, indicates that the
liberalisation of national markets can only be expected to
have a limited impact in terms of passenger shift from rail.
This could be explained
somewhat by the targeting of coach operators of services at different groups of
passengers. In the targeted consultation, coach operators confirm that they target specific
groups such as those without access to a car, younger and older passengers and
passengers who could be considered more finically disadvantaged.
The decrease in passenger car transport activity for the 3 options appears small at under
0.5% (27 billion passenger-kilometres) relative to the Baseline in 2030 but given the
dominance of car travel in the EU passenger transport, even the small percentage
reduction in car traffic achieved under each option has important implications for traffic
congestion and emissions as discussed below.
As a result of the changes in the allocation of traffic across modes under Options 1, 2 and
3, the modal share of coach services increases. Under Option 1 the sector’s modal share
increases by 0.4 percentage points in 2030 relative to the Baseline. Under Options 2 and
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3, which generate
more substantial additional coach traffic, the sector’s modal share
increases by 0.9 percentage points. Against the background of the long term decline in
modal share described in Section 2.2 this would represent an improvement in the
competitiveness of the sector and facilitate inter-urban mobility for all citizens and in
particular for groups with limited access to other modes.
The increase in coach traffic generated by each of the options results in a diversion away
from other modes. The beneficial effects of the modal shift from car and air together with
the generation of new traffic are greater than the abstraction from rail.
The performance
of coach and rail combined is improved by all three options so increase the modal
share of sustainable transport modes.
The modal shift also reduces the revenues earned by other forms of public transport,
particularly rail transport. However, similar to the net beneficial effect of the modal shift
under each option there is a net increase in revenues due to the expansion of the market
towards new passengers as described in figure 6-8 below.
Figure 6-8: Revenue of coach and other modes relative to the Baseline over 2015-2035 (expressed as
present value)
PO1
80.0
PO2
PO3
illio €
‘e e ues prese t alue i
60.0
40.0
20.0
0.0
-20.0
-40.0
-60.0
5.0
10.7
10.7
Coach
Rail
Air
Net
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
To assess the impact of the policy options on the performance of other transport modes,
the lost revenue arising from the decrease in the level of transport activity was estimated
based on the demand reduction rates provided in in the first paragraph of this section.
Under Option 1 rail revenues decrease by about 0.6% (€20 billion) relative to the
Baseline and there is a net increase in revenues of around €5 billion (expressed as present
value). Under
Options 2 & 3 the estimated reduction in revenues is about 1.4% (€46
billion) and there is a net increase in revenues of around €10.7 billion relative to the
Baseline (expressed as present value). However, the estimates of revenue loss are based
on diversion factors derived from experience in Germany, which in some respects has
introduced a greater degree of liberalisation than is implied in the policy options which
provided more protection to existing services than is the case in Germany so the
estimates of rail revenue loss shown in the figure below may overstate the impact.
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Administrative Burden: The reductions in administrative burdens are estimated using the
costs associated with authorisations and journey forms as previously described in table 2-
6
53
.
The saving from the measure abolishing the journey form for occasional services is
estimated at €4 million over the period 2015-2035
(expressed as present value) relative to
the Baseline under all three options and is the only reduction in administrative burden
under option 1.
Under Option 2 the same savings are generated from abolishing the journey form. It is
assumed that revenue is foregone due to delays in the authorisation procedures and
therefore savings are generated by the reduction in time to complete authorisation
process from four months to two months. This saving is estimated at €1,450 million over
the period 2015-2035 (expressed as present value) relative to the Baseline.
Under Option 3 the same reductions from getting rid of the journey form are generated as
Option 2 with a reduction of around €240 million over the period 2015-2035
relative to
the Baseline due to the elimination of the authorisation procedure and €3,230 million cost
savings generated by the reduction in time to complete the authorisation process.
Impact on market structure in the coach and bus sector: Under Option 1, it is expected
that the liberalisation of the market would lead to a more competitive market structure, at
least in Member States where the market is currently dominated by a limited number of
incumbents. Competitors are likely to focus on specific routes rather than trying to
replicate or establish national route networks. Over the longer term the evidence suggests
that after market opening, strong consolidation takes place. The competent competition
authorities have the role of ensuring that the efficiency gains resulting from the removal
of market restrictions are not unduly appropriated through the abuse of a dominant
position by one player, leading to higher fares. The inclusion of the measure abolishing
journey forms will also reduce costs of entry for the providers of occasional services.
