General

Industry structure

How is the rail transport industry generally structured in your country?

Under prevailing Indonesian law, the same business entity can control both rail infrastructure and rail operations over that infrastructure. Currently, PT Kereta Api Indonesia (Persero) (PT KAI), a state-owned enterprise (SOE), and its subsidiaries are the only entities engaged in the rail infrastructure and rail operations industry, although other entities are free to enter the industry providing that certain requirements are met.

According to Law No. 23 of 2007 concerning Railway Transportation (the Railway Law), rail transport for public purposes is divided into the following categories.

Railway infrastructure business

A business entity that acts as a railway infrastructure operator deals with the construction, operation, maintenance and business of infrastructure. The latter must comply with the railway infrastructure standards and criteria as determined by the Ministry of Transportation (MOT) according to article 18 of the Railway Law. In this context, infrastructure means the railway, railway station and railway operation facilities that enable the train to operate.

Railway facility business

A business entity that acts as railway facility operator deals with the procurement, operation, maintenance and business of facilities. The latter must comply with the railway facility standards and criteria as determined by the MOT as stated in article 25 of the Railway Law. In this context, facility means a vehicle that moves on the railway infrastructure.

Ownership and control

Does the government of your country have an ownership interest in any rail transport companies or another direct role in providing rail transport services?

The government owns shares in PT KAI (see question 1). This is made possible because the definition of ‘business entity’, as referred to in article 1(10) of the Railway Law, includes SOEs, region-owned enterprises and Indonesian legal entities that are established solely to engage in railway business activities.

Are freight and passenger operations typically controlled by separate companies?

No. As there is no Indonesian law that prohibits freight and passenger operations from being controlled by the same company engaged in railway facility operations, PT KAI (as the only company engaged in the rail transport industry) controls both freight and passenger operations.

Regulatory bodies

Which bodies regulate rail transport in your country, and under what basic laws?

As stated in article 13(1) and (2) of the Railway Law, the development of railways, which includes regulation, control and supervision, is conducted by the government, and all matters are referred to the President.

In 2015, the President issued Presidential Regulation No. 40 concerning the Ministry of Transportation (PR 40/2015), article 18 of which states that the Directorate General of Railways (DGR) (under the MOT) has the task of formulating and implementing policy in the rail industry.

Market entry

Regulatory approval

Is regulatory approval necessary to enter the market as a rail transport provider? What is the procedure for obtaining approval?

A company engaged in railway facility operations for public purposes must have the following licences as required by article 32(1) of the Railway Law.

Business licence

The business licence for railway facility operations is valid for as long as the business entity conducts its business activities, as stated in article 338 of the Railway Law.

The MOT will then carry out an evaluation within 30 working days of receipt of the complete application for the business licence, including the required supporting documents, and will issue the business licence once the requirements for the application have been fulfilled as provided in article 16(1) of MOT Regulation No. PM 31 of 2012 concerning Licensing of Railway Facility Operations (MOT 31/2012).

Operation licence

The operation licence is valid for five years and may be extended for five years each time.

Upon receipt of an application for an operation licence, the MOT or, depending on the jurisdiction, a governor, regent or mayor will conduct an evaluation within 30 working days of receipt of the complete application and will issue the operation licence if the requirements have been met as provided in article 21 of MOT 31/2012.

Is regulatory approval necessary to acquire control of an existing rail transport provider? What is the procedure for obtaining approval?

The Railway Law and its implementing regulations are silent on any requirement to obtain regulatory approval to acquire control of an existing rail transport provider. Thus, the general rules for the acquisition of a company, as regulated in Law No. 40 of 2007 on Limited Liability Companies (the Company Law), its implementing regulations and other related laws and regulations, apply to the acquisition of a rail transport provider.

Under the Company Law, acquisition of a company may be carried out by (i) acquisition through the board of directors or (ii) procedures for acquisition directly from the shareholders.

In relation to the above and considering that the only rail transport company in Indonesia (PT KAI) is a persero (an SOE in the form of a limited liability company), the acquisition of the shares in PT KAI will be subject to the provisions contained in Government Regulation No. 33 of 2005 concerning the Privatisation Procedures for Persero Companies, as amended by GR 59 of 2009 (GR 59/2009). Based on article 1(2) of GR 59/2009, privatisation means the sale of some or all of the shares in a persero to another party.

