General
Industry structure
How is the rail transport industry generally structured in your country?
Four types of railway undertakings exist: federally owned railway undertakings, privately held railway undertakings, railway undertakings owned by Germany’s federal states or local authorities, and incumbent railway companies from other EU member states, either directly or through subsidiaries.
Deutsche Bahn AG (DB AG) is the historic, incumbent rail transport company. Its subsidiaries govern, administer and maintain the German railway network and infrastructure, and are also responsible for the maintenance and exploitation of the passenger railway stations and provision of related services.
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?
DB AG is a public company - 100 per cent of its shares belong to the German state. DB Mobility logistics AG is a wholly owned subsidiary of DB AG. A partial or complete privatisation of DB AG and some of its subsidiaries is expected in the future.
Are freight and passenger operations typically controlled by separate companies?
Yes. In both the freight and passenger rail transport markets, apart from the companies that belong to the DB group, privately held railway undertakings, railway undertakings owned by Germany’s federal states or local authorities, and incumbent railway companies from other member states, either directly or through subsidiaries, are all active in these markets.
Regulatory bodies
Which bodies regulate rail transport in your country, and under what basic laws?
Rail transport is mainly regulated by the European Commission, Council and Parliament, the European Union Agency for Railways, the Federal Railway Authority (EBA), the Eisenbahn-Cert (EBC), and the Federal Network Agency for Electricity, Gas, Telecommunication, Post and Railway (FNA).
The European Union adopted a series of legislative packages that gradually liberalised the internal rail market with the aim of creating a single European railway area. This process was completed with the fourth EU railway package of 2016.
Following the entry into force of Regulation (EU) No. 2016/796 on the European Union Agency for Railways (part of the technical pillar of the fourth railway package) on 15 June 2016, the European Union Agency for Railways (ERA) replaced and succeeded the European Railway Agency. The ERA’s main objectives are interoperability of the Trans-European Rail system through the draft of mandatory technical specifications for interoperability, which are then adopted by a European Council decision. The ERA also provides recommendations to the European Commission on common safety indicators, methods and targets, and on the system of certifications of bodies in charge of safety.
The EBA is the supervisory and licensing authority, and was established by the Act on the Federal Administration of Railway Traffic of 27 December 1993, last amended 27 June 2017. It operates under the authority of the Federal Ministry of Transport and Digital Infrastructure. The EBA’s tasks include issuing licences and safety certificates (valid for both rail freight and passenger transport) and the authorisation of rolling stock, verification of subsystems, declarations of conformity of constituents, authorisations for placing in service, including the corresponding registration numbers, safety certificates, safety authorisations, notifying national safety rules, publication of annual reports, maintaining a register of infrastructure and a rolling stock register, safety reporting and monitoring interoperability.
The EBC carries out the tasks of the notified body according to Directive 2008/57/EC. It is an autonomous organisation under public law and acts as a financially and legally independent department of the EBA. The main tasks of the EBC are to assess the conformity or suitability for use of the interoperability constituents and to carry out the ‘EC’ verification of the subsystems, as mandated by this Directive.
The FNA is an independent, cross-sector authority and has been responsible for regulation of the railway sector since 2006. It is tasked with monitoring rail competition and is responsible for ensuring non-discriminatory access to railway infrastructure. It monitors compliance with the rules governing access to the infrastructure, especially in relation to the preparation of the timetable, decisions on the allocation of railway paths, access to service facilities, usage conditions and charging.
Pursuant to Directive 2004/49/EC, the role of national investigation body in Germany is assigned to the Investigation Office for Rail Accidents of the Ministry of Transport. According to article 21 of this Directive, its tasks focus on the different elements of accident investigation.
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 licence is necessary to enter the market as a rail transport provider. Article 6-6e of the General Railway Law of 27 December 1993, last amended on 20 July 2017 (AEG), sets out the relevant requirements. Article 6(3) of the AEG provides that the applicant has to have its seat in Germany or a registered office in Germany. The company must have a management structure as well as reliability, financial standing and professional aptitude (article 6a ff. AEG). Reliability means that the company should not have been subject to fines of more than €100,000 for violations of labour law, customs law or traffic law and no person in charge of management should have received sentences of more than one year for violations of labour law or social obligations, customs law or traffic law. Proof of the professional expertise can be provided with an assignment of a certified rail operations manager - in other words, a person who is trained as an engineer, has three years of experience as an engineer in the rail sector and has passed a special exam (article 6(2) AEG).