Option 2 will have the same impact on the market structure as under Option 1 but it is
likely that there will be more rapid growth which may lead to greater fragmentation of
the market in the early years of liberalisation followed by consolidation. As mentioned
above, the competent competition authorities have the role of ensuring that the efficiency
gains resulting from the removal of market restrictions are not unduly appropriated
through the abuse of a dominant position by one player.
Option 3 will have the same impact on the market structure as under Option 2, but the
inclusion of the measure abolishing of the authorisation procedure is likely to make it
more difficult to track market developments. If the European Commission does not have
at its disposal comparable, reliable, synchronised, regular and comprehensive statistical
data on the market it makes it difficult for the European Commission to carry out the
tasks entrusted to it in the context of the common transport policy.
Potential relocation of businesses: The inclusion of a measure requiring Member States
to grant access to national markets for regular services without discrimination in Options
1, 2 and 3 will enable operators to operate in markets that were otherwise closed to them
without having to establish subsidiaries. However, in practice, operators may continue to
53
Calculated using the EU average wage (https://www.reinsfischer.com/average-salary-european-union-
2016)
and assumptions on time taken as described in table 2-6
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establish subsidiaries in different Member States for a variety of strategic and operational
reasons regardless of the regulatory environment.
We would not expect any of the options to have a material effect in the distribution of
coach companies across the EU, although there may be some migration over the long
term away from Member States whose markets are currently closed to operators
established elsewhere.
Integration of ticketing and price competition: Under Option 1 the more fragmented
market over the short term may result in less integrated ticketing since, for example,
inter-modal ticketing arrangements will be more difficult to coordinate. Consolidation of
the market could be expected to make such coordination easier. Over the longer term,
competition could lead to the creation of a wide range of multi-modal products
introduced through partnerships between coach companies and airlines as well as rail
operators.
The more effective protection of public service contracts under Options 2 and 3 due to
the inclusion of the measure to set common requirements for the protection of PSCs
meeting the needs of an urban area will help preserve integrated ticketing arrangements
in conurbations.
Level of infringements of rules on access to the market: Under Option 1 the rules
governing access to national markets will be streamlined and it is expected that there will
be fewer opportunities for operators to infringe them and hence fewer recorded
infringements. However, it is possible that a greater level of market activity could result
in some remaining rules, for example those protecting PSCs, to be infringed more
frequently.
Option 2 should also result in fewer infringements due to the streamlining of market
access rules, including those protecting PSCs.
The inclusion of the measure abolishing the authorising procedure in Option 3 would
appear to increase the risk of infringements. The operator opening a new route would no
longer be checked immediately before commencing the route. Enforcement would have
to focus on access to the profession and the Community licence. The Member State of
establishment would have a vital role in encouraging carriers to comply with the
regulations.
Level of congestion: the changes to the level of transport activity, for both coach
transport and competing modes, imply changes to the level of externalities produced by
each transport mode. The net change in the level of congestion is based on changes to
transport activity and the demand extraction rates and is further explained in Annex 4.
The absolute reduction in car traffic as a result of the options is significant, and since car
traffic makes a major contribution to congestion the impact of the options on congestion
costs are correspondingly large. Option 1 delivers a reduction in congestion costs of in
the region of €6 billion over
the timescale of the impact assessment (expressed as present
value). Options 2 and 3 deliver a significantly greater reduction of about €15 billion in
such costs over the same period.
There is no evidence that any of the three options would lead to greater congestion in
urban areas. Urban congestion is more likely to be a result of terminals not being able to
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adequately accommodate all coaches in stands or if terminals no longer have the scope to
expand to cater for further frequency increases in coach traffic.
Economic effects for SME’s:
Under Option 1 liberalisation would provide new
opportunities for SMEs, notwithstanding the risk of consolidation over the long term. If
some new business models were to become widespread, national operators seeking to
expand their networks would provide opportunities for sub-contracting and offer benefits
that could be of considerable value to the SMEs. However these effects could be offset
by a general trend towards greater market consolidation, especially if dominant operators
emerge that prefer to manage operations in-house rather than out sourcing.
Under Option 2 the greater market stimulation would be expected to generate more
opportunities for SMEs. As the measure abolishing authorisations in Option 3 would
significantly reduce the regulatory costs faced by SMEs it would be expected to generate
even more opportunities and encourage new businesses to enter the market, either as a
sub-contractor or primary operators.
Just fewer than 60% of respondents to the public consultation have the view that
abolishing restrictions on access to national markets for regular services will have a
positive effect on the economic situation of SMEs.
