German power grab: EU allowing Angela Merkel to spearhead European railway ‘cartel’

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Allrail, which represents independent passenger rail companies across the continent, has highlighted the hypocrisy of the bloc, given the revelation comes in the week the European Commission slapped fines totalling €48million on three companies for breaching antitrust rules when it came to freight transportation. In response, Allrail’s Secretary-General Nick Brooks highlighted what he said was the Commission’s double-standards on the issue.

He said: “One of the purported strengths of the European Union is that it is one big single market and should be a source of prosperity for its peoples.

“So the theory goes.”

The EU’s Internal Market for Aviation had permitted low-cost airlines to take on companies such as Lufthansa and British Airways, bringing down prices and permitting many more people to fly than had been able to do so in the 1960s and 1970s, Mr Brooks pointed out.

He added: “So why does the EU seem not have the strength or willpower to do the same with passenger rail and create a Single European Railway Area too?

“After all, it would be unthinkable if EU legacy airline carriers Iberia, Lufthansa, Air France etc all teamed up to form what is essentially one cartel-like arrangement whilst there were no low-cost carriers at all.

“But that scenario is effectively what is happening in EU passenger rail: the EU Commission is not enforcing a single rail market.

“The EC did yesterday expose a cartel between three such state incumbents in rail freight – great.

“But on the passenger rail side, exactly the same state incumbents are still allowed to ‘co-operate’ across internal EU borders, despite the fact that together they enjoy 92 percent market share across Europe

“So: it is perfectly reasonable to assume that the same cartel-like behaviour as in EU rail freight is happening as in EU passenger rail as well.”

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If the EU really was, as it frequently claims, a genuine single market, Commission would immediately launch an investigation into such incumbent ‘co-operations’ in passenger rail, Mr Brooks said.

He added: “These are the same EU state-owned incumbents, eg Deutsche Bahn, Nederlandse Spoorwegen and SNCF, whose subsidiaries eg Abellio, Arriva and Keolis respectively, are investing in the UK’s liberalised rail markets.

“It appears they enjoy Britain’s open market but want to keep things closed at home.”

European Commissioner Margrethe Vestager, who specialises in enforcing EU rules on competition, on Tuesday confirmed Germany’s Deutsche Bahn, Belgium’s SNCB (which owns a majority stake in Eurostar) and Austrian Federal Railways (OBB) had all been fined.

She commented: “Rail transport of cargo is vital for a sustainable economy model.

“Fair competition is important to provide customers with the best offer when using sustainable transport.

“A cartel between key operators offering rail cargo services on essential rail corridors across the EU goes fundamentally against this objective.

“Today’s decision sends a clear signal that this type of collusive behaviour is not acceptable.” has contacted the Commission to offer them a chance to respond to Mr Brooks’ comments.

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