Article 3 of GR 59/2009 provides that the government may conduct a privatisation after the House of Representatives approves the National Budget Plan containing the target state revenue from the result of privatisation. The National Budget Plan is issued annually. The privatisation plan will be contained in an annual programme, and consultation with the House of Representatives is required before implementation.

Is special approval required for rail transport companies to be owned or controlled by foreign entities?

Foreign investors, whether individuals or entities, who own or control an Indonesian legal entity, including rail transport companies, need to obtain the following approvals from the Investment Coordinating Board (BKPM).

Business identification number

A business identification number (NIB) is issued to a business after it registers with the online single submission (OSS) system, which is operated by the OSS Agency. As stated in article 21 of Government Regulation No. 24 of 2018 concerning Electronically Integrated Business Licensing Service (GR 24/2018), a business must register in order to carry out business activities, and must supply the following information to the OSS:

  • single identity number, if the business is an individual;
  • ratification of the deed of establishment or company registration number; and
  • the legal basis for establishing a public company or other business entities owned by the state.

A NIB is used by the business to obtain a business licence and a commercial or operation licence, including fulfilling the requirements of those licences. Further, the NIB shall be valid as long as the business carries out its activities in accordance with the prevailing laws as provided in article 25 of GR 24/2018.

Business licence

Article 31 of GR 24/2018 provides that a business licence must be obtained by a business that has obtained a NIB. This licence is required to commence business activities before the implementation of commercial or operational activities.

A business that has obtained a business licence may conduct the following activities: land acquisition; change of land area; construction of buildings and their operation; equipment or facility procurement; human resources recruitment; completion of certification or worthiness; production commissioning; and implementation of production.

Commercial or operational licence

A commercial or operational licence is required to carry out commercial or operational activities. According to article 39 of GR 24/2018, the companies applying for this licence must meet certain requirements regarding standards, certifications, licences or registrations (eg, Good Manufacturing Practice certification, import approvals), in order to receive the commercial licence, which is issued by the OSS Agency.

Is regulatory approval necessary to construct a new rail line? What is the procedure for obtaining approval?

A business entity that operates railway infrastructure must have the following licences as required in article 24(1) of the Railway Law.

Business licence

Prior to the implementation of the construction of railway infrastructure, a railway line route must be determined. A business entity may apply for the determination of a railway line route to the MOT or a governor, regent or mayor as provided in articles 4 and 5 of MOT Regulation No. PM 66 of 2013 concerning the Licensing of Implementation of Railway Infrastructure (MOT Regulation 66/2013). A business entity that intends to operate railway infrastructure must be designated a public railway infrastructure operator by the MOT or a governor, regent or mayor prior to the issuance of the business licence.

A business entity that has been designated as a public railway infrastructure operator and already has a technical plan will be granted the right to operate the railway infrastructure, which will be regulated in a railway infrastructure operation agreement as stated in article 9 of MOT Regulation 66/2013. The business entity must also apply for a business licence to operate railway infrastructure after it is has been designated as a public railway infrastructure operator.

The MOT or a governor, regent or mayor will then carry out an evaluation and assessment within 30 working days of the receipt of the complete application, and will issue the business licence no later than 14 working days after it has been determined that the applicant requirements have been met, as provided in article 21 of MOT Regulation 66/2013.

Construction licence

Article 29 of MOT Regulation 66/2013 provides that a business entity may apply for a railway infrastructure construction licence after it has obtained a business licence, fulfilled its obligations as referred to in article 22(1) of MOT Regulation 66/2013, and signed the railway infrastructure implementation agreement. A building construction permit and other permits are needed to meet the technical requirements for the issuance of a construction licence.

The application for a construction licence must be submitted to the DGR or a governor, regent or mayor in accordance with their respective authorities.

The business entity must submit an application for a construction licence to the relevant government institution together with the requirements provided for in article 29 of MOT Regulation 66/2013. The DGR or a governor, regent or mayor will then carry out an evaluation of the fulfilment of the requirements within six months of the receipt of the complete application and, if approved, the DGR or governor, regent or mayor will issue the construction permit to the business entity in 14 working days.