Impact on public service contracts: In rail passenger transport competition takes the form
of
competition for the market
via PSC or service concessions, giving an
undertaking exclusive right to operate on a specific route or bundle of routes; or
competition in the market
where two or more operators compete on the same
route.
Ensuring the provision of public rail services usually implies the need for compensating
undertakings. Suburban and regional trains are usually run through PSC, whereas long
distance and high speed trains may be more frequently operated under competition in the
market. In most countries providing data via Railway Information Measuring and
Monitoring System (RIMMS), the PSC compensation per train-km is higher than EUR 5
(with the notable exception of the UK). There does not appear to be any difference
between the levels of PSC compensation per train-km between the group of Member
States that have liberalised their coach market and the group of Member States that limit
competition.
The portion of PSC services in total rail passenger traffic varies widely between the
Member States. As shown in the figure below the portion of PSC services as % of total
rail passenger services indicates that liberalisation of coach market appears to have little,
if any impact on the portion of rail services operated under PSC in Member States.
Figure 6-9: PSC Services as % of total rail passenger services
Non-
liberalised
coach
markets
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Liberalised
coach
markets
Source: RIMMS, 2014 data except for IE and NL (2013) and EL and ES (2012). Domestic PSO
for FR includes also train services TET, TER and Transilien (operated only by SNCF, and not
RATP)
This indicates that the introduction of commercial coach services does not appear to have
any significant impact on rail PSCs. However, in principle, it
may result in a number of
responses either by PSC operators, within any flexibility to do so provided in their
contracts, or by the competent authorities.
Responses might include changes to fares,
vehicle quality, service frequency, length of service day (from first service to last
service), off-peak and weekend provision, stopping pattern and, potentially, withdrawal.
The mechanisms by which liberalisation may result in changes to PSC services are set
out in table 6-2 below.
Table 6-2: Mechanisms by which liberalisation may result in changes to PSO services
Issue
Has the liberalisation of the coach market
resulted in loss of revenue to services?
If there has been a loss of revenue, has the
operator of those services detected this effect?
Details
This appears likely to be the case except where the
coach service is in a wholly new market and does
not abstract any passengers from existing routes.
If revenues are monitored by route, or boarding’s are
monitored by stop or service, the operator may
detect the effect.
However, in a large PSO operation, with no detailed
revenue reporting, the effect of minor competition
may not have been noticed.
If the operator has detected the effect, can it
identify on which services the revenue is being
lost?
If the operator can identify on which services the
revenue is being lost, can it identify a service
reduction plan (including complete closure)
which would mitigate the losses?
If the operator can identify a service reduction,
can it implement it?
As above, this may depend on the level of
monitoring and revenue reporting of the operator.
This may depend on many operational practicalities.
For example, if a liberalised service takes demand
from the centre of a route which remains busy at the
ends, there may be no saving from cutting the route
into two.
To implement a service reduction it may still need to
be consistent with the public service contract and/or
overall transport policies or labour agreements. For
example, a requirement that all services remain at
least hourly, or of no compulsory redundancies, or
vehicle leases which do not expire for a long period,
may mean no change in response to loss of revenue.
Cost-recovery may be so low that any further loss of
revenue is immaterial.
If the operator can implement a service
reduction, will it be material?
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If all the above are true:
The PSO operator may cut back services to
the extent that is permitted by its contract.
The competent authority may change the
specification of services in the next contract.
If any of the above are true:
In a net cost contract, the PSO operator may
accept revenue losses.
In a gross cost contract, or where there is an
internal operator, the competent authority may
accept revenue losses.
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
In summary, competent authorities specifying PSC services, prima facie:
may not bear revenue risks, in the case of net cost contracts; However, operators
may stop operating under PSC if operations turn out to be financially
unsustainable.
may continue to provide services on social grounds irrespective of losses if
politically acceptable; and/or
may set fares much lower than costs, so that large revenue losses have relatively
little effect on subsidy; and/or
may make no change until the next contract is awarded, which may be up to 15
years away.
Under option 1 all PSCs remain protected so there is no impact. Under options 2 and 3
PSCs would be affected as follows:
liberalised services required to carry passengers 100 kilometres more would only
affect a small proportion of public service contracts, because many routes
operated in accordance with public service obligations are under 100 kilometres
long and passenger journeys on them are implicitly shorter;
where cost-recovery is low, revenue loss has limited impact on overall subsidy;
and
publicly contracted services affected by liberalisation may not change until
contracts are renewed.
