Tuesday, May 26, 2015

Rail Freight Group Boss Blasts Monopolies at Sea Borne Logistics Forum

Two Day Trip Exposes Again How Anti-Competitive Track Carried Cargo is Becoming
Shipping News Feature

EUROPE – Last week saw a most unusual setting for an international meeting as interested parties debated and discussed aboard a DFDS ferry travelling between Copenhagen and Oslo during the European Freight and Logistics Forum, in a 46 hour event running from 21 to 23 May. One party who didn’t mince words on the trip was Tony Berkeley, chairman of the Rail Freight Group (RFG) in the UK and a Board Member of the European Rail Freight Association.

The point made by Lord Berkeley is one which he has made many times before, and yet nothing up to now has been seen to be done about it. He pointed out that the track borne cargo carrying incumbents were buying up companies in other member states, something designed in effect to reduce competition. These comparisons show the concentration of ownership within the Société Nationale des Chemins de Fer Français (SNCF), Deutsche Bahn (DB Schenker) and Ferrovie dello Stato Italiane (FS) groups which surely indicate that, in some markets, there is a dominant position.

In addition to this, again something we have again made mention of previously, the cynical disregard of rules covering the transfer of funds between different elements of a state rail carrier, something Deutsche Bahn stands accused of, and they and others often attempt to hide behind a wall of fiscal smoke and accounting mirrors. As Berkeley points out however when quoting a senior Deutsche Bahn AG Officer at the Smartrail conference in Amsterdam on 19 May 2015, ‘DB cannot survive without transferring funds from its Infrastructure Manager to its Railway Undertakings’, something specifically forbidden under EU regulations.

On the question of monopolies the RFG head says that many of those customers present at the Freight and Logistics Forum were ‘very surprised and shocked by these changes, which they felt explained why they often got bad service from incumbents and no choice of operator’, something he says which not only emphasises the need for the 4th Railway Package to be completed by the Council and European Parliament in a manner that gives teeth to the Governance part, to bring full and fair competition above track, but also supports the strong argument for the EU’s Director General for Competition to undertake a full sector investigation into the European rail sector to identify where the market is failing.

Earlier this month Tony Berkeley pointed out the dangers of monopolisation when drivers at DB declared a six day strike saying the company fights all attempts to allow competition on regional passenger services, does its best to prevent competing intercity services by refusing to sell or lease older coaches or their tickets, and does its best to frustrate fair competition in freight. He continued at the time:

“When will Germany’s regional and national politicians realise that this strike is the result of their supporting a near monopoly instead of embracing competition above rail? There will be more strikes until people realise that that competition brings better services, competitive prices and choice, from which all benefit. It also reduces the effect of one operator’s industrial relations issues; rail can only be competitive with a variety of operators.”

Photo: The picture illustrates those DB and SNCF majority owned companies in 2000 and 2015 respectively.