Operation licence

A business entity that has completed the construction of railway infrastructure must apply for the infrastructure inspection and, if it passes, the DGR will issue a certificate of fitness for the operation of railway infrastructure as provided in article 50 of MOT Regulation 66/2013. Further, a business entity that has obtained the aforementioned certificate is entitled to apply for the railway infrastructure operation licence.

The application for the operation licence must be submitted to the DGR or a governor, regent or mayor in accordance with their respective authorities.

The business entity shall apply to the relevant government institution for the operation licence together with the requirements set out in article 51 of MOT Regulation 66/2013. The DGR or a governor, regent or mayor will then carry out an evaluation of the fulfilment of the requirements within 30 working days of receipt of the complete application and, if approved, the DGR or governor, regent or mayor will issue a construction permit to the business entity in 14 working days.

In relation to the above, a railway infrastructure operator that is already engaged in railway infrastructure business may expand its rail line or increase its railway infrastructure as stated in article 60 of MOT Regulation 66/2013. In order to do this, the operator must obtain a construction licence and operation licence as well as approval from the MOT. Before a construction licence for the expansion of a rail line is granted, the business entity must amend the agreement for the railway infrastructure operation referred to in article 61 of MOT Regulation 66/2013.

Market exit

Discontinuing a service

What laws govern a rail transport company’s ability to voluntarily discontinue service or to remove rail infrastructure over a particular route?

Pursuant to article 348 of GR 6/2017, a railway facility operator that has obtained an operation licence is obliged to operate its railway facility. As stated in article 398(4) and (5) of GR 6/2017, if this obligation is not fulfilled, the entity will be subject to administrative sanctions in the following order: written warnings; suspension of the certificate or licence to operate; and revocation of the certificate or licence.

Regarding the removal of rail infrastructure over a particular route, according to article 9 of MOT Regulation 66/2013, the right to operate a business entity that has been declared a railway business provider will be governed by the agreement between the MOT or a governor, regent or mayor in accordance with their respective authorities and the business entity.

Furthermore, article 10(2) of MOT Regulation 66/2013 provides that one of the elements that must be contained in such an agreement is the mechanism for removal of the rail infrastructure over a particular route.

On what grounds, and what is the procedure, for the government or a third party to force a rail transport provider to discontinue service over a particular route or to withdraw a rail transport provider’s authorisation to operate? What measures are available for the authorisation holder to challenge the withdrawal of its authorisation to operate?

The government may force a rail transport provider to cease operations by revoking the operation licence of the company as the last phase of administration sanctions imposed on a rail transport provider that does not meet the obligations stated in the Railway Law and its implementing regulations. See article 398 of GR 6/2017.

A rail transport company whose business licence has been revoked by the DGR or a governor, regent or mayor could file a suit to challenge this administrative decision according to Law No. 5 of 1986 concerning State Administrative Court, last amended by Law No. 51 of 2009 (Law 51/2009). Article 53(1) of Law 51/2009 states the following:

A civil person or legal entity that feels its interests are being harmed by a State Administrative Decision may file a written suit with the competent court which contains the demand for the disputed State Administrative Decision to be cancelled or declared invalid, with or without any claim for compensation and/or rehabilitation.

Given the above, as the administrative decision of the DGR, governor, or regent or mayor is issued by a state administrative body, any decision rendered by it may become the object of a dispute for the following reasons (as provided in article 53(2) of Law 51/2000):

  • the administrative decision against prevailing laws and regulations; and
  • the administrative decision that goes against the general principle of good governance.

Insolvency

Are there sector-specific rules that govern the insolvency of rail transport providers, or do general insolvency rules apply? Must a rail transport provider continue providing service during insolvency?

Article 318(1) of GR 6/2017 provides that if a business entity is declared insolvent, the DGR or a governor, regent or mayor may revoke the business licence of the railway infrastructure operation for public services. Further, business licences and operation licences granted to a railway facility operator will be revoked when the operator becomes insolvent (MOT Regulation 31/2012).

However, there are no specific regulations that govern the insolvency of a railway transport provider and therefore such insolvency will be subject to the general provisions related to insolvency as regulated in Law No. 37 of 2004 concerning Bankruptcy and Suspension of Obligation for Payments of Debts (Law 37/2004).