Where coach markets have been liberalised, we have found no evidence of
competent authorities awarding public service contracts or public service operators
citing it as a major cause of reductions in the services provided or closing of lines.
Member States such as FR, DE, IT, and SE who have already liberalised their markets
have not reported during the consultation that there has been a requirement to increase
subsidies or that there has been any loss of public service contract revenues. The opening
of market access also provides the opportunity for competent authorities to reorganise
existing PSC after their which may result in significant cost savings and/or also reduce
travel times by taking advantage of the best of coach and rail.
There is specific evidence from France, Spain and Sweden an EU-wide study on PSO
night trains that provides detailed information on the financing of PSCs. A summary of
the findings are in the table below, and more detailed information are in Annex 7.
Table 6-3: Summary of evidence of impacts of liberalisation on PSOs
Source
Public Service
Contract
duration
Evidence
Whatever impacts on demand and revenue, PSO services may not change until
contract renewal, which may be as long as 10-15 years.
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France
Spain
Sweden
EU-wide
SNCF expects to lose 15-25%
of revenue, or €1-2
billion per year, but it is not
clear what is due to coach and what is due to car-sharing.
Two of the five busiest coach routes are little more than 100 kilometres long.
ARAFER has received multiple applications to carry passengers less than 100
kilometres, although these may be between intermediate stops on longer routes.
Average passenger length on interregional services has risen to 180 kilometres,
but no equivalent information was found on regional services.
Lack of information on regional concessions, and of the mix of services in any
concessions, makes it difficult to identify where new entry might occur.
One County has no PSO services longer than 100 kilometres, and over 60% of
revenue is from routes shorter than 20 kilometres, implicitly for journeys which
are even shorter.
Cost recovery varies from 80% to almost zero, averaging 30% for all route
lengths: a given percentage loss of revenue would require a much smaller
percentage increase in subsidy.
Liberalisation in Germany, France and Italy was not cited by stakeholders as a
direct or even major cause of closures of night train services, but it had driven
their fares down.
Source: Support Study for Impact Assessment 2016 Steer Davies Gleave
The intervention of the Member States would only be required under circumstances
where commercial services serving remote areas fall below the limits acceptable to the
competent authorities. Member States will continue to be free to organise PSO’s that are
required in such a way as to ensure bus connectivity of remote urban centres under all
options. The usual model of PSO to ensure coach connectivity with remote urban areas is
the granting of public subsidies for the provision of these transportation services.
Member States have flexibility to better organise the balance between commercial and
non-commercial services and target the mobility needs of citizens. The distance threshold
should not create many distortions for PSO operators serving rural areas as in some of the
Member States that have not yet liberalised. It is estimated that less than 5% of bus and
coach revenue from PSCs relates to routes over 100km. Given that such services seem
likely to include intermediate stops rather than serving only end-to-end flows, it is
estimated that less than 2.5% of revenue relates to passenger journeys over 100
kilometres. As not all such journeys would be replaced by a commercial service, less
than 1.25% of bus and coach PSC revenue would be lost to commercial services. The
introduction of competition on these routes is likely to result in decreased revenues from
PSO passenger fares which may require an increase in public subsidies to maintain the
same level of service under all options but the increase is relatively small. This would
indicate that under all options the sustainability of public service contracts serving
remote urban areas would not be undermined.
Under PO1, a significant part of the long distance coach and bus market would not be
opened for commercial operators to address demand. The impact on PSOs is less than
under other options as all PSOs can be protected but this option also limits the
effectiveness of the market opening considerably as operators do not have the flexibility
to address demand where it is needed.
Under PO2 and PO3 the impact on PSO’s is increased as more of
the national markets
for regular services are liberalised and new services carrying passengers over distances of
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greater than 100km cannot be refused on the grounds that the service could compromise
a PSO. The distance threshold is set at a level to minimise
distortions to PSO’s whilst
maximising the impact of opening market access. Increasing the level of the distance
threshold will reduce the impact on PSOs but will also reduce the effectiveness of the
market opening.
Notwithstanding the overall abstraction of passengers from the rail sector, we estimate
the associated loss in rail revenues to be around 1.4% relative to the baseline over the
horizon of the impact assessment (expressed as present value). We therefore conclude
that the primary effect of new coach services on the railways is likely to be a requirement
for a relatively small increase in subsidy by the competent authority.
6.1.2.
