4th Interactive Session: Francesco Pacifico

On the surface, little seems to have changed.

Those who, like myself, operate regular lines bound for the then future and now new Member States, have witnessed the disappearance of certain frontiers and procedures, thereby making life easier and reducing costs.

Others, such as those colleagues engaged in both regular and occasional services at international level beyond the borders of the EU have, on the contrary, seen their problems shift to the EU's new external borders.

However, the major "enlargement" effect - which is part of the wider process of "globalisation" - is not always obvious at a glance and does not immediately impact on our turnover. The actual effect on our sector is mostly a strengthening of trends which already existed long before EU enlargement and which - for economic and political reasons - have been accentuated in almost all market segments in which we operate.

Such is the case for tourist transport for instance, where, in recent years, low-cost airlines have largely benefited from various forms of tax privileges and subsidies to considerably increase their market share to the detriment of the bus and coach sector.

Such is also the case in procurement contracts where, among other things, EU enlargement has opened the door in the new Member States to large companies, thereby enabling these groups to optimise their offer at prices verging on dumping.

These are but a few examples which clearly show that the impact of enlargement on the market must be considered and assessed in the mid and long term. Today, statistics - particularly official figures - to enable us to clearly understand this development and adjust our business strategies accordingly - are still lacking. This is why our industry has for some time been asking the Community and intergovernmental bodies to establish appropriate statistical instruments to monitor the development of domestic and international transport by bus and coach in Europe so that business strategies and political measures can be based on fact.

2.The need for a proactive political and legislative framework to guarantee equal treatment

The instances of distortion of competition and unequal treatment which I mentioned earlier show how important it is - particularly within the great EU common market, but also increasingly at pan-European level - to have common rules that are stringent, transparent and enforced in a harmonised fashion across all countries, in order to eliminate barriers and to guarantee equal treatment for all transport operators (large or small, public and private, by rail, air and road).

The private sector of public passenger transport by bus, coach and taxi, which I represent here, also needs support from political decision-makers, so as to fully exploit its advantages, such as respect for customers, reliability, safety, care for the environment and comfort.

Particularly within the EU, the European institutions and Member States' governments must recognise the fundamental contribution of bus, coach and taxi transport to the economy and the environment and take this transport mode into account in their future policy decisions. A proactive political framework must be developed and implemented both at Community and national levels to facilitate a modal shift from private cars to buses, coaches and taxis.

Where there is a political will it is always much easier to translate this into policy decisions and regulatory measures to guarantee equal chances for all.

Without an appropriate legal framework eliminating distortions of competition, thereby also contributing to a better distribution of resources and wealth, Europe is much less likely to succeed in the global competition.

This is why I would like to stress - among other things - a few demands recently made by our industry to political decision-makers at national level, at EU level and beyond, including in particular in the framework of ECMT.

2.1. Issues specific to coach and bus transport

• Concerning urban and short-distance interurban public transport and the rules on public service requirements which govern this, the IRU expects the long-awaited new proposal by the European Commission to, among other things:
• offer new opportunities for large companies and SMEs alike, while avoiding any form of dumping,
• guarantee equal treatment in relation to the railways, including on the duration of contracts in the case of coach and bus services provided by rail companies which are also active in bus and coach sector,
• ensure equal treatment for both private and public companies,
• guarantee the stringent application and enforcement of the principle of reciprocity, in particular in case of a non simultaneous opening of national markets,
• finally, to prevent discrimination vis-à-vis subcontractors, in particular in case of contracts obtained direct by public monopolies without tendering. In this case, calling for tenders from subcontractors should be prohibited.
• As for the market of intra-Community international regular services and the rules governing it, the IRU requests that:
• Regulations 684/92 and 11/98 should be amended to simplify the rules relating to the Community Licence, in order to create more harmonisation between the different national models of certified copies, facilitate enforcement and create legal certainty for operators.
• Concerning international regular services, absolute priority should be given to end discrimination in favour of rail and introduce a higher degree of fairness and transparency in the authorisation procedure, including more precise rules and shorter consultation periods. Strict rules should be established to prevent authorities refusing authorisations to operators simply to avoid granting them under the proposed automatic "tacit authorisation procedure", when the time limit for granting the authorisation under the existing procedure has not been respected by authorities.
• Concerning international regular services between EU Member States and third countries performed in the framework of bilateral agreements, the IRU remains deeply concerned about the multiplication of applicable rules, the fact that it is always extremely difficult to obtain authorisations for international regular services and the extremely heavy bureaucracy in several countries.

International regular services are still frequently delayed because of controls. Moreover, whereas international regular services are supposed to operate according to a set timetable and carry passengers to their destination according to that schedule, crossing international borders always implies extremely long waiting times since such services are not dealt with as a priority. It is imperative for authorities to put border waiting times among the major priorities of their political agenda, and make best use of technological progress.