With regard to the operation of rail transport services in the case of insolvency, article 104 of Law 37/2004 provides that a rail transport provider may continue providing services during insolvency on the condition that the business activities are conducted by a trustee or an individual appointed by the court to manage and liquidate the assets of a bankrupt debtor under the supervision of a judge (article 1(5) of Law 37/2004).

Competition law

Competition rules

Do general and sector-specific competition rules apply to rail transport?

The rail transport industry is subject to general competition rules as governed by Law No. 5 of 1999 concerning the Restriction of Monopolistic Practices and Unfair Business Competition (the Competition Law). There is no specific regulation governing competition rules for rail transport.

Regulator competition responsibilities

Does the sector-specific regulator have any responsibility for enforcing competition law?

The Commission for the Supervision of Business Competition (KPPU) has the duty to supervise the implementation of the Competition Law as stated in article 30 of the Competition Law. The President formed the KPPU by issuing Presidential Decree No. 75 of 1999 concerning Commission for the Supervision of Business Competition, last amended by Presidential Regulation No. 80 of 2008. The DGR does not have any responsibility for enforcing the Competition Law.

Article 35 of the Competition Law lists the duties of the KPPU. Moreover, according to article 36 of Competition Law, one of the authorities of the KPPU has the power to impose an administrative sanction on entrepreneurs who violate the provisions of the Competition Law.

Competition assessments

What are the main standards for assessing the competitive effect of a transaction involving rail transport companies?

There are no main standards to assess the competitive effect of a transaction involving rail transport companies. This is because the assessment made by the KPPU for determining the competitive effect is carried out case by case.

The Competition Law divides violations into two categories: prohibited agreements; and prohibited activities in which some actions of the entrepreneur are strictly prohibited, while other actions are only prohibited if they cause monopolistic practices or unfair business competition.

Further, in order to determine whether there has been a violation of the Competition Law, the KPPU may use the following evidence, among others, as stipulated in article 42 of Competition Law: witness testimony, expert testimony, letters or documents, information and entrepreneurs’ testimony.

 

Price regulation

Types of regulation

Are the prices charged by rail carriers for freight transport regulated? How?

Prices charged by rail carriers for freight transport are regulated by Government Regulation No. 72 of 2009 concerning Traffic and Railway Transport, last amended by Government Regulation No. 61 of 2016 concerning the Amendment of Government Regulation No. 72 of 2009 (GR 61/2016). Article 146 of GR 61/2016 provides that tariffs for railway transport are divided into passenger rail transport and freight rail transport.

Freight rail transport tariffs are the cost per ton per kilometre as stated in article 153 of GR 61/2016. If the goods being transported have a particular nature and certain characteristics, the cost will be determined based on the agreement between the service user and the railway facility operator in accordance with the guidelines for the determination of tariffs stipulated by the MOT. This agreement may be in the form of an agreement preceded by negotiations or an agreement on tariffs set by the railway company as stated in article 154(2) of GR 61/2016.

Are the prices charged by rail carriers for passenger transport regulated? How?

A passenger rail transport fare is the cost per passenger per kilometre, which is determined by the rail transport company as stated in article 147(1) and (2) of GR 61/2016. The fares must be announced by the rail transport company at railway stations or in the media, or both, no later than three months before they come into effect.

The rail transport company must report its fares to the MOT or the governor, regent or mayor who issued the operation licence as provided in article 148 of GR 61/2016. The MOT or governor, regent or mayor will then evaluate the determination and implementation of the fares.

The MOT or governor, regent or mayor may determine the transport fares in the following circumstances, according to article 149(1) of GR 61/2016:

  • the community has not been able to pay the fares determined by the railway infrastructure operator for economy class transport services; or
  • in an undeveloped region, where there has previously been no rail transport. In this case, the fares will usually be lower than developed regions to encourage use of rail transport and its developments in the region.

The implementing regulation on the procedures for the calculation and determination of passenger rail transport fares is MOT Regulation No. PM 17 of 2018 concerning the Guidelines for the Procedures for the Calculation and Determination of Passenger Rail Transport Fares (MOT Regulation 17/2018).

Is there a procedure for freight shippers or passengers to challenge price levels? Who adjudicates those challenges, and what rules apply?