The licence as a rail transport provider alone does not entitle a company to take part in public railway operations in cross-border services. A valid safety certificate according to article 7a(1) of the AEG will be required. To operate in the state where the company is registered (ie, Germany), Part A of the safety certificate is required. In order to obtain permission to provide services in other EU member states, Part B of the safety certificate needs to be submitted in the respective country. The Statutory Regulation on Railway Security of 5 July 2007 excludes railway undertakings that are exclusively operating on regional networks from the obligation to obtain a safety certificate. Articles 14-14d of the AEG require the applicant to have liability insurance.
Is regulatory approval necessary to acquire control of an existing rail transport provider? What is the procedure for obtaining approval?
Article 6g(5) of the AEG provides that in the case of a change affecting the legal status of a company, in particular in cases of mergers or takeovers, it shall inform the licensing authority accordingly. The licensing authority has to check whether the company still fulfils the requirements of sections 6a-6e of the AEG. The company concerned may continue operations unless the licensing authority determines by order that safety is at risk. In such a case, the company in question has to cease operations immediately.
Article 6g(6) of the AEG provides that if an enterprise intends to significantly change or expand its business, it shall inform the licensing authority accordingly, and it must fulfil the requirements of sections 6a-6e of the AEG. Further general authorisations may need to be obtained from the Federal Cartel Office or the European Commission subject to the merger control rules.
Is special approval required for rail transport companies to be owned or controlled by foreign entities?
The only restrictions for foreign ownership or control of railway undertakings result from the German rules on foreign investment.
On the basis of article 55 of the Foreign Trade and Payments Ordinance of 2 August 2013, last amended on 13 December 2017 (AWV), the Federal Ministry for Economic Affairs and Energy (the Ministry) may review the acquisition of domestic companies by foreign buyers in individual cases. Any acquisition of at least 25 per cent of the voting rights of a company resident in Germany by investors located outside the European Union or the European Free Trade Association region can be investigated. In principle, the rules on foreign investment apply to any industry sector. The Ministry can prohibit the transaction or impose conditions if it considers that public order or security in Germany is threatened.
The provisions list certain industry sectors constituting critical infrastructure, which are subject to special scrutiny. In these cases a notification of the transaction to the Ministry is mandatory. According to article 55(1), sentence 3, No. 6 of the AWV this can, in particular, comprise undertakings developing software for the operation of facilities or systems for the transport of passengers and freight by rail. A decision issued by the Ministry can be challenged before an administrative court.
Is regulatory approval necessary to construct a new rail line? What is the procedure for obtaining approval?
The operation of railway tracks, train command and control systems and of train platforms requires authorisation according to article 6(1)(3) of the AEG (see question 6). In addition, the construction and alteration of railway systems in Germany requires a project planning procedure. For the federal railways the EBA is the responsible authority for conducting this procedure, which entails an examination of the technical and legal aspects of the project. The procedure is governed by article 18 of the AEG and the German Federal Administrative Procedures Act. The EBA will examine whether the project is technically feasible, whether it fulfils safety requirements, whether an environmental impact assessment is necessary, whether it affects the interests of the public or third parties, and how these can be taken account of. A project planning procedure is initiated upon submission of the application and it generally takes from one to three years. At the end of the procedure the EBA grants a formal planning permission for the project to which it can add auxiliary conditions to address any problems the project might cause in relation to its surroundings and the environment.
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?
The procedure for releasing and closing down rail infrastructure is detailed in article 11 of the AEG. Before infrastructure may be closed down, it must be checked whether any other infrastructure manager might be interested in taking it over. Responsibility for this lies with the EBA for federally owned railways, and with the railway supervisory authorities of the states for non-federally owned railways. Lines that have not been closed down must be operated as normal.
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?
Article 6g(1) of the AEG provides that if there is reasonable doubt that a company to which it has granted a business licence meets the requirements of articles 6a-6e of the AEG, the licensing authority may at any time verify that it actually complies with these requirements. The approval authority (ie, the EBA at the federal level and the authority designated by the government in each state at regional level) shall revoke the business licence if it determines that the company does not meet these requirements.
