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Regulation of the Railway Industry Regulation of the Railway Industry vol. 21 I n°1 I 2019 « au service de l’analyse » — since 1998 quarterly contents Network Industries Quarterly, Vol. 21, issue 1, 2019 (March) “Regulation of the Railway Industry” dossier Across the world, railways are poised to face new challenges, as all transport modes are transformed by technological innovations, 3 Access conditions for rolling stock leasing in liberalisation, competition with other modes of transport and most Spain recently by digitalisation. Consequently, the railway industry is Ciara Vicente Mampel required to increase efficiency while ensuring security and safety, as it has to address multimodality, such as buses, as well as compete with new transport modes, such as car-sharing. Regulation of the railway 9 PTA Design and Rail Transport Quality industry and its various dimensions, not the least competition, is Daniel S. Herfurth central factor in the process of its transformation and will ultimately decide whether railways will or will not increase their modal share. This issue of the Network Industries Quarterly (NIQ) is dedicated to 14 To what extent are rail investments desirable some of the best papers presented at the Florence Conference on the for tackling climate change? Regulation of Railways, which took place on November 16 and 17, Alain Quinet and Julien Brunel 2018. Selected academics and practitioners were invited to Florence to discuss the latest developments in the field of railway regulation, such as competition in the market, role of regulatory agencies and 19 economic perspectives. How does liberalisation affect cross-border passenger rail in Central Europe? Anja Schmotz Vicente Mampel assesses the content of lease agreements concluded by the state-owned rolling stock operating company in compliance with the sectoral legislation. 23 Announcements Herfurth presents a brief result of a cross-sectional analysis of the full population of the 28 public transport authorities in charge of short- distance rail services in Germany. Quinet and Brunel look at the role of climate change in the traditional cost - benefit analysis in France, and analyse the impact of the shadow price of carbon on the socioeconomic evaluation of rail projects. Schmotz presents a research project that is to explore the shortcomings of cross-border passenger rail from an institutionalist perspective. Network Industries Quarterly | Published four times a year, contains information about postal, telecommunications, energy, water, transportation and network industries in gen- eral. It provides original analysis, information and opinions on current issues. The editor establishes caps, headings, sub-headings, introductory abstract and inserts in articles. He also edits the articles. Opinions are the sole responsibility of the author(s). Subscription | The subscription is free. Please do register at [email protected] to be alerted upon publication. Letters | We do publish letters from readers. Please include a full postal address and a reference to the article under discussion. The letter will be published along with the name of the author and country of residence. Send your letter (maximum 450 words) to the editor-in-chief. Letters may be edited. Publication director | Matthias Finger Managing editor | Irina Lapenkova Publishing editor | Ozan Barış Süt Founding editor | Matthias Finger Publisher | Chair MIR, Matthias Finger, director, EPFL-CDM, Building Odyssea, Station 5, CH-1015 Lausanne, Switzerland (phone: +41.21.693.00.02; fax: +41.21.693. 00.80; email: [email protected]; website: http://mir.epfl.ch/) dossier Access conditions for rolling stock leasing in Spain* Ciara Vicente Mampel** The offer of locomotives available in the lease market of rolling stock in Spain is basically reduced to the one that the state-owned rolling stock operating company can make available to third parties. This paper assesses the content of lease agreements concluded by said company in compliance with the sectoral legislation. 1. Addressing the issue turing of the traditional market took place by detaching he specificities of the railway sector remain an ob- the activities of administration of railway infrastructure, stacle to free competition among real or potential which constitutes a natural monopoly, from the exploita- operators that are prevented from competitive tion of the transport services, which are progressively open accessT to the market for transport services due to the exist- to competition (Cuerdo Mir 2007, Bermejo Vera 2014). ence of barriers to the entrance. In Spain, one such obstacle On one hand, the construction, management and admin- is the access to rolling stock, in particular to locomotives. istration activities of the infrastructure were entrusted in- This