Freight shippers or passengers may give feedback or make complaints regarding the price levels, which must be submitted to the MOT or the governor, regent or mayor that supervises the railway business, as provided in articles 393 and 394 of GR 6/2017. Such feedback may be in the form of information, suggestions or opinions and must be conveyed in written form accompanied by the complainant’s name and address attaching a photocopy of his or her identity. The MOT or governor, regent or mayor will provide a written or verbal response on the feedback from the freight shippers or passengers.

In relation to the above, articles 12(1) and 13 of MOT Regulation 17/2018 state that the DGR supervises the implementation of passenger rail transport fares by monitoring the fares printed on tickets or receipts of payment, or announcements in news or advertisements released by the advertising company employed by the rail transport company, or in print or electronic media. It will impose sanctions on the railway facility operator if the following occurs:

  • the determination and implementation of passenger rail transport fares by the railway facility operator is not in accordance with the guidelines for passenger rail transport fares as regulated in MOT Regulation 17/2018;
  • the passenger rail transport fares for economy class services assigned by the government exceed the fares stipulated by the MOT; or
  • standards of service for the transport of passengers in all classes, including economy and first class, are violated.

As stated in article 14(2) of MOT Regulation 17/2018, the sanctions imposed by the DGR on railway facility operators that violate the above-mentioned provisions will consist of the following: written warnings; suspension of the operation licence; and revocation of the operation licence.

Must rail transport companies charge similar prices to all shippers and passengers who are requesting similar service?

In providing its services to the community, a railway company must ensure that its infrastructure and facilities are available to all customers in an equal fashion as provided in article 396(1) of GR 6/2017.

However, shippers and passengers who use special services at a railway station may be subject to an additional service tariff as stated in article 57 of the Railway Law. Special services may take the form of passenger waiting areas, loading and unloading of goods, warehousing, parking of vehicles or deposit counters that are provided in the railway station.

A railway facility operator that provides transport for passengers is entitled to reduce the fares for its services on the condition that the DGR must be informed of the reduction as required by article 11 of MOT Regulation 17/2018.

Network access

Sharing access with other companies

Must entities controlling rail infrastructure grant network access to other rail transport companies? Are there exceptions or restrictions?

The Railway Law and its implementing regulations are silent on whether or not business entities controlling rail infrastructure must grant network access to other rail transport companies.

Access pricing

Are the prices for granting of network access regulated? How?

See question 19.

Competitor access

Is there a declared policy on allowing new market entrants network access or increasing competition in rail transport? What is it?

There are no specific policies on allowing new market entrants network access or increasing competition in rail transport.

Service standards

Service delivery

Must rail transport providers serve all customers who request service? Are there exceptions or restrictions?

The Railway Law and its implementing regulations are silent on whether or not rail transport providers must serve all customers who request service.

Are there legal or regulatory service standards that rail transport companies are required to meet?

According to article 2 of MOT Regulation No. PM 48 of 2015 concerning Minimum Service Standards for the Transport of People by Train (MOT Regulation 48/2015), the operation of rail transport must meet minimum service standards, including at the railway station and at the time of travelling. This applies to railway infrastructure operators that operate the railway station and provide services to customers, and to railway facility operators providing services to passengers.

Challenging service

Is there a procedure for freight shippers or passengers to challenge the quality of service they receive? Who adjudicates those challenges, and what rules apply?

Article 9(2) of MOT Regulation 48/2015 provides that the community is entitled to give advice and feedback on the minimum service standards, which must be provided either verbally or in writing to the MOT or to the DGR. However, this Regulation is silent on the procedure for freight shippers or passengers to challenge the quality of service they receive.

In relation to the above, article 310 of GR 6/2017 states that an agreement between the DGR or a governor, regent or mayor and the business entity as a requirement to obtain a business licence for the operation of public rail transport infrastructure provided in article 307 shall at least contain service performance standards and procedures for handling public complaints.

Safety regulation

Types of regulation

How is rail safety regulated?

Under the Railway Law and its implementing regulations, rail safety applies to both railway infrastructure operations and railway facility operations, as outlined below.

Railway infrastructure operation

Pursuant to article 67 of the Railway Law, railway infrastructure must meet certain eligibility requirements when in operation, including the following:

  • technical requirements relating to the system and components of the infrastructure; and
  • operational requirements relating to the capability of the infrastructure in accordance with the railway operation plan.

