Tag Archives: Compensation

Public passenger transport service by rail and road

Public passenger transport service by rail and road

Outline of the Community (European Union) legislation about Public passenger transport service by rail and road

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Competition > Rules applicable to specific sectors > Competition in transport

Public passenger transport service by rail and road

Document or Iniciative

Regulation (EC) No 1370/2007 of the European Parliament and of the Council of 23 October 2007 on public passenger transport services by rail and by road, and repealing Council Regulations (EEC) No 1191/69 and (EEC) No 1107/70

Summary

Public service compensation may be necessary to ensure the provision of services of general economic interest (SGEI) and guarantee safe, efficient, attractive and high quality passenger transport.

This Regulation applies to regular and non-limited access, national and international public passenger transport services by rail and other track-based modes and by road.

Public service contracts and general rules

The competent authority * is obliged to conclude a public service contract with the operator to which it grants an exclusive right and/or compensation in exchange for discharging public service obligations * (PSO). Obligations which aim to establish maximum tariffs for all or certain categories of passengers may be subject to general rules.

To define the framework for the competent authority, the latter grants compensation for the net positive or negative financial impact on costs and revenue occasioned by compliance with the pricing obligations established in the general rules.

The public service contracts * and general rules define:

  • the PSO to be fulfilled by the operator and the areas concerned;
  • the parameters based on which compensation must be calculated and the nature and scope of all exclusive rights granted to avoid any overcompensation;
  • the means of distributing the costs linked to service supply (staff costs, energy, infrastructure, maintenance, etc.);
  • the means of distributing income from the sale of transport tickets between the operator and the competent authority.

The duration of public service contracts is limited and must not exceed ten years for bus and coach services, and fifteen years for passenger transport services by rail or other track-based modes. This period may be extended by up to 50 % under certain conditions.

Awarding of public service contracts

Public service contracts are awarded according to the rules laid down in this Regulation. However, for awarding certain passenger transport services by bus or tram, the procedures of Directives 2004/17/EC and 2004/18/EC apply.

Subject to certain reservations detailed in Article 5 of the Regulation, local authorities may provide public transport services themselves or assign them to an internal operator over which they have control comparable to that over their own services.

Any competent authority who uses a third party other than an internal operator must award public service contracts by means of transparent and non-discriminatory competitive procedures which may be subject to negotiation.

The obligation to instigate competitive procedures does not apply to:

  • low level contracts, the average annual value of which is estimated at less than EUR 1 000 000 or which supply less than 300 000 kilometres of public passenger transport services;
  • where emergency measures are taken or contracts are imposed in response to actual or potential service interruptions;
  • regional or long distance rail transport.

Terms and conditions

The Member States have three months to provide the Commission with all the information necessary to determine whether the compensation allocated is compatible with this Regulation.

Each competent authority must publish a global annual report on the public service obligations incumbent on them and the resultant compensation received by them.

One year prior to any competitive procedure, the competent authority must ensure that the following information is published in the Official Journal of the European Union: name and contact details of the competent authority, type of allocation proposed and services and territories likely to be affected.

The Member States must gradually come into line with the Regulation, with the end of the transition period fixed at 3 December 2019.

Background

This Regulation forms part of the objectives in the Commission’s white paper of 12 September 2001 entitled “European transport policy for 2010: time to decide” and repeals Regulations (EEC) No 1191/61 and (EEC) No 1107/70.

Key terms used in the act
  • Competent authority: any public authority or group of public authorities in one or more Member States which can intervene in public passenger transport in a given geographical area, or any body invested with such power;
  • Public service obligation: requirement defined or determined by a competent authority to guarantee general interest services in terms of passenger transport which an operator, in considering its own commercial interest, would not assume or would not ensure in the same measure or under the same conditions, without compensation;
  • Public service contract: all arrangements made between one or more transport operators with one or more responsible authorities for all the rights and obligations of the service in question, including any unilateral public acts.

Reference

Act Entry into force Deadline for transposition in the Member States Official Journal
Regulation (EC) No 1370/2007 3.12.2009 OJ L 315 of 3.12.2007

Maritime safety: compensation fund for oil pollution damage

Maritime safety: compensation fund for oil pollution damage

Outline of the Community (European Union) legislation about Maritime safety: compensation fund for oil pollution damage

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Environment > Water protection and management

Maritime safety: compensation fund for oil pollution damage

Proposal

Proposal for a regulation of the European Parliament and of the Council on the establishment of a fund for the compensation of oil pollution damage in European waters and related measures [COM (2000) 802 final – Official Journal C 120 E, 24 April 2001].

