Optimization of regulation of competition in railway passenger and freight transport in the Czech Republic

Project for 2012-2013

Technology Agency of the Czech Republic (TAČR) approved for implementation and financial support of the project “Optimization of regulation of competition in railway passenger and freight transport in the Czech Republic” within the program under the number Omega TAČR TD010063 for the period 2012-2013.

The aim of the project is to develop a comprehensive methodology for administrative procedures in the field of transport policy and competition policy in the rail sector. The project is to develop a methodology for process control competition in the market of passenger and freight transport in the Czech Republic in the context of the Common Transport Policy (CTP) and the implementation of the directives of the EU Commission, the railway packages.

The project will evaluate the current state of liberalization of the rail market in the Czech Republic and problems in this regard yet emerged. Based on the analysis and comparison of frameworks and models from abroad project suggests the concept of effective regulation and liberalization of rail transport, which will improve the framework conditions for the provision of transport services in the Czech Republic, to prevent the potential threat of discrimination claims against the Czech Republic by rail carriers and ultimately lead to savings of resources from public budgets Czech Republic, to improve the efficiency of competition policy and to optimize the distribution of negative and positive
socio-economic impact of the liberalization of transport services. Emphasis will be placed on the institutional structure and operational efficiency of the rail sector in order to set up an operationally efficient and competitive level playing field to all users of the infrastructure and methodology administrative management and decision-making in the context of competition policy that maximizes the effectiveness of management in public administration and minimize the negative impacts of regulation.

When designing a concept for further progress in liberalization and regulation of rail transport, the project will be based on the analysis of foreign models of implementation of the Directives of the European Commission (the railway packages) under the common transport policy, in particular the German model. Federal Republic of Germany is a country in the European context with highly advanced liberalization of rail transport, and long-term goals is the closest Czech transport policy. An important moment that is unique to this study is just an effort to take into account the successful models of reference countries in the formulation of recommendations for the Czech Republic and identified on the basis of international comparisons
possible risks of proceeding.

The purpose of the project is to develop a comprehensive methodology for administrative procedures in the field of competition policy in the rail sector. The project is a proposal for the regulation of competition on the market for passenger and freight transport in the Czech Republic in the context of the Common Transport Policy (CTP) and the application of the Directives of the European Commission, the railway packages. Area liberalization of railway transport one of the key policies of both the Ministry of Transport and the Office for Protection of Economic Competition, as this is one of the priority pillars of the common policies of the European Union. Clear and evidence-based recommendations for further action, including notification of potential risks with regard to developments abroad will allow the state administration of the Czech Republic to plan the next steps towards effective
regulation and at the same time will minimize the threat of potential litigation or sanctions by the European Union for failing to fulfill these objectives.

The implementation of legislative rules stemming from the EU Common Transport Policy is binding for the Czech Republic. In addition to meeting the formal commitment will result in the liberalization of rail transport to the settlement date of the deformed competitive environment, to increase the intensity of competition in the sector and greater economic efficiency operation. This will result in a longer-term saving public budgets at national and regional levels, which are to finance rail spent. Another effect is the opening of the market liberalization of rail transport services (passenger and freight) international competition, resulting in intense competition will lead to better quality and cheaper transport services and will also have a positive effect on economic performance and international competitiveness of the Czech economy, especially in accordance with the environmental requirements and the concept of sustainable development.

The issue of institutional reform and implementation of railway packages in the Czech Republic has not yet been satisfactorily resolved and conceptually. The methodology for defining the relevant market, the detection of abuse of dominant position and bid-rigging in the rail sector is also still missing. Public funds invested in this project will help prevent losses in the event of lawsuits against the Czech Republic for the lack of progress in the liberalization of rail transport, saving the expenditure of public budgets and increase the efficiency of departmental public institutions.