Tuesday, March 7, 2017

Spanish Rail Freight Carriers Receive Heavy Fines for Collusion

Renfe and DB Found Guilty of Stifling Competition
Shipping News Feature
SPAIN – The Spanish competition watchdog, CNMC has fined rail freight carriers Renfe and Deutsche Bahn a total of €75.6 million, over allegation that the two companies, including several subsidiaries, engaged in anti-competitive behaviour. Through alliances and agreements, the two railways, which theoretically should be in competition with each other, were able to maintain almost invariably the ‘pre-existing status quo to the liberalisation’ of the rail freight sector in Spain.

By abusing their dominant combined 80% share of the Spanish rail freight market, Deutsche Bahn and Renfe were accused of conspiring to constrain trade, by treating each other as privileged clients and providers, with Renfe also commercially discriminating against other freight companies.

CNMC imposed a penalty of €49,962,000 on two of Renfe’s subsidiaries, Renfe Operadora and Renfe Mercancías, for its part in the conspiracy to divide the market with subsidiaries from the Deutsche Bahn Group: Transfesa, Transfesa Rail, PIF, Hispanauto, Semat, DHIB, DB ML and DB SR Deutschland. The companies under the Deutsche Bahn banner were fined a total of €10,513,000.

CNMC established that the various agreements between the Renfe Group companies and the several companies of the Deutsche Bahn Group, had a detrimental effect on the competition and the alliance between the two railways in question looked to try and maintain their current dominance on the market

Renfe was fined a further €15,129,000 for its abuse of its dominant position. CNMC found that Renfe had used its position as one of the largest Spanish rail freight operator to discriminate against other railway companies, particularly members of the Association of Private Railway Companies (AEFP), the association which had also filed a complaint against Renfe that kicked off the proceedings in 2014.

Both Renfe and Deutsche Bahn have reportedly said that they would appeal the fines in Spanish courts.