The European Institutions finally reached a provisional agreement on the market pillar of the Fourth Railway Package

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Yesterday, April 19th,  after months of intensive negotiations, the Netherlands Presidency and the European Parliament reached an informal agreement regarding the opening of the domestic rail passenger markets in the member states and the governance of the railway system to ensure effective and non-discriminatory access to infrastructure.

More specifically, the agreement covers the revision of the following legislations: the Regulation governing public service contracts (PSO Regulation 1371/2007) and the Directive on the establishment of a single European railway area (Governance Directive 2012/34).

As far as the revision of the PSO Regulation is concerned, the principle of competitive award is now formally established, although numerous derogations, and therefore possibilities for direct awards, remain (small countries exemption, exceptional circumstances and performance based exemptions, emergency situations, etc.).

Considering the deadlines on which the institutions agreed, Member states will still have the possibility to directly award their contract without justification for another six years after the entry into force of the Regulation, which will take place twelve months after its publication, and these contracts will be awarded for a maximum period of ten years.

This text also lays down the obligation for the competent authority to assess whether measures to ensure a non-discriminatory access to rolling stock are necessary as well social protection provisions in case of change of operator.

On the revision of the governance Directive, the new text prepares the railway system for the opening of domestic rail passenger services (non PSOs) scheduled for December 2019. The agreed text leaves it up to Member States to decide whether a holding structure or separate infrastructure manager and railway undertaking is more suitable depending on their local conditions; however in case of holding companies, safeguard conditions are foreseen (financial transparency, independence of the board…). As for common information and through-ticketing systems, the institutions finally decided to let first the market develop; the Commission will assess the market situation by 31 December 2022, and, if needed, propose legislative measures.  

The translation works are now about to begin and the second reading vote from the European Parliament can be expected after summer, with a final adoption by the Council by the end of the year. 

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