Notwithstanding the second sentence of paragraph 1, the approval authority may refrain from withdrawing the undertaking’s authorisation for non-compliance with the financial capacity requirements and set a reasonable deadline for the re-establishment of financial capacity if safety is not compromised. Sentence 1 also applies in the case of a restoration of reliability or professional suitability. The period under sentence 1, also in conjunction with sentence 2, may not exceed six months. If a set period has elapsed without the restoration being successful, the approval under paragraph 1, sentence 2 must be revoked (article 6g(3) of the AEG).
If a company has ceased operations for six months or has not commenced operations within six months of obtaining a business licence, the approval authority must verify that the company still meets the requirements of articles 6a-6e. In the case of a start-up, the company may request that the period of sentence 1 be extended taking into account the specific nature of the services to be provided (article 6g(4) of the AEG).
Article 6g(8) of the AEG states that paragraphs 1 to 7 are without prejudice to the administrative procedural rules on the annulment of administrative acts, which remain unaffected.
Article 7b(2) of the AEG provides that a certificate in accordance with section 7a may be wholly or partially amended or revoked in the event of material changes to safety regulations. Article 7b(3) of the AEG provides that a certificate in accordance with section 7a may be revoked in whole or in part, insofar as the conditions contained in it are not fulfilled or the certificate is not used in the prescribed manner. It may also be revoked in whole or in part if a certificate is not used until one year after its issue. Article 7b(4) of the AEG clarifies that the administrative procedural rules on the annulment of administrative acts remain unaffected.
An authorisation holder has the right to complain to the EBA following the withdrawal of his or her authorisation. If the holder is not satisfied with the outcome of the EBA’s investigation, he or she may pursue an action before the administrative courts in accordance with article 6g(8) and 7b(4) of the AEG. Such an action would have suspensory effect.
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?
The general insolvency rules apply to rail transport providers. Pursuant to article 6g(7) of the AEG, the approval authority must revoke the business licence of a company against which insolvency proceedings or similar proceedings have been initiated, if it is satisfied that a prospective restructuring is not to be expected within a reasonable time.
Competition law
Competition rules
Do general and sector-specific competition rules apply to rail transport?
Only general competition rules apply to rail transport.
Regulator competition responsibilities
Does the sector-specific regulator have any responsibility for enforcing competition law?
The EBA is not responsible for enforcing competition law. See questions 19 and 20 regarding the competencies of the FNA in relation to network access.
Competition assessments
What are the main standards for assessing the competitive effect of a transaction involving rail transport companies?
A transaction involving rail transport companies may be caught by the German merger control provisions, which are enforced by the Federal Cartel Office (BKartA). The current legislation can be found in Chapter VII of the Act against Restraints of Competition of 1958, version of 26 June 2013, last amended on 30 October 2017 (GWB). The GWB sets out a comprehensive list of events constituting a concentration, which includes not only the acquisition of control and the creation of joint ventures, but also the acquisition of minority shareholdings or of a material competitive influence below the level of control. A merger must be prohibited by the BKartA if it ‘would significantly impede effective competition’, in particular if it leads to the creation or strengthening of a dominant market position.
The competition rules on dominance and anticompetitive agreements may also apply to railway transport companies. Unilateral conduct by undertakings with market power is governed by articles 18, 19 and 20 of the GWB, which prohibit an undertaking’s abuse of a (single-firm or collective) dominant position, and specific types of abusive behaviour by undertakings that have ‘relative’ market power as compared to small or medium-sized enterprises (as trading partners or competitors).
