Fourth Railway Package: new agreement reached by the EU Transport Council

An agreement on the general approach to the political pillar of the Fourth Railway Package was reached on Tuesday 8 October by EU Member States at the EU Transport Council.
 
The background

In January 2013, the European Commission adopted the Fourth Railway Package of measures intended to deliver better quality and more choice in railway services in Europe. The Commission’s proposals were accompanied by Steer Davies Gleave’s impact assessment of policy options for domestic passenger services, including allowing open access and requiring competitive tendering to provide public services specified by national, regional or local governments.

Early agreement was reached on the Package’s “Technical Pillar” to improve safety and interoperability. The European Railway Agency (ERA), established in 2005 at Valenciennes in France, will take on a number of powers and responsibilities held by national agencies, particularly in relation to the approval of new rolling stock.

The recent agreement

The remaining “Market Opening Pillar” and “Governance Pillar” advanced a further step on Tuesday 8 October, when European Union transport ministers endorsed the principle of gradual opening of domestic rail markets and proposals intended to provide better governance of the rail sector. This may lead to new legislation taking effect as early as 2016.

Under the market opening proposals, train operators would have non-discriminatory access to operate domestic passenger services on the network of any Member State, either competing commercially with other operators or bidding for public service contracts. Open access rail services already compete with incumbents on a number of networks, particularly on Italy’s high speed network, where state-owned Trenitalia’s competitor Italo will expand its fleet to 33 trains from December 2017.

Timescales now agreed for implementation of these changes are longer than those originally put forward by the Commission. On governance, Member States would have three years to implement key rules on independence and financial transparency, with non-discriminatory access required from 2020. On market opening, national authorities would be able to award public service contracts directly for a further ten years, and existing contracts would be allowed to run until they expire. This could mean that some networks do not hold their first competitive tenders until the 2030s.