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Asymmetric regulation for competition in European railways?

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  • Juan J. Montero

    (UNED University, Spain; European University Institute, Italy)

Abstract

There is an increasing number of voices calling for asymmetric regulation to reinforce competition in European railways as they are liberalized in December 2020. The regulatory framework defined in the Directives of the European Union (EU) might be insufficient to ensure effective and widespread competition. But the EU Directive declares tracks a natural monopoly, and structural measures in the form of vertical separation with transport activities have been imposed. Behavioral obligations have also been imposed on infrastructure managers in the form of access obligations. There is no room for asymmetry between competing networks, as tracks are a natural monopoly. Furthermore, as access conditions are ruled by the principle of nondiscrimination, it does not seem possible to introduce asymmetries in favor of newcomers, for instance in the form of access charges below the price charged to incumbent railway undertakings. For the rest of railway assets, which only exceptionally can be considered essential facilities, the EU Directives either impose no access obligations (rolling stock, drivers, ticketing systems) or when they impose access obligations (maintenance facilities), there is no formal asymmetry, as all undertakings are subject to the same access obligations. National regulatory authorities considering the introduction of asymmetric access obligations should take into account economic literature describing how asymmetries attract inefficient market entry, and they should consider that obligations introduced at a national level might fragment the Single European Railway Area.

Suggested Citation

  • Juan J. Montero, 2019. "Asymmetric regulation for competition in European railways?," Competition and Regulation in Network Industries, , vol. 20(2), pages 184-201, June.
  • Handle: RePEc:sae:crnind:v:20:y:2019:i:2:p:184-201
    DOI: 10.1177/1783591719861722
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    References listed on IDEAS

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    Cited by:

    1. Ristić, Bojan & Stojadinović, Nikola & Trifunović, Dejan, 2022. "Conditions for effective on-track competition in the European passenger railway market: A yardstick for regulations," Transport Policy, Elsevier, vol. 119(C), pages 1-15.
    2. Bach, Xavier & Marquet, Oriol & Miralles-Guasch, Carme, 2023. "Assessing social and spatial access equity in regulatory frameworks for moped-style scooter sharing services," Transport Policy, Elsevier, vol. 132(C), pages 154-162.
    3. Schöne, Andreas & Kunz-Kaltenhäuser, Philipp, 2022. "Track access charges in the European Union railroad sector: A consideration of company organization and institutional quality," Ilmenau Economics Discussion Papers 164, Ilmenau University of Technology, Institute of Economics.
    4. Jakub Chini & Martin Kvizda & Ondřej Špetík, 2023. "What is the real power of incumbents? Case study on the Czech Republic," Competition and Regulation in Network Industries, , vol. 24(1), pages 24-39, March.

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