The principal national rules on cartels are found in articles 1 and 2 of the GWB. These rules essentially reproduce articles 101(1) and 101(3) of the Treaty on the Functioning of the European Union (TFEU) at national level. Article 1 of the GWB prohibits all agreements between competing corporations, decisions by associations of corporations and concerted practices that have as their object or effect the prevention, restriction or distortion of competition. Article 12(7) of the AEG contains an exemption from article 1 of the GWB for certain agreements between railway undertakings, provided that they have been registered with the approval authority. Agreements restricting competition are prohibited by article 1 of the GWB only if they have an appreciable effect on competition. Agreements (and concerted practices) that fall within the scope of article 1 of the GWB are exempted from the prohibition contained therein if they meet the requirements under article 2 of the GWB. Article 2 exempts cartels from article 1 under the same standards as provided by article 101(3) of the TFEU. However, the prohibition provided for in article 101(1) of the TFEU does not apply to certain agreements and certain groups of small and medium-sized businesses, as defined in and according to Regulation (EC) No. 169/2009 applying rules of competition to transport by rail, road and inland waterway.
Price regulation
Types of regulation
Are the prices charged by rail carriers for freight transport regulated? How?
The prices charged by rail carriers for freight transport are not regulated. Article 12(1) of the AEG merely defines tariffs as consisting of the prices for carriage and the conditions of carriage. Pursuant to this provision, railway companies are obliged to cooperate in setting the tariffs for freight and passenger transport.
Are the prices charged by rail carriers for passenger transport regulated? How?
As mentioned in question 15, article 12(1) of the AEG defines tariffs as consisting of the prices for carriage and the conditions of carriage. Pursuant to this provision, railway companies are obliged to cooperate in setting the tariffs for freight and passenger transport. The railway undertakings cooperate within the Tariff Association of Federal and Non-Federal Railways.
In addition, article 12(2) of the AEG obliges public railway undertakings to set tariffs that contain all the information necessary for calculating the prices for passenger transport and to apply them in the same manner for all users. According to article 12(3) of the AEG, railway companies require prior authorisation for their conditions of carriage in rail passenger transport. However, the prices the railway undertakings set for passenger carriage do not require prior authorisation.
Is there a procedure for freight shippers or passengers to challenge price levels? Who adjudicates those challenges, and what rules apply?
See question 16. The price levels for freight shippers or passengers are not regulated.
Must rail transport companies charge similar prices to all shippers and passengers who are requesting similar service?
Article 12(2) of the AEG obliges public railway undertakings to set tariffs that contain all the information necessary for calculating the prices for passenger transport and to apply them in the same manner for all users. This excludes the possibility to justify a differential treatment on the basis of objective reasons. An infringement of these obligations can lead to an administrative fine of up to €50,000.
This obligation does not apply to freight transport.
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?
According to article 10 of the Railway Regulation Act of 29 August 2016 (ERegG), all railway infrastructure enterprises may have to grant access to their railway infrastructure. Article 68 of the ERegG authorises the FNA to issue decisions specifically prohibiting railway infrastructure enterprises from impairing the right of ‘non-discriminatory use of the railway infrastructure’. These provisions transpose the requirements of article 10 of Directive 2012/34/EU, which states that railway undertakings shall be granted, under equitable, non-discriminatory and transparent conditions, the right of access to the railway infrastructure in all member states for the purpose of operating all types of rail freight services or an international passenger service. The duty of all the subsidiaries of DB AG is to ensure non-discriminatory conditions for all the companies to use railway infrastructure and to establish objective calculation methods of charges and use of infrastructure.
Access pricing
Are the prices for granting of network access regulated? How?
The prices for granting network access are regulated at EU level through the Commission Implementing Regulation (EU) 2015/909 of 12 June 2015 on the modalities for the calculation of the cost that is directly incurred as a result of operating the train service. Charges payable by passenger and freight transport undertakings for access to tracks, stations and other facilities are regulated in the ERegG, which came into force on 2 September 2016. It contains specific requirements based on the principles of non-discrimination. The access charges for train movements on the rail network and associated services are set out in the infrastructure managers’ list of track access charges, which also provides details of the charges for any supplementary and ancillary services available in connection with the use of the tracks.
Both passenger and freight companies must negotiate with DB Netz to obtain access to DB tracks. In Germany open access rules apply to all companies that possess infrastructure, pursuant to the symmetric approach to the network access regulation. The full cost of track access is apportioned to the train operating companies. The charges for track access comprise three elements: (1) base charges dependent upon the type of track and the company’s utilisation; (2) charges linked to prioritisation in scheduling; and (3) surcharges for particular circumstances such as for heavier weights, special trains, etc.
