On December 14, the European Parliament approved the early second reading agreement on the proposals under the Market Pillar of the Fourth Railway Package. Public contracts to supply domestic passenger rail services in EU countries will normally have to be put out to tender under new rules backed by Parliament on December 14. These rules also aim to boost investment and the development of new commercial services.
Rail companies will be able to offer new commercial services on domestic lines from 14 December 2020. Competitive tendering is to become the general rule for new public service contracts from December 2023, with some exceptions.
Under the new rules, rail companies will be able to offer their services in EU domestic passenger rail markets in two ways.
First, in cases where national authorities award public service contracts to provide passenger rail services, bidding for public service contracts open to all EU rail operators should gradually become the standard procedure for selecting service providers.
These contracts, which member states use to provide public passenger transport, account for about two thirds of passenger rail services in the EU. Inviting companies to bid for them should sharpen their customer focus and save costs for the taxpayer.
National authorities will also retain the right to award contracts directly, without bidding, but if this method is used it must offer improvements for passengers or cost efficiency gains.
- Contracts awarded directly would have to include performance requirements (e.g. punctuality and frequency of services, quality of rolling stock and transport capacity).
- Direct award would be allowed for public service contracts below a certain average annual value or for annual provision of public passenger transport services by rail (EUR 7.5 million or 500,000 km).
Second, any rail company will be able to offer competing commercial services on EU passenger rail markets.
However, to ensure that services which member states want to be supplied under public service contracts continue, member states could restrict a new operator’s right of access to certain lines. An objective economic analysis by the national regulator would be needed to determine when open access can be limited.
The Fourth Railway Package is new legislation passed by the European Parliament, intended to cut out the pain and improve cross-border rail passenger services for anyone travelling across Europe.
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