Environmental impacts
The changes to the level of transport activity, for both coach transport and competing
modes, imply changes to the level of externalities produced by transport modes. The
formula used to calculate the net changes is defined in Annex 4. In this section the
impacts of the options on carbon emissions, air pollution and energy use are described. In
all cases the environmental impacts of Option 2 and Option 3 are equal as the level of
transport activity was the same in each case.
Level of carbon dioxide emissions: The savings in CO
2
emission costs are substantial.
They reflect the absolute reduction in car traffic achieved under each of the options.
Under Option 1 CO
2
emission costs are reduced by around €80 million relative to the
Baseline over the timescale of the impact assessment. Options 2 and 3 deliver
significantly greater savings with CO
2
emission costs
reduced by around €183 million in
NPV terms.
As an illustration, 2 case studies were carried out looking at the connections between
Paris and Lille and between London and Birmingham to assess the CO
2
emissions in two
different markets, respectively a recently opened market and a more mature market. In
both cases, as explained in Annex 8, the CO
2
emission impacts were important.
Passenger cars are by far the largest emitters of CO
2
serving the connection between
Paris - Lille and are responsible for in excess of 65% of all CO
2
emissions. Coaches,
together with electric trains, transporting passengers collectively are the lowest emitters
of CO
2
.
A typical rail fare would be roughly €40 with a transit time of 1 hour compared to a
typical coach fare of roughly
€15 with a transit time of 3 hours. These differences
illustrate the fact that users of rail and coach have very different preferences and that the
coach customer group are more price conscious and place less value of time.
Based on available travel statistics and CO
2
emissions per person by mode of transport, it
can be calculated that the introduction of the coach connection between Paris and Lille
has reduced transport CO
2
emissions by about 10,000 tonnes of CO
2
per annum.
Moreover, it has resulted in around 250,000 less car journeys between the cities, thereby
reducing also congestion as well as air and noise pollution.
It should be noted that this CO
2
reduction was calculated based on one of the busiest
interregional connections in Europe with the presence of a high number of parallel rail
services. Considering that rail lines are relatively limited in the EU (200,000 km)
compared to roads (5 million km), the scope for coach services
without any parallel rail
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services
is very important, and such new services would have an even more positive net
CO
2
effect, as travellers in these cases only have cars as an alternative option.
Energy use: The reduction in net energy use is also substantial. Again, it reflects the
absolute reduction in car traffic achieved under each of the options. Under Option 1 net
energy use is reduced by about 3.6 million tonnes of oil equivalent over the timescale of
the impact assessment relative to the baseline. Reflecting the increased transport activity,
Options 2 and 3 deliver significantly greater savings with a reduction of about 8.4 million
tonnes of oil equivalent relative to the baseline.
Level of air pollution: Again, the savings in net air pollution costs are substantial and
reflect the absolute reduction in car traffic achieved under each of the options. Under
Option 1 air pollution costs are reduced by around €250 million relative to the Baseline
over the timescale of the impact assessment (expressed as present value). Options 2 and 3
deliver significantly greater savings
with air pollution costs reduced by about €590
million.
6.1.3.
Social impacts
Working conditions and job quality:
This initiative on rules on access to the coach market
should be seen as part of a co-ordinated response to the social and market challenges faced.
As part of this package market and social issues in the road passenger transport sector
will become more interdependent. A holistic approach has been adopted with the social,
internal market and posting of workers' rules working better together to ensure both fair
working conditions for drivers and fair competition between operators.
The results of then open public consultation show that stakeholders have divided views about the effect of
a common framework in the EU for access to national markets for regular coach and bus services, the
effect of abolishing restrictions on access to national markets and the effect of removing the protection of
PSCs from competition. The operators and others consider that these measures will have a positive effect;
regulators are equally divided whereas National authorities and NGOs consider they will have negative
effects.
The concerns of the stakeholders have been addressed by the different interlinked
initiatives in this package: (i) internal market rules governing access to occupation of
road transport operator and access to passenger and freight markets, (ii) social rules
applicable to road transport sector, (iii) rules implementing the user and polluter pays
principle in the context of road charging and (iv) the rules on interoperable tolling
services through digital technologies. All together these initiatives jointly contribute to
fair, efficient, environmentally and socially sustainable road transport sector. In
particular, the links between the social and the internal market provisions are most
prominent. The abuse of internal market rules by applying illegal business practices, such
as: illegal cabotage, fake establishment in low-cost countries, have adverse effects on
drivers' working conditions and often deprive them from their social protection rights. In
the same vein, the misapplication of the social rules in road transport by non-respecting
the driving, working or resting time requirements or applying the terms and conditions of
employment of the low-wage country to drivers working most of the time in high-wage
countries disrupts fair competition between operators by unfair cost gains. Therefore,
solving the social challenges in the sector must go hand in hand with addressing the
internal market problematic issues. Enforcement is a cross-cutting element affecting the
effectiveness of both: the social and the internal market legislation. By strengthening
enforcement and administrative cooperation between Member States in the social rules
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and access to the occupation initiatives should contribute to ensuring fair working and
business conditions, which will enable a balance between the freedom to provide road
transport services and adequate working conditions and social protection of road
transport workers.