Railway facility operation

Every type of railway facility must fulfil the railway facility operation eligibility requirements specified in article 198 of GR 6/2017, which include testing of the railway facility by comparing the condition and functioning of the railway facility with the technical specifications; and examination of the railway facility consisting of the first test and any subsequent tests.

In connection with the above provisions, MOT Regulation No. 24 of 2015 on the Standard of Railway Safety (MOT Regulation 24/2015) specifically regulates the safety standards to be implemented by the railway infrastructure operator and railway facility operator to avoid the risk of accidents.

Articles 2 and 3 of MOT Regulation 24/2015 stipulate that operators of railway facilities and operators of railway infrastructure must meet safety standards relating to infrastructure, facilities, traffic and transport, and human resources.

Competent body

What body has responsibility for regulating rail safety?

The government - in this case the MOT - has responsibility for regulating rail safety, as article 13(1) and (2) of the Railway Law provides that a railway is controlled by the state and its development is carried out by the government. The term ‘development of the railway’ covers regulation, control and supervision.

As mentioned in question 4, the President issued PR 40/2015, article 18 of which states that the DGR as a directorate under the MOT has the duty to arrange the formulation and implementation of policy in the rail industry.

Manufacturing regulations

What safety regulations apply to the manufacture of rail equipment?

MOT Regulation 24/2015 applies to the manufacture of rail equipment.

Pursuant to article 11 of MOT Regulation 24/2015, the safety standards of the railway operations facility relate to the following: signal equipment, telecommunications equipment and electrical installation. Article 11 regulates safety standards for railway facilities that have been designed to accommodate locomotives, trains, etc.

Maintenance rules

What rules regulate the maintenance of track and other rail infrastructure?

The following regulations govern the maintenance of track and other rail infrastructure:

  • MOT Regulation No. 31 of 2011 concerning the Procedures for Inspection of Railway Infrastructure (MOT Regulation 31/2011); and
  • MOT Regulation No. 32 of 2011 concerning the standards and procedures for the maintenance of railway infrastructure.

In addition to the above regulations, with respect to the maintenance of track and rail infrastructure, there are also provisions set forth in MOT Regulation 24/2015.

What specific rules regulate the maintenance of rail equipment?

The following rules regulate the maintenance of rail equipment:

  • MOT Regulation 31/2011 concerning the Procedures for Inspection of Railway Infrastructure;
  • MOT Regulation No. 32 of 2011 concerning the Standards and Procedures for the Maintenance of Railway Infrastructure;
  • MOT Regulation No. 30 of 2011 concerning the Procedures for examination and granting Railway Infrastructure Certificates;
  • MOT Regulation No. 17 of 2011 concerning the Standards, Examination Procedures and Certification of Wagon Eligibility;
  • MOT Regulation No. 14 of 2011 concerning the Standards, Examination Procedures and Certification of Automotive Eligibility;
  • MOT Regulation No. PM 50 of 2018 concerning the Technical Requirements of Railway Electrical Installation; and
  • MOT Regulation No. 24 of 2015 concerning the Standards of Railway Safety.

Accident investigations

What systems and procedures are in place for the investigation of rail accidents?

The procedure for investigating rail accidents is regulated under Government Regulation No. 62 of 2013 on the Investigation of Transport Accidents as amended by Government Regulation No. PM 122 of 2015 (GR 122/2015).

Pursuant to article 3 of GR 122/2015, the transport accident investigation must be conducted professionally and independently, and all information relating to the cause of the accident must be obtained. Moreover, article 4 of GR 62/2013 provides that the transport accident investigation as referred to in article 3 shall be conducted by the National Committee for Transportation Safety (KNKT).

Article 6 of GR 62/2013 provides for rail accident investigations. Further, article 7 provides that such accidents consist of a collision between trains, an overturned train, a train that has plummeted or a train that has caught fire.

In addition to the above, the KNKT is a government agency that operates under the MOT that conducts investigations and research on transport accidents, and must report its findings to the MOT. The investigation and research tasks conducted by the KNKT is part of the MOT’s effort to improve transport safety. The results of the examination and research on the causes of train accidents made in the form of recommendations will be followed up by the government, the railway infrastructure operator and railway facility operators, and may be announced to the public.

