Monti steps up pressure on monopolies’ abuse of position

Date: 15/05/03

By Karen Carstens

MARIO Monti, the competition commissioner, is cracking down on rail monopolies that try to exclude rival operators from the EU's networks.

The Italian warned rail bosses in a speech last year of what to expect, declaring: "I have asked my services to become more proactive in the anti-trust field in this sector."

At the same time, he said that investigations by the European Commission into Germany's Deutsche Bahn and Italy's Ferrovie dello Stato (FS) have illustrated "deficient restructuring of the industry".

Competition officials believe several member states are flouting a 12-year-old directive requiring them to separate the management and allocation of network capacity from the operation of rail services - functions which have traditionally been carried out by single state monopolies.

Officials fear infrastructure managers who still have links to service providers exclude rivals from their tracks by setting onerous technical requirements, allocating schedules that involve delays or simply over-pricing network access.

The Commission began formal legal proceedings against FS in June 2001, acting on a complaint from German operator GVG.

Since 1991, GVG has been trying to get access to the Italian railway network to provide services from German towns to Milan via Basle - a route on which it would be competing with Cisalpino, a joint venture between FS and Swiss operators. FS is under investigation for allegedly failing to name a price for the train path required by GVG on its network, and for refusing to enter a partnership for GVG to market the service.

In a parallel case, the Commission is investigating Deutsche Bahn - and its infrastructure holding DBNetz - for allegedly trying to run GVG and its Swedish partner Statens Järnväger off the rails.

Deutsche Bahn is accused of charging the partners higher prices for the provision of locomotives than it charges other operators, and for refusing to lease the engines for the service between Malmö and Berlin.

Both cases "could be in the final phases of investigation", said one Commission official. "It's about a lot of back-and-forth, petty argumentation from both sides.

"Liberalization is a grand idea, but if we cannot solve problems like these, then it's all for nought," he added.

Monti's competition watchdog has the power to impose fines of up to 10 of a company's turnover for abuses of dominant position.

Mario Monti, the European Commissioner responsible for Competition, has told Europe's rail companies that he and his team are cracking down on rail monopolies that prevent rival operators from entering the network.