On 8 February 2016, the CMA published its latest amendments to the Transport Ticketing Scheme Block Exemption (TTSBE) in the form of the Competition Act 1998 (Public Transport Ticketing Schemes Block Exemption) (Amendment) Order 2016. The Order followed a recommendation published on by the Secretary of State that the block exemption be renewed.
How does this affect you?
- If you are a transport operator running a ticketing scheme which benefits from the TTSBE, you may continue to benefit from it for the next ten years;
- More operators seeking to operate ticketing schemes are likely to benefit from the exemption - the definition of "multi-operator travel cards" has been changed to include arrangements between two or more (instead of three or more) operators
- The TTSBE now allows for the development of electronic ticketing formats and products leading potentially to more flexibility and increased efficiency in selling such tickets all of which enhance the customer experience and promote sales.
The current TTSBE exempts from scrutiny under Chapter I Competition Act 1998 written agreements between operators which allow passengers to buy tickets that can be used on participating operator's services.are considered to improve the quality, flexibility and ease of use of public transport schemes. However, . As such the TTSBE does not, on the whole, cover agreements between competing operators which:
- Fix fares for tickets sold under such schemes
- Carve-up routes between participating operators
- Raise barriers to entry and keep out new competitors, (for example through exclusivity provisions)
- Eliminate single and return tickets (fares for these tickets are individually set by each operator and allow competition on price between operator)
- Facilitate price-fixing through the exchange of commercially sensitive information between operators.
In particular the TTSBE exempts:
- Multi-operator travelcards (MCTs) which permit ticket holders to make a number of journeys on local public transport services operated by three or more different operators, provided the operators do not compete to provide services on the same routes; (for example, bus zonal tickets and travelcards)
- Through tickets (TTs) which entitle ticket holders to make a journey using two or more services run by different non-competing operators over a substantial part of the route covered by the ticket in question
- Multi-operator individual tickets (MITs) where two or more different operators provide competing services on a particular journey and ticket holders can choose whichever service they prefer to make this journey
- Short and long distance add-ons which allow passengers for short routes to purchase an MTC as an extension to an individual route, or, for longer routes an MTC, single operator single ticket or TT.
The Order makes the following amendments to the TTSBE:
- revises the definition of MCTs enabling the creation of MITs with less than three operators as long as such schemes are not mainly used by passengers as a multi-operator individual ticket or through ticket
- removes the obligation for tickets to be purchased in a "single transaction" thereby allowing for electronic ticketing formats and products to be developed.
The amended TTSBE will come into force on 29 February 2016 and be valid until 28 February 2026. A new review will begin on 28 February 2021. The CMA will consult on revised accompanying guidelines shortly between March - April 2016 and publish updated guidance in May 2016.