Summary

Background

This proposal for a regulation forms part of the second package of Community measures on maritime safety. Following the sinking of the Erika, the Commission came to the conclusion that the existing liability and compensation arrangements failed to offer sufficient guarantees against oil pollution damage.

The objective of this proposal from the Commission is to set up a supplementary fund covering liability and compensation for pollution damage caused by oil tankers, designated COPE (Compensation for Oil Pollution in European waters fund), to pay compensation to the victims of oil spills in European waters.

The COPE Fund would top up the CLC (Convention on Liability of the Carrier) and IOPC (International Fund for Compensation for Oil Pollution Damage) systems in force at international level.

Content

The objective of this proposal is to ensure adequate compensation for pollution damage in EU waters resulting from the transport of oil by sea and to introduce a financial penalty to be imposed on any person found to have contributed to an oil pollution incident.

The proposed regulation would apply to safeguard measures to prevent or minimise such risks and to pollution damage caused:

  • in the territory, including the territorial sea, of a Member State;
  • in the exclusive economic zone of a Member State, established in accordance with international law;
  • if a Member State has not established such a zone, in an area beyond the territorial sea of that State and extending not more than 200 nautical miles.

A Fund for Compensation for Oil Pollution will be established to provide compensation to the extent that the protection afforded by the CLC Convention and the IOPC Convention is inadequate.

To this end, the COPE Fund will pay compensation to any person who is entitled to compensation for pollution damage under the IOPC Convention but who has been unable to obtain full and adequate compensation under that Convention.

No compensation will be paid by the COPE Fund until the Commission has approved the results of the relevant assessment of entitlement.

The Commission may decide not to pay compensation to any person in a contractual relationship with the carrier in respect of the operation during which the incident occurred.

Each Member State will be required to communicate to the Commission the name and address of any person who is liable to contribute to the COPE Fund. For the purposes of ascertaining who are liable to contribute to the COPE Fund and of establishing, where applicable, the quantities of oil to be taken into account for each such person, a list must be compiled and kept up to date by the Commission.

Member States will also have to lay down a system for imposing financial penalties on any person found by a court of law to have contributed, by wrongful intentional or grossly negligent acts or omissions, to an incident causing or threatening to cause oil pollution.

Three years after the entry into force of the regulation at the latest, the Commission will submit a report on the efforts made at international level to improve the international insurance and compensation arrangements.

Procedure

Codecision procedure (COD/2002/0326)

On 12 June 2002 the Commission adopted an amended proposal.
On 12 June 2002 the amended proposal was submitted to the European Parliament.

 

Compensation in cases of non-compliance with contractual quality requirements for rail freight services

Compensation in cases of non-compliance with contractual quality requirements for rail freight services

Outline of the Community (European Union) legislation about Compensation in cases of non-compliance with contractual quality requirements for rail freight services

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Transport > Rail transport

Compensation in cases of non-compliance with contractual quality requirements for rail freight services

Proposal

Proposal for a Regulation of the European Parliament and of the Council on compensation in cases of non-compliance with contractual quality requirements for rail freight services.

Summary

Compensation schemes – context

The White Paper of 2001 and the Commission Communication “Towards an integrated European railway area ” of 2002 underline the overriding importance of improving the performance of rail freight services in Europe in order to foster the development of rail freight and contribute to more balanced modal shares.

The current compensation scheme for rail freight customers is defined in the CIM appendix to the 1980 Berne Convention concerning International Carriage by Rail (COTIF).

In this context, the proposed Regulation will introduce minimum quality clauses in contracts between railway undertakings and their customers in connection with all national and international rail freight services in the Community.

Contractual quality requirements

Quality requirements for rail freight services must be based on an agreement between the parties, resulting in rights and obligations and taking into account the specific circumstances of the transport contract. The contract must define the following quality requirements:

  • agreed hand-over times for goods, wagons or trains between the railway undertaking and the rail freight customer;
  • arrival time and compensation for delays;
  • compensation in the event of goods being lost or damaged;
  • compensation in the event of a train being cancelled by the railway undertaking;
  • compensation in the event of a train being cancelled by the rail freight customer;
  • a quality monitoring system defined by the parties.

Principles of compensation in cases of non-compliance with contractual quality requirements by the railway undertaking and/or the rail freight customer

If the railway undertaking does not meet the contractual quality requirements according to the quality monitoring system defined in the transport contract, it must pay compensation to the rail freight customer. The railway undertaking is therefore responsible for:

  • loss of or damage to the goods transported;
  • failure to comply with the agreed times of arrival;
  • cancellation of trains by the railway undertaking;
  • any other failure to comply with contractual quality requirements defined by mutual agreement between the parties to the transport contract.

