Commission Implementing Regulation (EU) 2018/1795Show full title

Article 10 Contents of the economic equilibrium test and assessment criteria

1. The regulatory body shall assess whether the economic equilibrium of a public service contract would be compromised by the proposed new rail passenger service. Economic equilibrium shall be considered as compromised where the new rail passenger service would have a substantial negative impact on at least one of the following elements:

(a) the profitability of services that the railway undertaking operates under the public service contract;

(b) the net cost for the competent authority awarding the public service contract.

2. The analysis shall refer to the public service contract as a whole, not to individual services operated under it, over its entire duration. Predetermined thresholds or specific criteria may be applied but not strictly or in isolation from other criteria.

3. The regulatory body shall assess the net financial impact of the new rail passenger service on the public service contract. The analysis of costs and revenues generated in operating the services covered by the public service contract after the market entry of the new rail passenger service shall include the following elements:

(a) variation in costs incurred and revenues obtained by the railway undertaking performing the public service contract (including where relevant any cost savings, such as those arising from the non-replacement of rolling stock reaching the end of its useful life or staff whose contract ends);

(b) financial effects generated within the network under public service contract by the proposed new rail passenger service (such as bringing passengers who might be interested in a connection with a regional service covered by the public service contract);

(c) possible competitive responses by the railway undertaking performing the public service contract;

(d) impact on relevant investments by railway undertakings, or by competent authorities, for example in rolling stock;

(e) the value of any existing exclusive rights.

4. The regulatory body shall assess the significance of the impact taking into account, in particular, the contractual arrangements in place between the competent authority and the railway undertaking operating the public services, including where applicable the level of compensation determined in accordance with the Annex to Regulation (EC) No 1370/2007 or resulting from competitive award and any mechanisms for sharing risks such as traffic and revenue risks.

5. The regulatory body shall also assess:

(a) the net benefits to customers arising from the new rail passenger service in the short and medium term;

(b) the impact of the new rail passenger service on the performance and quality of railway services;

(c) the impact of the new rail passenger service on timetable planning for railway services.

6. Where the regulatory body is examining more than one application for access, it may take different decisions on the applications received, based on an analysis of their respective impacts on the economic equilibrium of the public service contract, competitive effects, net benefits to customers and network impacts, and of their cumulative effects on the economic equilibrium of the public service contract.

7. The assessment carried out in accordance with this Article is without prejudice to the regulatory body's obligation to report State aid issues to the national authorities in accordance with the second subparagraph of Article 56(12) of Directive 2012/34/EU.