The FNA is entitled to verify and permit access charges before they are introduced.
Competitor access
Is there a declared policy on allowing new market entrants network access or increasing competition in rail transport? What is it?
The Monopolies Commission is an independent expert committee, which advises the federal government and has statutory mandates for special reports in the field of network industries, including railway transport pursuant to section 78 of the ERegG. In its 2017 special report it concluded that competition in the German railway market is still unsatisfactory and is determined by the outstanding market position of DB AG. Its analysis of the railway sector showed that the Railway Regulation Act should be amended for the benefit of railway customers to include the financing agreement between DB AG and the government, as well as station fees. The Monopolies Commission recommended a cost-benefit analysis of railways and competing modes of transport to ensure that public funds are used where they bring the highest gains. Moreover, it suggested that DB AG should not be allowed to unilaterally refuse cooperation with its competing railway undertakings on tariffs and ticket sales to allow customers to use trains of different providers with one single ticket.
Service standards
Service delivery
Must rail transport providers serve all customers who request service? Are there exceptions or restrictions?
Pursuant to article 10 of the AEG, public rail passenger transport providers are required to carry passengers and baggage if the conditions of carriage are complied with, transport by regular means is possible, and the carriage is not prevented by circumstances that the railway undertaking cannot avert and that it could not remedy.
Are there legal or regulatory service standards that rail transport companies are required to meet?
Article 28 of Regulation (EC) No. 1371/2007 states that railway undertakings shall define service quality standards and implement a quality management system to maintain service quality. Annex III of this Regulation lists the following minimum quality service standards: information and tickets; punctuality of services, and general principles to cope with disruptions to services; cancellations of services; cleanliness of rolling stock and station facilities (air quality in carriages, hygiene of sanitary facilities, etc); customer satisfaction survey; complaint handling, refunds and compensation for non-compliance with service quality standards; and assistance provided to disabled persons and persons with reduced mobility. These rules are directly applicable in Germany.
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?
Pursuant to article 27(1) of Regulation (EC) No. 1371/2007, railway companies are obliged to set up a complaints handling mechanism, and to make their contact details and working languages widely known to passengers. In accordance with article 27(2) of Regulation 1371/2007, passengers may submit a complaint to any railway undertaking involved. Within one month, the addressee of the complaint shall either give a reasoned reply or, in justified cases, inform the passenger by what date within a period of less than three months from the date of the complaint a reply can be expected.
Passengers who are not satisfied with the response from the railway undertaking may also complain to the EBA pursuant to article 30 of Regulation 1371/2007. First, the EBA examines the facts. If the complaint is legitimate, it will conduct an administrative procedure to persuade the company to comply with its obligations in order to safeguard the passenger’s rights (eg, to pay compensation or reimbursement).
Until 2020 Regulation 1371/2007 is not applicable for certain urban, suburban and regional services, and in particular for services run mainly on account of their historical significance or for the purposes of tourism.
Safety regulation
Types of regulation
How is rail safety regulated?
Rail safety is currently regulated by the implementation of Directive 2004/49/EC, which required certain amendments to the AEG and the adoption of statutory regulations, regulations by the EBA, guidelines by the Association of German Transport Companies and DB AG, as well as DIN Standards (ie, the 27200 series of technical standards). These rules apply in Germany for regular public railways, as far as they do not operate networks of regional transport or service facilities or regional railways. The above-mentioned guidelines and DIN Standards qualify as recognised rules pursuant to article 2 of the Railway Construction and Operating Regulations (EBO), thus creating a code of practice.
Directive 2016/798/EU on railway safety, which is part of the fourth EU railway package, repeals Directive 2004/449/EC but the transposition period ends on 16 June 2019.
Competent body
What body has responsibility for regulating rail safety?
The EBA is responsible for rail safety (see question 4).
Manufacturing regulations
What safety regulations apply to the manufacture of rail equipment?
The following safety regulations apply to the manufacture of rail equipment: EBO, the Technical Principles for the Approval of Safety Systems published by the EBA, Guidelines for Driving and Building published by DB AG, and Guidelines 807 Aerodynamics/Crosswind published by DB AG. The second part (paragraphs 18-33 EBO) lays down the specifications for vehicles and modules 807.400-807.499 of Guidelines 807 include the technical requirements regarding aerodynamics and crosswind.