If the rail freight customer does not meet the contractual quality requirements according to the quality monitoring system defined in the transport contract, the rail freight customer must pay compensation to the railway undertaking. The rail freight customer is therefore responsible for:

  • failure to comply with the agreed hand-over times;
  • cancellation of trains by the rail freight customer.

Compensation in the event of losses of or damage to the goods transported

The amount of compensation for loss of or damage to the goods transported is EURO 75 per kilogram of gross mass short or damaged.

Compensation for delays

The amount of compensation for delays can be adapted according to the severity of the delay and the type of rail freight. For block trains (where the customer buys from the railway undertaking the traction for at least one train made up by the client and specifically scheduled and invoiced), the amount of the compensation must be not lower than 5% nor higher than 25% of the transport price.

For wagonloads (where the client buys from the railway undertaking the transport of at least one wagon within a train made up and scheduled by the railway undertaking and open to several clients), the amount of the compensation must be determined by mutual agreement between the parties to the transport contract, taking into account the specific nature of wagonload transport.

Compensation for lack of information about delays

If the railway undertaking does not make appropriate efforts to inform the rail freight customer about possible delays, the railway undertaking must pay the compensation specified in the transport contract that must be not lower than 5% of the transport price.

Compensation for consequential damages

If loss or damages occur as a result of the arrival time agreed in the transport contract being exceeded, the railway undertaking must pay compensation not exceeding four times the transport price, based on evidence of such losses or damages.

Compensation for cancellation of trains by the undertaking or by the rail freight customer

The parties must define in the transport contract, by mutual agreement, the amount of compensation payable in the event of the cancellation of a train by the railway undertaking or by the rail freight customer.

Exclusions of liability

Under the following conditions the compensation scheme does not apply:

  • fault of the rail freight customer or the railway undertaking,
  • fault of or any other act by a third person,
  • force majeure,
  • circumstances that the railway undertaking or the rail freight customer could not avoid.

Responsibility of the railway undertakings

The contracting railway undertaking, which has accepted goods for transport, is responsible for the transport over the entire route up to arrival, including handling and/or transhipments of the wagons or the trains. The railway undertaking is also liable for its servants and other persons, including infrastructure managers.

References

Proposal Official Journal Procedure
COM(2004) 144 Codecision COD/2004/0050

Related Acts

Convention concerning International Carriage by Rail (COTIF) of 9 May 1980 [not published in the Official Journal].

Vilnius Protocol of 3 June 1999 for the modification of the Convention concerning International Carriage by Rail (COTIF) of 9 May 1980 [not published in the Official Journal].

Recommendation for a Council Decision authorising the Commission to negotiate the conditions for Community accession to the Convention concerning International Carriage by Rail (COTIF) of 9 May 1980, as amended by the Vilnius Protocol of 3 June 1999 [COM(2002) 24 final – not published in the Official Journal].

Communication from the Commission – Further integration of the European rail system: third railway package. [COM(2004) 140 final – not published in the Official Journal].

Proposal for a Directive of the European Parliament and of the Council amending Council Directive 91/440/EEC on the development of the Community’s railways [COM(2004) 139 final – not published in the Official Journal].

Proposal for a Directive of the European Parliament and of the Council on the certification of train crews operating locomotives and trains on the Community’s rail network [COM(2004) 142 final – not published in the Official Journal].

Proposal for a Regulation of the European Parliament and of the Council on international rail passengers’ rights and obligations [COM(2004) 143 final – not published in the Official Journal].

Denied-boarding compensation system

Denied-boarding compensation system

Outline of the Community (European Union) legislation about Denied-boarding compensation system

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Transport > Mobility and passenger rights

Denied-boarding compensation system

Document or Iniciative

Regulation (EC) No 261/2004 of the European Parliament and of the Council of 11 February 2004 establishing common rules on compensation and assistance to passengers in the event of denied boarding and of cancellation or long delay of flights, and repealing Regulation (EEC) No 295/91.

Summary

This Regulation applies to:

  • passengers departing from an airport located in the territory of a Member State to which the EC Treaty applies; and
  • passengers departing from an airport located in a third country to an airport situated in the territory of a Member State to which the EC Treaty applies,

On condition that the passengers have a confirmed reservation on the flight concerned and, except in the case of cancellation, present themselves for check-in at the time indicated in advance or, if no time is indicated, not later than 45 minutes before the published departure time.

