EMTA General Meeting Prague May 2012 Round table on PSO Regulation 1370/2007 “Two years after enforcement, where are we? How efficient is the regulation? Are there necessity and ways for progress?“ Avanzata Consulting Tél: +32(0)

Why did the EU institutions adopt a new regulation ? Former Regulation (R 1191/69) dated from 1969 Did not make public service contracts compulsory for urban, suburban and regional services Failed to specify the procedures for the award of public service contracts : Application to a constantly evolving market had become difficult Result : legal insecurity Avanzata Consulting Tél: +32(0)

Entry into force and transition Regulation was adopted at the end of 2007 Entry into force : 3rd December 2009 Transition period limited to the application of article 5 concerning the way public service contracts have to be awarded : 10 years (3rd December 2019). Specific regime for existing contracts that under certain conditions may remain in force also after the entry into force of the Regulation Avanzata Consulting Tél: +32(0)

The new regulation does not have an impact on every decision The new Regulation does not interfere with the institutional structure of Member States; It does not impose or define any public service obligation; It does not impose social, environmental or quality criterias; It does not interfere with authorities’s decisions on how to organise public transport services; Avanzata Consulting Tél: +32(0)

The regulation defines a minimum content of contracts Contract must clearly define the PSOs Contract must establish the nature and extent of the exlcusive right(s) Contract must establish in a transparent manner the way compensation, if any, will be calculated. If the contract is directly awarded the calculation method defined in the annex is to be respected Contract must be of a limited duration Possibilities to impose social standards : contracts shall list the staff and give transparent details of their contractual rights Possibilities for subcontracting are limited and must be defined in the contracts. Avanzata Consulting Tél: +32(0)

Main impact : The regulation defines the rules for the award of public service contracts Concerning the award of contracts the Regulation is not the only applicable European text. Procedures of art. 5 of the Regulation have to be coordinated with public procurement directives procedures !!! Avanzata Consulting Tél: +32(0)

Coordination with public procurement directives procedures (art. 5§1) Award rules defined in Art. 5 of the Regulation apply to All train or metro contracts Any contract that takes the form of a service concession contract, whatever the transport mode concerned Importance of the risk criteria to distinguish concession contracts from simple public service contracts Public procurement directives apply to Classical contracts for the public procurement of transport services by bus or by tram (For example Euro/Km based, subcontracting) Work concession contracts Avanzata Consulting Tél: +32(0)

Award of bus and tram concessions and any metro contract Direct award to an internal operator (I.O.) Art. 5(2) Possible unless prohibited by national law I.O. controled by the competent local authority I.O. performs its passenger transport activity strictly within the territory of the competent local authority Compensation calculated in accordance with the Annex Competitive tendering procedure Art. 5(3) Procedure shall be open to all operators, fair and observe the principles of transparency and non- discrimination. No details May involve negotiations Tender documents shall be transparent about social aspects, quality standards, and subcontracting Avanzata Consulting Tél: +32(0)

Award of rail contract Direct award to any operator Possible unless prohibited by national law Contract shall not exceed 10 years (instead of 15) Publication of detailed information within one year of granting the award Compensation calculated in accordance with the Annex (net financial effect). Competitive tendering procedure Procedure shall be open to all operators, fair and observe the principles of transparency and non- discrimination. No details May involve negotiations Tender documents shall be transparent about social aspects, quality standards, and subcontracting Avanzata Consulting Tél: +32(0)

Possible direct award to any operator Whatever mode of transport is concerned, the Regulation also offers the possibility to award directly public service contracts to any operator in case of : Low value contracts : < 1 Mio. ( km/year) or 2 Mio ( km/year) when the contract is awarded to a small or medium size company (operating not more than 23 vehicles) Emergency measures (max. 2 years) Avanzata Consulting Tél: +32(0)

Consequence : Competent authorities have various tools Competent authorities may choose : Controlled competition Closed markets Mixed systems Deregulated markets Avanzata Consulting Tél: +32(0)

More than two years after the entry into force In 2011, EMTA published a study on the implementation of Regulation 1370/07 In 2011, the European Commission published a study on the implementation of Regulation 1370/07 and organised an international workshop on this subject Conclusions : The Regulation sets basis for better and more transparent public transport BUT on many issues interpretation is needed to insure proper implementation. Avanzata Consulting Tél: +32(0)