The on-going revision of the Posting of Workers Directive will ensure the right balance
between the need to promote the freedom to provide services and the need to protect the
rights of posted workers.
Although there is likely to be increased competitive pressure the holistic and co-
ordinated response means that other initiatives will seek to alleviate the pressure on
working conditions from the policy options on market access. These initiatives will
address any potential erosion of labour market standards that is likely to occur over time
and there does not appear to be a requirement for any further labour market policies to
address these problems.
Employment: In the calculation of the estimate of employment it is assumed that
employment grows in line with transport activity throughout the assessment period but
the estimates assume no increases in productivity. There is also strong evidence from
recently liberalised MSs such as France, Italy and Germany of the positive impact market
opening has had on employment. Market opening at the EU level is estimated to result in
an increase in employment in the coach sector. Under Option 1, it will result in about
34,000 additional employees by 2025, rising to about 37,000 by 2030.
Options 2 and 3 deliver significantly more employment with about 82,000 additional
employees by 2025, rising to about 85,000 by 2030.
We would expect that emerging technological developments in section 2.8, including the
introduction of driverless vehicles, will have an impact on the employment sector but it is
not possible to forecast these with confidence at present.
Road Safety: The impact on road safety is positive for all options. The absolute reduction
in car traffic drives savings in accident costs relative to the Baseline. Under Option 1,
savings of around €1.2 billion will be generated by 2035 relative to the Baseline
(expressed as present value). With Options 2 and 3 the savings generated increase to
around €2.8 billion relative to the Baseline over the time scale of the impact assessment
(expressed as present value).
Accessibility for people with reduced mobility, rights of the elderly and integration of
persons with disabilities: The EDF has received complaints from members who are
concerned that market opening will disadvantage people with restricted mobility. In its
view, the needs of people with reduced mobility are generally not taken into
consideration when operators are purchasing new coaches, and terminals are also poorly
equipped. However, no evidence was found indicating that market opening has resulted
in the provision of a poorer service to PRMs, affected the rights of the elderly, or the
integration of persons with disabilities more than regulated ones.
Connectivity of different social groups: To determine whether the impact of liberalisation
can be expected to be adverse or favourable overall, the following was considered:
the extent to which publicly contracted services, and existing commercial
services, are cut back in a way which disadvantages citizens with limited access
to other modes; and
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the extent to which liberalised services create new opportunities for citizens with
limited access to other modes.
On the first point, the impact is unpredictable, as it depends on many decision-makers
dealing with routes with different levels of exposure to liberalised services, different
levels of materiality to subsidy levels, different policies and different constraints.
On the second point, those introducing new services in liberalised markets are unlikely to
have data on, and hence be able to target, citizens with limited access to other modes.
They may enter the market using at least two business models:
identifying a new connection, in a new market, which can be operated
commercially: this may benefit citizens who did not have private transport; and
identifying an existing connection, in a proven market, from which they can
abstract passengers (given that the typical market positioning of coach relative to
rail and air is that it is slower but cheaper, this may benefit citizens (or non-
citizens) who could not afford access to other modes).
Evidence from the German market provides some insight into this issue, since it enables
analysis of the origins of passengers on liberalised coach services
54
. It suggests that only
around 10% of passengers had no access to other modes, but many of the others might
have had “limited” access, such as a car which was not always available to them. We also
note that more than twice as many coach passengers (30%) had come from long-distance
trains as from local or regional trains (14%).
Data from a FlixBus coach users indicates that around 70% of coach stops could have
been reached via the public transport or rail network, even if the coach journey itself was
not well-served by public transport
55
.
Liberalised services may serve points which did not previously have public transport,
particularly if they impose only a small time penalty or would be necessary in any case
for rest or a crew change. One example of the former is on the frequent Oxford Tube
coach service between Oxford and London in Great Britain, which includes a stop at the