A model bilateral agreement - such as that drawn up within ECMT in 1997 - might contribute to harmonising the many bilateral regimes currently in force. The IRU is also in favour of developing a multilateral agreement on international regular bus and coach services. Indeed, this would offer the necessary guarantees for harmonised rules throughout Europe, be it for authorising procedures (which should be transparent and fair), the duration of authorisations, including for transit (which must be harmonised) or for giving operators a possibility of appealing a decision.

Although it is impossible to check travel documents because of the material and legal conditions, under which drivers and international bus and coach operators carry out their transports, multilateral agreements and the enforcing authorities continue to impose controlling tasks on the former and oblige them to bring back passengers without valid documents.

Another particularly sensitive issue for our profession is the insufficient number, or in some cases the total lack of road passenger terminals/stations. These may become high quality mobility and passenger transit centres, which would contribute to the quality of service and to the comfort and safety of passengers both for regular and occasional services. The onus is first and foremost on the public authorities to take the initiative of implementing infrastructure which - depending on the country and the circumstances - could become excellent examples of public-private partnership.

• As for coach touring, one can but note that, first of all, a growing number of cities have taken or intend to take unilateral measures to restrict or tax the access of coaches to town centres. Therefore, the IRU urges that urgent action be taken, based on clearly-defined principles such as the recognition of the social and environmental contribution of coach tourism. Such action should be given concrete form by policies and investments in favour of coaches, equal treatment for all tourists, non-discriminatory access to tourist sites and the introduction of mechanisms for regular "public-private" consultations.

Moreover, intra-Community occasional services represent a major market segment, particularly for tours of Europe by coach for groups of tourists from other continents. According to our estimates, this segment generates a turnover of € 500 million, involving some 700 coaches in high season (April to October). Now this segment, which is among the most profitable for our industry, is currently jeopardised by legislation on driving and rest time rules currently being developed in Brussels, in particular by the proposal to introduce a rest period of 114 hours following twelve consecutive driving days.

As for occasional international bus and coach services between the EU and certain third countries, the Interbus Agreement has set an example by putting an end to the monopoly of bilateral agreements and by introducing harmonised procedures and conditions of competition. This is a first step in the right direction and, in our opinion, further ECMT Member States should also become Contracting Parties to the Interbus Agreement. This would establish a single legal framework governing this type of transport throughout Europe.

2.2. Issues of general interest

• Concerning social regulations within the EU, the IRU is deeply concerned about part of the results of the vote in the plenary session of the European Parliament on 13 April last, in particular concerning the duration and inflexibility of the daily rest time and the obligation to observe 114 hours' rest following twelve consecutive days of driving. Beyond the loss in service time and its economic consequences, this could well mean the end of some of the most profitable market segments such as European coach tours.
• As for VAT, the IRU wishes to encourage the Commission, the European Parliament and Council to accelerate this file and re-launch the discussion on amending the Sixth Directive with a view to establishing a final and harmonised VAT system for passenger transport. This final VAT system should meet at least the following 4 prerequisites:
• Distortions of competition should be eradicated. The various passenger transport modes should be subject to the same VAT rate.
• In practice, all modes should enjoy a zero rate for intra-Community international transport. This is the most beneficial solution to promote collective passenger transport.
• The rates applied to domestic transport should also be reconsidered. For some time and in the framework of a sustainable mobility policy, the European Union and several Member States have been promoting the better use of collective passenger transport. Levying VAT on domestic collective transport might be considered counter-productive in the light of this objective.
• A simple enforcement system should be implemented. Carriers should be able to declare VAT on their sales for all Community operations and claim VAT paid on entries into their country of registration. The tax authorities should serve as a clearing house to redistribute income to the authorities concerned in other Member States.

The IRU also advocates the introduction of professional diesel fuel within the EU. In our opinion, the recent European Commission proposal towards the harmonisation of taxes on professional diesel in Europe should be re-launched, however with the express goal of reducing excise duty to a standard rate applicable in all 25 EU Member States. This standard rate should clearly be set below the basic rate (€ 350 per 1 000 litres) indicated in the Commission proposal.

The IRU and its Members advises road transport operators to make sure that the impact of oil price increases is duly taken into account when negotiating long-term contracts with their customers. If possible, contracts of carriage should include a system of adjustments based on an oil price index.

3.Strengthening public-private partnership is the way forward

A true public-private partnership is essential in the face of all these challenges, together with a better balanced transport policy taking into account the needs of the private passenger transport sector by coach, bus and taxi.

This would serve to reposition the relations between the private sector on the one hand and the public sector on the other (represented by the public authorities and by semi-public undertakings) on a sound and sustainable basis by clearly defining their respective roles, i.e. with the public sector ensuring equity and guaranteeing transparency while the private sector is in charge of economic management.

This should also make it possible for society and political decision-makers to consider collective transport as a true partner, which will increase this mode's specific potential for contributing to economic, social and environmental progress in the long term, in particular through an increased use of environmentally-friendly technology and management practices.

By working together, we shall make best use of our own specific qualities so as to contribute to the well-being and prosperity of Europe and European citizens.