Tuesday, June 14, 2011

Rail Freight Group Reacts with Outrage at MEPs Proposals for Eurotunnel

"Conspiracy or Cock Up?" They Ask
Shipping News Feature

UK / FRANCE – Attempts by three French Members of the European Parliament (MEP’s) to gain exemption for rail services using the Tunnel from the requirements of the First Railway Package Recast, currently wending its way through the European Parliament and the Council of Ministers, has provoked outrage from the UK’s Rail Freight Group (RFG) which represents the countries rail freight community.

The amendments to the legislation would, according to the RFG, “exempt Eurotunnel from all of the requirements of liberalisation, including fair and open access, interoperability, and equitable charging”, in effect cutting the critical European link off from free market forces and undermining its use from the wider rail freight industry by shutting out opposition.

The justification for the change to the legislation is that Eurotunnel is a private company and as such the rules should not apply. In response to this the RFG says: “This is certainly a curious legal interpretation and one which, if accurate, would have wide-reaching consequences across the UK rail network and beyond.“

The RFG also says that the proposals have been expressed previously by some members of the Inter Governmental Commission (IGC) – the body that regulates the Channel Tunnel – although the trade body admits there is no evidence that these persons have been directly involved in placing these amendments.

The IGC has already been subject to criticism from the European Railway Agency (ERA) for failure to integrate its safety rules with the European Technical Standards for Interoperability (TSI).

According to the RFG, train operators are complaining not only about the high cost of using the Tunnel but also the unique technical standards which prevent innovation and competition. The group states that much of this would be resolved by infraction proceedings against the two governments, and the imposition of the standard regulation TSIs being applied to the tunnel which are, as they point out, used happily on other existing long tunnels across the continent.

The RFG’s Chairman, Tony Berkley said that:

“The original contracts between British Rail/SNCF and Eurotunnel were designed to provide a back door government guarantee to help finance the construction of the Tunnel. Out of this Usage Contract have come possible contingent liabilities on the Governments if the services reduce below a certain level. The details of these liabilities are ‘top secret’ although we understand that the freight element alone cost UK taxpayers over £8m last year – and presumably similar in France.

“So is there a conspiracy to keep things as they are, with just five freight trains a day and passenger trains that compete with Eurostar struggling to get approval, because it is all too difficult or potentially expensive for Governments, and the company would make more money if it was left to do what it liked? Or is it just a cock-up?

“We shall see, but the best way of encouraging traffic growth with no resultant call on government support is to ensure that the liberalisation policies contained in the Recast are implemented and enforced in the Channel Tunnel to make it a full part of the European rail network for passengers and freight.

“It is about time that those with an interest in the Channel Tunnel realised that long term financial success will never be achieved through an archaic form of protectionism. Only by allowing Eurotunnel and train operators to grow their businesses through free and open competition will it ever have a chance of succeeding. We urge all MEPs to oppose this amendment vigorously.”