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Antitrust: Commission Fines Three EU Railway Companies €48 Million for Customer Allocation Cartel



The European Commission has fined railway companies Österreichische Bundesbahnen(ÖBB),Deutsche Bahn (DB) and Société Nationale des Chemins de fer belges / Nationale Maatschappij der Belgische Spoorwegen (SNCB) a total of €48 million for breaching EU antitrust rules.


The companies participated in a customer allocation cartel, which concerned cross-border rail cargo transport services on blocktrains on key rail corridors in the EU. The three companies admitted their involvement in the cartel and agreed to settle the case.


Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “Rail transport of cargo is vital for a sustainable economy model. Fair competition is important to provide customers with the best offer when using sustainable transport. A cartel between key operators offering rail cargo services on essential rail corridors across the EU goes fundamentally against this objective. Today's decision sends a clear signal that this type of collusive behaviour is not acceptable.”


The infringement concerned cross-border rail cargo transport services in the EU provided by ÖBB, DB and SNCB under the freight sharing model and carried out in “blocktrains”.


Blocktrains are cargo trains shipping goods from one site, such as the production site of the vendor of the transported goods to another site, such us a warehouse, without being split up or stopped on the way.


Under the freight sharing model, which is a contract model foreseen in international railway law, railway companies performing cross-border rail services provide customers with a single overall price for the service required under a single multilateral contract.

The Commission's investigation revealed that the three railway companies coordinated by exchanging collusive information on customer requests for competitive offers and provided each other with higher quotes to protect their respective business. The companies thus participated in a customer allocation scheme, which is prohibited under EU competition rules.


The anti-competitive conduct lasted from 8 December 2008 to 30 April 2014, with SNCB participating only since 15 November 2011 and only for transports by ÖBB, DB and SNCB. The cartel concerned conventional cargo transport sectors (except automotive transports).


As ECOPNET (European Cooperation & Partnership Network) we would like to inform our partners that the Commission has introduced a tool for citizens to alert anti-competitive conduct while maintaining their anonymity through a specifically designed encrypted messaging system. We are ready to guide and assist our partners about other relevant regulatory decisions that the EU have reached regarding competition law as well as organise events on the competition law and training programmes on multiple dimensions of this significant area.

Fines


The fines were set on the basis of the Commission's 2006 Guidelines on fines.


In setting the level of fines, the Commission took into account, in particular, the sales value achieved by the cartel participants for the services in question in the EU in 2013 (the last full year of infringement), the serious nature of the infringement, the geographic scope and the duration of each undertakings participation in the infringement.


The fine for Deutsche Bahn AG was increased by 50% since it had previously been held liable for another cartel and was therefore considered a repeat offender.


Under the Commission's 2006 Leniency Notice:

  • ÖBB received full immunity, thereby avoiding an aggregate fine of ca. € 37 million.

  • DB and SNCB benefited from a reduction of their fines for their cooperation with the Commission during the investigation. The reduction reflects the timing of the cooperation and the extent to which the evidence provided helped the Commission to prove the existence of the cartel in which they were involved.

In addition, the Commission applied a reduction of 10% on the fines imposed under the Commission 2008 Settlement Notice in view of their acknowledgment of their participation in the cartel and of their liability in this respect.




Source: European Commission Press Corner

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