This Regulation establishes passengers’ rights if:

  • they are denied boarding against their will;
  • their flight is cancelled;
  • their flight is delayed.

This Regulation does not apply to passengers travelling free of charge or at a reduced fare not available directly or indirectly to the public.

Denied boarding

When an air carrier reasonably expects to deny boarding on a flight, it first calls for volunteers to surrender their reservations in exchange for certain benefits. If an insufficient number of volunteers come forward to allow the remaining passengers to board the flight, the air carrier may then deny boarding to passengers against their will, in which case it must compensate them.

Air carriers give priority to persons with reduced mobility and any persons accompanying them.

In the event of flight cancellation or denied boarding, the passengers concerned have the right to:

  • reimbursement of the cost of the ticket within seven days or a return flight to the first point of departure or re-routing to their final destination;
  • care (refreshments, meals, hotel accommodation, transport between the airport and place of accommodation, two free telephone calls, telex or fax messages, or e-mails);
  • compensation totalling:
    – EUR 250 for all flights of 1500 kilometres or less;
    – EUR 400 for all intra-Community flights of more than 1500 kilometres, and for all other flights between 1500 and 3500 kilometres;
    – EUR 600 for all other flights.

Delays

The Regulation introduces a three-tier system:

  • in the event of long delays (two hours or more, depending on the distance of the flight), passengers must in every case be offered free meals and refreshments plus two free telephone calls, telex or fax messages, or e-mails;
  • if the time of departure is deferred until the next day, passengers must also be offered hotel accommodation and transport between the airport and the place of accommodation;
  • when the delay is five hours or longer, passengers may opt for reimbursement of the full cost of the ticket together with, when relevant, a return flight to the first point of departure.

Upgrading and downgrading

If an air carrier places a passenger in a class lower than that for which the ticket was purchased, the passenger must be reimbursed within seven days, as follows:

  • 30% of the price of the ticket for all flights of 1500 kilometres or less;
  • 50% of the price of the ticket for all intra-Community flights of more than 1500 kilometres, except flights between the Member States and the French overseas departments, and for all other flights between 1500 and 3500 kilometres;
  • 75% of the price of the ticket for all other flights, including flights between the Member States and the French overseas departments.

References

Act Entry into force Deadline for transposition in the Member States Official Journal
Regulation (EC) No 261/2004 [adoption: codecision procedure COD/2001/305] 17.2.2005 OJ L 46 of 17.2.2004

 

EU framework for state aid in the form of public service compensation

EU framework for state aid in the form of public service compensation

Outline of the Community (European Union) legislation about EU framework for state aid in the form of public service compensation

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Regional policy > Management of regional policy

EU framework for state aid in the form of public service compensation

Document or Iniciative

Community framework for state aid in the form of public service compensation [Official Journal C 297 of 29.11.2005].

Summary

Public service compensation covers the costs incurred by operators carrying out public service tasks set by European Union (EU) country public authorities.

Along the years, both the Commission and the European Court of Justice (ECJ) have defined:

  • what state aid is but exempted (see Decision 2005/842/EC);
  • what state aid is not and therefore exempted (see European Court of Justice (ECJ) rulings ‘Altmark Trans GmbH ’ (2003) and ‘Enirisorse SpA ’ (2003)).

The aim of this framework is to define rules and principles which specify the conditions under which public service compensation not covered by Decision 2005/842/EC is compatible with Article 106(2) of the Treaty on the Functioning of the European Union (TFEU) (ex-Article 86 (2) of the Treaty establishing the European Community (TEC)). This framework applies to all activities governed by the TFEU, with the exception of the transport sector and the public service broadcasting sector.

Since EU countries have a wide margin of discretion regarding the nature of services that could be classified as services of general economic interest (SGEI), the Commission’s task is to ensure that EU countries do not stray from the definition of a SGEI laid down in Article 106(2) TFEU.

In this regard, the Commission proposes that EU countries’ national legislation should provide clear indications as regards:

  • the precise nature and duration of public service obligations;
  • the undertakings and territory concerned;
  • the nature of any exclusive or special rights assigned to the undertaking;
  • the parameters for calculating, controlling and reviewing the compensation;
  • the arrangements for avoiding and repaying any over-compensation.

Compensation may not exceed the costs of carrying out public service obligations and may only be used for the functioning of the SGEI. Public service compensation includes all advantages granted by the State in whatever form.

