EC fines ČD and ÖBB €48.7 million for collusion to exclude a joint competitor

The European Commission (EC) has fined Czech Railways (ČD) and Austrian Railways Österreichische Bundesbahnen (ÖBB) a total of €48.7 million for infringing EU antitrust rules. ČD and ÖBB conspired to prevent a new entrant, RegioJet, from accessing used railcars, thereby restricting competition in the passenger rail market.

ČD and ÖBB provide passenger rail transport services in the Czech Republic and Austria. In 2011, RegioJet entered the long-distance passenger rail transport market in the Czech Republic. In order to compete with ČD and ÖBB, RegioJet relied largely on used railcars.

The EC investigation found that between 2012 and 2016, ČD and ÖBB colluded to maintain their market position and prevent RegioJet's expansion both in the Czech Republic and on the international rail route between Prague and Vienna, thereby infringing Article 101 of the Treaty on the Functioning of the European Union ("TFEU").

ČD and ÖBB have coordinated their sales processes for used ÖBB coaches for long-distance passenger transport to prevent RegioJet from buying them. The ÖBB wagons were particularly relevant to RegioJet because of their quality and modern features, but also because they were already approved for operation in the Czech Republic.

In particular, the EC found that ČD and ÖBB:

* ČD and ÖBB conspired and timed the sale of the wagons so that RegioJet could not buy used ÖBB wagons.

* manipulated the procedures for the sale of used ÖBB wagons so that ČD could buy the wagons instead of RegioJet.

* He arranged a suitable buyer other than RegioJet for the used ÖBB cars, which ČD was not interested in.

* They exchanged confidential information about the offers and the level of interest of other bidders participating in the sale.

"Today we are fining Czech Railways and ÖBB €48.7 million for joining forces in their position to prevent the expansion of rival RegioJet. They prevented RegioJet from buying the used ÖBB railcars on which RegioJet relied to compete with ČD and ÖBB. Attractive passenger rail services are key to reducing our carbon footprint and we do not tolerate any restriction of competition," said the Commission's executive vice-president responsible for competition policy Margrethe Vestager.

The fines were set on the basis of the 2006 EC Guidelines on fines. In setting the level of fines, the EC took into account various elements, including the gravity of the infringement, its geographical scope and its duration.

ÖBB cooperated with the EC under the leniency programme (leniency notice of 2006) and therefore its fine was reduced by 45 %. The reduction reflects the timing of ÖBB's cooperation and the extent to which the evidence it provided helped the EC to prove the existence of the cartel.

The breakdown of the fines imposed on each company is as follows:

European Commission/ gnews - RoZ