DRAFT EU REGULATION ON PUBLIC SERVICE REQUIREMENTS WHICH CONSEQUENCES FOR LOCAL PUBLIC TRANSPORT?

This paper aims at presenting the draft EU regulation on public services requirements (current legal framework, reasons for updating it, main content of the new regulation) and analysing the consequences on local public transport, providing examples of various types of organisations. Prior to present the new proposal and to analyse the consequences on authorities and operators, the paper will first describe the current legal framework ruling public transport in Europe with a specific focus on financial compensations and granting of exclusive rights for operators. The paper will then describe how several legal disputes have been raised in the public transport sector and led to a strong expectation for a new regulation. The EU Commission released in July 2005 its third proposal for a “regulation on action by Member States concerning public service requirements and the award of public service contracts in passenger transport by rail, road and inland waterway”. EMTA, association of European Metropolitan Transport Authorities bringing together 32 authorities responsible for public transport, has analysed possible consequences of this regulation on the awarding of public service contracts in Europe with a focus on its member cities. The level of change expected by this draft regulation depends mainly on the institutional framework and on the status of operating companies. However, rules applying for the award of public service contracts can have substantial impacts on all public transport authorities. Impacts of the draft regulation can be evaluated through three items: the organisational impacts, the consistence of public transport networks and the provision of services. A political agreement has been reached on this text in June 2006 by the Transport Council. The Council should then adopt a common position and publish the updated text for transmission to the European Parliament in Autumn 2006 for the second reading. Despite a high probability of being adopted, the final content of the regulation is not determined yet. This paper is based on the 2005 Commission proposal and the text adopted by the Transport Council following the political agreement reached in June 2006