Motives vary for owner/operator split

Date: 29/04/1999

By Renée Cordes

FRANCE'S SNCF did not wait for EU transport ministers to approve legislation requiring the full separation of infrastructure management and transport operations before doing so itself.

Beating the Germans and the Italians, France's national railway company created infrastructure owner RFF in 1997, largely to reduce the operating company's debt burden but also to leave SNCF

to concentrate on investing in building up both passenger and freight activities.

Although the company has championed the separation approach, its motives for doing so were quite different from those of the European Commission when it came forward with proposals for EU-wide rules.

Acting Transport Commissioner Neil Kinnock sees the measure as a key step on the road to liberalisation, something SNCF claims to support but appears reluctant to accept in practice.

Kinnock's proposals would clarify the legal situation of infrastructure managers and transport operators, and require the separation of both profit and loss accounts and balance sheets.

SNCF chief executive Louis Gallois claims that this has worked well in France, helping to make the railways more efficient. But his company is discovering that such a system requires coordination, and plans to set up a 'high council' soon with representatives from both firms as well as employee and other groups to help formulate strategy.

But SNCF has come under fire from others in the industry and EU transport officials who express scepticism that the French method should serve as an example for the industry.

” They have done some institutional separation, but I have a strong feeling they both have the same infrastructure manager and are operated by the same owner,” said one.