was reiterated by the Spain’s National Commission itially to Renfe and later Administrador de Infraestructuras for Markets and Competition (known by its Spanish acro- Ferroviarias (Adif) (Carbonell Porras 2007). On the other nym, CNMC) in a Decision of 23 May 2018 on the access hand, Spanish State created Renfe-Operadora for the provi- conditions to rolling stock of Renfe Alquiler de Material sion of passenger and freight rail transport services, which Ferroviario S.A. (hereinafter, Renfe Alquiler), which will be integrated in its assets all the movable and immovable analysed below. property of the former monopoly (Rams Ramos 2007). The commercial activity ofRenfe-Operadora is now divided Several reasons substantiate the statement of the regula- into four lines of activity (passengers, cargo and logistics, tory body. The high cost of acquiring the rolling stock and manufacture and maintenance, and asset management) by the long deadlines for its manufacture and authorisation means of four commercial companies fully owned by the for placing it in service, as well as the existence of technical State. These areRenfe Viajeros, S.A., Renfe Mercancías, S.A., differences to the European rail network (track gauge and Renfe Fabricación y Mantenimiento, S.A. and Renfe Alquil- signalling and traffic control systems), make it quite diffi- er de Material Ferroviario, S.A. (Renfe 2013) (Figure 1). cult to manufacture a rolling stock to be used across fron- Therefore, despite having a large fleet of rolling stock, this tiers. This is why the rental is naturally the most beneficial company did not develop the lease until 29 April 2014 alternative with which to acquire rolling stock in property. with the start-up of its subsidiary Renfe Alquiler, which, Nevertheless, the market for rolling stock leasing is not as has already been pointed out, is the quasi-monopolistic widespread in Spain. Unlike other European countries, provider of rental services for rolling stock nowadays. there are only two companies engaged in the purchase of railway rolling stock for its subsequent leasing. One is Al- Given that the meaningful market power of the incum- pha Trains Iberia S.L., which has its locomotive fleet leased bent and its link with the ROSCO might bring about an- as a whole. The other is Renfe Alquiler, which is a state- ticompetitive behaviours intended to hamper the proper owned rolling stock operating company (ROSCO) set up functioning of the railway sector, the Spanish legislator in 2014 and owned by the incumbent Renfe-Operadora. envisaged an ex-ante regulatory framework of obligations that imposed certain conditions in the rental services of the The Spanish railway market was traditionally character- latter. It is said that the imposition of ex-ante obligations ised by a vertically integrated public monopoly, whereby is appropriate during a transition period for the complete the State was responsible for the management of the in- liberalisation of economic sectors; mostly ‘where former frastructure and the provision of transport services. Both monopoly operators continue to benefit from inherited market activities were entrusted to Red Nacional de los Ferrocarriles power or where firms are vertically integrated’ (Slot P.J., and Españoles (Renfe) (Fernández Acevedo 2014). Nevertheless, Skudder A. 2001). Thus,Renfe Alquiler has a legal obliga- in order to meet the European requirements, the restruc- tion to provide access to rolling stock that it owns to third * The present study has been carried out in the framework of the research project ‘Ventajas y riesgos de la competencia en el sector del transporte’ (Ref. UJI-B2016-14), financed by Universitat Jaume I, Castellón de la Plana (Spain) (main researcher: M.V. Petit-Lavall). ** Predoctoral Researcher, Institute for Transport Law (IDT), Universitat Jaume I de Castelló, Spain, [email protected] Network Industries Quarterly | Vol. 21 | N°1 | March 2019 3 dossier Figure 1. The restructuring of the Spanish rail sector Source: Authors’ own compilation parties under objective, transparent and non-discrimina- ing stock that it owns, and its facilities, as well as, when ap- tory conditions pursuant to the 16th Additional Provision propriate, the management of rolling stock that belongs to of the Railways Act no. 38/2015, of 29 September, which third parties. Under a lease agreement, one of the signing extensively refers to the obligation of Renfe-Operadora to parties, called the lessor, is obliged to assign the full enjoy- ensure the independence of the board members of its sub- ment of services of goods to a third party, called the user sidiary from the transport operators who demanded the or lessee, for a specific period of time in return for regular rental services of railway rolling stock, whether public
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