Accident liability

Are there any special rules about the liability of rail transport companies for rail accidents, or does the ordinary liability regime apply?

The general provisions on the liability of rail infrastructure companies and rail facility companies are regulated in the Railway Law as follows.

Liability of railway infrastructure operator

Article 87 of the Railway Law provides the following:

  • railway infrastructure operators shall be liable to the railway facility operator and third parties for the loss resulting from an accident that occurred as a result of an error in the railway infrastructure;
  • the liability of the railway infrastructure operator to the railway facility operator is based on the cooperation agreement made between them;
  • the railway infrastructure operator shall be liable to third parties for the damage of property, or injury or death resulting from the implementation of railway infrastructure;
  • the railway infrastructure operator shall be liable to the officer of railway infrastructure (or his or her family) in the event of his or her injury or death as a result of the operation of railway infrastructure; and
  • the liability must be calculated based on the real loss suffered by the railway facility operator or third party.

 

The exceptions to the railway infrastructure operator’s liability are provided in article 88 of the Railway Law: if the authorised party (eg, a government agency) states that the loss is not the result of an error in the operation of railway infrastructure; or an event of force majeure occurred.

Liability of railway facility operator

Article 157 of the Railway Law provides the following:

  • the railway facility operator shall be liable to passengers who suffer loss, injury or death as a result of the operation of railway transport;
  • the liability starts from the moment a passenger boards the train until he or she disembarks, and is calculated based on the real loss suffered by the passenger; and
  • the railway facility operator shall not be liable for the loss, injury or death of a passenger that is not the result of the operation of the railway transport.

Regarding the transport of goods, article 158 of the Railway Law provides the following:

  • the railway facility operator shall be liable for the loss suffered by the sender of the goods owing to the loss, damage or destruction of the goods as a result of the operation of the railway transport;
  • the liability starts from when the goods are received by the railway facility operator until the delivery of goods to the receiver;
  • the loss is calculated based on the real losses suffered by the sender of the goods, not including the profit received and fee for the service that has been used; and
  • the railway facility operator shall not be liable for the loss resulting from incorrect information in the list of goods provided with their transport.

Article 159 of Railway Law provides that the railway facility operator shall not be liable for the loss suffered by a third party as a result of the operation of railway transport, except if the third party is able to prove that the loss resulted from the negligence of the railway facility operator.

The right of a third party to file an objection and compensation request to the railway facility operator shall be submitted no later than 30 days from the date of loss.

The provisions on the liability of railway infrastructure operators and railway facility operators are further regulated in GR 6/2017.

Financial support

Government support

Does the government or government-controlled entities provide direct or indirect financial support to rail transport companies? What is the nature of such support (eg, loans, direct financial subsidies, or other forms of support)?

Yes, the government provides direct assistance to railway companies in the form of subsidies. The grant is a public service obligation as stipulated in the MOT Regulation No. 68 of 2016 on Procedures for the Implementation of Public Service Obligation of Public Transport by Economy Class Service.

 

Requesting support

Are there sector-specific rules governing financial support to rail transport companies and is there a formal process to request such support or to challenge a grant of financial support?

There are no sector-specific rules governing financial support to rail transport companies.

 

Labour regulation

Applicable labour and employment laws

Are there specialised labour or employment laws that apply to workers in the rail transport industry, or do standard labour and employment laws apply?

In addition to the standard labour and employment law, the following specialised labour and employment laws apply to workers in the rail transport industry:

  • MOT Regulation No. PM 5 of 2017 on the Certificate of Railway Travel Regulators and Railway Travel Controllers;
  • MOT Regulation No. 22 of 2011 on the Certificate of Railway Inspectors;
  • MOT Regulation No. PM 5 of 2017 on the Certificates of Train Travel Arranger Proficiency and Train Travel Controllers;
  • MOT Regulation No. 19 of 2011 on the Certificate of Proficiency of Guard Railway Crossings; and
  • MOT Regulation No. 18 of 2011 on the Certificate of Railway Auditors.

Environmental regulation

Applicable environmental laws

Are there specialised environmental laws that apply to rail transport companies, or do standard environmental laws apply?

There are no specialised environmental laws that apply to rail transport companies. In other words, the general environmental law - Law No. 32 of 2009 on Environmental Protection and Management - applies to rail transport companies.