Compensation must be used for the operation of the SGEI concerned. Public service compensation granted for operation outside the scope of SGEI is not justified, and consequently constitutes incompatible state aid. The costs to be taken into consideration include all those incurred during the operation of the SGEI.

The revenue to be taken into account must include at least the entire revenue earned from the SGEI. The undertaking receiving public service compensation may, however, enjoy a reasonable profit. EU countries determine what amounts are to be considered reasonable profit. In this regard, they may introduce incentive criteria relating, among other things, to the quality of service provided and gains in productive efficiency.

Over-compensation constitutes incompatible state aid since it does not serve the SGEI’s function. Regular preventive checks should therefore be carried out by EU countries.

An over-compensation excess of no more than 10 % of annual compensation may however be carried into the next year. Over-compensation exceeding 10 % may exceptionally be justified if the SGEI’s function is served in the context of variable costs. This exceptional situation should be regularly reviewed and not last more than four years.

Transfers of over-compensation may take place where another SGEI is operated by the same undertaking. EU countries must ensure that such transfers are subject to proper account control and transparency according to Directive 80/723/EEC.

Public service compensation is subject to the obligation of prior notification requirement.

This framework will apply for six years following publication in the Official Journal. EU countries must bring their existing schemes regarding public service compensation into line with this framework, within 18 months of publication.

Key terms used in the act
  • Services of general economic interest (SGEI): activities inherently economic in nature, such as postal services, telecommunications, transport, or electricity or gas provision. They have a distinct European dimension and are thus regulated by a specific Community legal framework. They are also subject to internal market and competition rules as laid down in the Treaty on the Functioning of the European Union.

European schedule of occupational diseases

European schedule of occupational diseases

Outline of the Community (European Union) legislation about European schedule of occupational diseases

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Employment and social policy > Health hygiene and safety at work

European schedule of occupational diseases

Document or Iniciative

Commission Recommendation 2003/670/EC of 19 September 2003 concerning the European schedule of occupational diseases.

Summary

The Commission recommends, without prejudice to more favourable national laws or regulations, that the Member States:

  • introduce into their national legislation the European schedule in Annex I. This list covers the diseases which have been scientifically recognised as being occupational in origin, which are liable for compensation and which must be the subject of preventive measures;
  • work to introduce into their national legislation a law on compensation for occupational diseases whose origin and occupational nature can be proved, particularly if the disease is listed in Annex II;
  • progressively make their statistics concerning occupational diseases compatible with the schedule in Annex I;
  • develop preventive measures, by involving all interested parties and, where appropriate, by exchanging information, experience and good practice through the European Agency for Safety and Health at Work;
  • establish national quantified objectives with a view to reducing the rate of recognised occupational diseases, particularly those mentioned in Annex I;
  • take special account of medical information notices on diseases in the European schedule and supply other Member States, on request, with all the relevant information on diseases or agents recognised in their national legislation;
  • encourage national health systems to contribute actively towards disease prevention, in particular by raising the awareness of medical personnel in order to improve knowledge and diagnosis of these diseases;
  • introduce a system for the collection and exchange of data on the epidemiology of diseases, especially those listed in Annex II, and promote research.

The Member States themselves determine the criteria for recognising each occupational disease.

Context

This recommendation replaces Commission Recommendation 90/326/EEC of 22 May 1990 concerning the adoption of a European schedule of occupational diseases.
This new recommendation is required in order to take account of data deriving from scientific and technical progress in this field, to have an up-to-date instrument in the run-up to the European Union’s impending enlargement, and to do justice to the special interest the ” new Community strategy on safety and health at work 2002-2006 ” places on enhanced prevention of occupational diseases.

References

Act

Entry into force

Deadline for transposition in the Member States

Official Journal

Recommendation 2003/670/CE

OJ L 238 of 25.09.2003

Related Acts

Communication from the Commission of 20 September 1996 concerning the European schedule of occupational diseases [COM(96) 454 final].

In the light of information provided by the Member States, the Commission has reviewed progress in implementing the 1990 recommendation: the Member States have made great efforts to conform to Annex I to the recommendation. The Commission takes the view that at present it would be premature to propose binding legislation to replace the recommendation. However, it does intend to consider this option when the European schedule of occupational diseases is updated. This is due to take place in the first half of 2001 and is designed to take account of technical and scientific progress and the results of the work and projects currently under way to improve, inter alia, the collection, comparability and epidemiological analysis of statistics on occupational diseases.

Commission Recommendation 90/326/EEC of 22 May 1990 concerning the adoption of a European schedule of occupational diseases.