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EU Fines Czech, Austrian Rail Operators €48.7M for Market Collusion

By  |  October 27, 2024

The European Commission has levied fines totaling €48.7 million ($52.6 million) against Czech rail operator České dráhy (ČD) and Austrian rail operator Österreichische Bundesbahnen (ÖBB), alleging violations of European Union antitrust laws. The Commission’s decision centers on findings that the two rail companies collaborated to impede competitor RegioJet’s market entry and expansion by restricting its access to vital rail equipment, specifically used passenger wagons.

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    According to a statement from the Commission, the investigation uncovered that ČD and ÖBB coordinated efforts to limit RegioJet’s access to essential rolling stock, hindering the competitive landscape for rail passenger transport in the Czech market. This restrictive practice, in place from 2012 to 2016, was deemed an intentional strategy to maintain a dominant market position and obstruct RegioJet’s growth, especially on high-demand routes such as the Prague-Vienna line.

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    The Commission’s investigation revealed that ČD and ÖBB not only managed wagon sales in a coordinated manner but also manipulated bidding processes to block RegioJet from purchasing high-quality, used wagons previously owned by ÖBB. These wagons were considered pivotal for RegioJet’s operations due to their modern features and regulatory approval for service in the Czech Republic. By barring RegioJet from these resources, the two companies effectively stifled potential competition, significantly impacting RegioJet’s ability to expand its services, per a statement from the European Commission.

    Furthermore, it was disclosed that the companies exchanged sensitive bidding information to thwart RegioJet’s acquisition attempts, thereby compromising the integrity of the bidding process. According to the Commission, such actions represent a clear breach of EU antitrust rules designed to foster fair competition and protect market access across member states.

    “The anti-competitive conduct exhibited by České dráhy and Österreichische Bundesbahnen created a significant barrier for a new competitor attempting to provide services that would benefit consumers,” stated a spokesperson from the European Commission. “This ruling underscores the EU’s commitment to enforcing rules that prevent dominant companies from abusing their market power.”

    The fines imposed—€32.6 million on ČD and €16.1 million on ÖBB—are intended to deter future anti-competitive actions within the EU rail sector. Both companies now face a decision on whether to appeal the ruling to the European courts.

    Source: Railway