Bundeskartellamt, the German Federal Cartel Office, announced that the rail incumbent Deutsche Bahn “is in violation of competition law due to abusing its market power in relation to mobility platforms” and has ordered DB to change certain practices and contractual clauses.
“The services of third-party mobility platforms making integrated route planning possible for passengers are not conceivable without including Deutsche Bahn’s offers and traffic data. Deutsche Bahn is therefore subject to abuse control under competition law and has to fulfil special obligations towards rival platforms,” Andreas Mundt, President of the Bundeskartellamt said.
Mobility platforms offer their customers comparative information on itineraries involving different means of transport and transport operators as well as the option of integrated ticketing. In this context, rail transport and the transport services offered by DB play an important role. For example, mobility platforms allow passengers to combine train tickets with flights, carsharing, long-distance coach services or rental bikes.
Deutsche Bahn is not only a dominant rail operator, but it is also a strong mobility platform itself with its online portal bahn.de and its app DB Navigator. According to the Bundeskartellamt’s findings, DB uses its key position on the transport and infrastructure markets to restrict competition from third-party mobility platforms.
In the authority’s view, DB’s clauses on advertising bans, vertical price specifications, far-reaching bans on discounts and the withholding of a commission for carrying out the payment process are anti-competitive. Following DB’s announcement made in the meantime that it no longer intended to pay mobility platforms an intermediary commission for arranging the ticket sales, the obligation to pay such a commission in accordance with antitrust compensation standards was also raised in the proceeding.
Bundeskartellamt says that in addition, DB is denying mobility platforms continuous and non-discriminatory real-time access to all the traffic data controlled by itself which are essential for organising and booking journeys including different means of transport. This includes delay data for passenger rail services as well as data on train cancellations or cancelled or additional stops, the reasons for delays or cancellations, additional runs or replacement transport services, up-to-date information on platforms or platform changes and data on major disruptions.
The new EU rail passenger rights regulation, which has been in force since 7 June 2023, requires DB to share forecast data for the purpose of informing passengers. However, in the Bundeskartellamt’s view, this is not sufficient to end the violation of competition law. The EU rail passenger rights regulation does not cover all the necessary real-time data, nor does it regulate important commercial and technical aspects of implementing data access.
Negotiations have been held and an agreement couldn’t be reached due to individual commercial requirements. “Consequently, to prevent possible practices of Deutsche Bahn favouring its own offers or providing less favourable conditions regarding access to forecast data, an official decision ordering Deutsche Bahn to stop engaging in such practices is needed,” Andreas Mundt explained.
The President of Bundeskartellamt says that the rail incumbent Deutsche Bahn has to change several contractual clauses which may put some rectrictions on competition at expense of rival mobility platforms. “We want to prevent Deutsche Bahn from expanding its dominance in passenger rail transport also to future mobility markets and from holding back innovative mobility service providers in favour of its own business interests,” he said.
To improve the situation, the institution has imposed rail incumbent Deutsche Bahn four rules including:
- mobility platforms will be able to use DB-specific terms for online and app-store advertising without any contractual restrictions imposed by DB;
- DB’s online partners will be able to use their own discount campaigns, bonus points or cashback programmes when selling DB tickets. This puts an end to the unequal treatment between third-party mobility platforms and DB itself, which in turn uses these means to advertise its own services;
- DB will have to compensate mobility service providers based on minimum competition-law standards for carrying out the booking and payment processes on behalf of DB when selling train tickets. The same applies to the intermediary commission itself; and
- The rules under the new EU passenger rights regulation regarding the provision of real-time data will be supplemented, the implementation of the commercial and technical requirements in particular will be further regulated by way of specifications and data access will be made available also with regard to real-time data of third-party rail operators. Third-party access to data has to be non-discriminatory and comparable with DB’s own access to data.
The decision to end the competition-law violation is dynamic in order to stimulate competition for smart mobility services even more than has so far been the case. In view of the constitutionally protected freedoms enjoyed by companies, the Bundeskartellamt leaves it to the contractual partners themselves to agree on the contractual details and arrange the specific contractual conditions. Negotiations will be accompanied by a system of deadlines.
DB to appeal the decision
Deutsche Bahn has announced that is rejecting the decision of Bundeskartellamt ans plans to appeal it. The decision which would require DB to make numerous changes to its sales model. The proceedings stemmed from complaints brought by several international online sales platforms.
The issue originally focused on the sharing of real-time data, including, for example, the forecast arrival and departure times of ICE and Intercity trains. DB made it clear early on that it would share its real-time data with its distribution partners starting June 7 as part of a Europe-wide package to improve passenger rights.
The rail company says that the Bundeskartellamt decision “goes far beyond the original demands and would force DB to remunerate online platforms for the sale of DB tickets, even if this does not offer any added value for DB due to DB’s own very well-developed sales channels.”
The online platforms are often backed by well-funded major U.S. banks, international asset management companies and funds. In addition, the decision would also force DB to release its trademarked terms and sales channel designations such as “DB Navigator” and “bahn.de” for search engine marketing of the online platforms. As a result, customers searching for the term “bahn.de,” for example, may end up on the page of an online platform. This allows the platforms to steer customers away from DB channels to their own channels.
The rail incumbent Deutsche Bahn says also that the decision of the Federal Cartel Office has also huge financial consequences due to the required changes of the sales model and they will not be compensated by corresponding savings or additional revenues. With its smart mobility platforms “DB itself has high-performing and effective sales platforms which it wishes to invest in and expand. The decision will place additional financial burdens on DB, which in the worst case will lead to higher ticket prices and lower investment,” DB explains.
On the other hand, AllRail, the Alliance of Passenger Rail New Entrants in Europe, says that the deiscion of the Federal Cartel Office is a strong signal for a major rail reform in Europe and calls the ruling to be applied to all rail operators in Europe who use monopolistic behaviour. “The EU and Member States need to finally break cartels such as DB in order to enable more competition, digitalisation and innovation for consumers, and a real chance to reduce the high carbon emissions from transport,” the association highlights.
“Anti-competitive behaviour is not allowed, and Europe must act on this momentum to distribute the power away from dominant rail incumbents – like DB – in order to ensure it is shared by smaller existing companies and future start-ups who want a fair chance when entering the market,” AllRail Secretary General Nick Brooks said.
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