Maintenance rules
What rules regulate the maintenance of track and other rail infrastructure?
The maintenance of track and other rail infrastructure is regulated by a performance and financing agreement between Germany, represented by the Federal Ministry of Transport and Digital Infrastructure, railway infrastructure companies (ie, DB Network AG, DB Station & Service AG and DB Energy GmbH) and DB AG. Under this five-year agreement (2015-2019), infrastructure companies will receive around €20 billion for repairs in the existing network and also spend €100 million a year of own funds. The railway infrastructure companies also undertake to spend a total of at least €8 billion on the maintenance of railways during the contract period.
This agreement provides the railway infrastructure companies with funds for the infrastructure to use at their discretion and increases their planning security. In return, they undertake to invest in repairs in the railways at least at the agreed level, to make a minimum maintenance contribution, to contribute to the maintenance and modernisation of the existing network, and to maintain the infrastructure in a high-quality condition.
What specific rules regulate the maintenance of rail equipment?
Commission Regulation (EU) No. 445/2011 of 10 May 2011, amending Regulation (EC) No. 653/2007, establishes a system of certification of entities in charge of maintenance for freight wagons. Pursuant to article 4(1) of the AEG, owners of rolling stock are responsible for the maintenance of their rolling stock and may transfer this task to a third party responsible for maintenance.
The rules that are contained in the 27200 series of the DIN standards specify the technical requirements for safety relevant systems and components of rolling stock with standard gauge. They create a uniform safety framework for the condition of rolling stock in operation for all railway undertakings operating railway traffic on the federal rail network.
Accident investigations
What systems and procedures are in place for the investigation of rail accidents?
The Federal Railway Accident Investigation Board is the national investigation body pursuant to Directive 2016/798/EU on railway safety.
Serious accidents pursuant to article 20(1) and (2) of Directive 2016/789/EU are systematically examined in four steps: initial measures; recording the accident investigation; fact-finding; and factual analysis. The result of the investigation will be summarised and published in an investigation report.
Accident liability
Are there any special rules about the liability of rail transport companies for rail accidents, or does the ordinary liability regime apply?
Regulation (EU) No. 1371/2007 contains a provision that renders rail transport companies liable for the loss or damage resulting from the death of, personal injuries to, or any other physical or mental harm to, a passenger, caused by an accident arising out of the operation of the railway and happening while the passenger is in, entering or alighting from railway vehicles regardless of the railway infrastructure used. It also stipulates the circumstances in which it is relieved from liability in this context.
The Liability Act of 4 January 1978, last amended on 17 July 2017, creates special rules for the liability of rail transport companies for rail accidents. It establishes a strict liability regime.
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)?
Federal states are responsible for procuring subsidised regional passenger rail services from rail companies, and for financing them within franchise contracts. The franchising system is based on transfer from the federal budget to the federal states at an annual level of approximately €8 billion with an agreed increase of 1.8 per cent per annum. See question 28 regarding the agreement on services and financing. The federal government also gives grants annually for noise abatement measures.
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?
Regulation (EU) No. 1370/2007 defines the conditions in which the competent authorities can intervene in the area of public passenger transport (rail and road transport) to guarantee the provision of services of general interest. It applies to regular and non-discriminatory access, and national and international public passenger transport services by, inter alia, rail.
The competent authority, meaning the public authority or authorities with the power to intervene in public passenger transport within a given geographical area, is obliged to conclude a public service contract with the operator to which it grants an exclusive right or compensation in exchange for discharging public service obligations. Obligations that aim to establish maximum tariffs for all or certain categories of passengers may also be subject to general rules.
The competent authority, defined in article 15 of the AEG, grants compensation for the net financial impact occasioned by compliance with the contractually defined public service obligations or pricing obligations established in the general rules. Public service contracts are awarded according to the rules laid down in this Regulation. Subject to certain reservations detailed in article 5 of the Regulation, competent local authorities may provide public transport services themselves or assign them to an internal operator over which they have control comparable to that over their own services. Any competent authority who uses a third party other than an internal operator must award public service contracts by means of transparent and non-discriminatory competitive procedures that may be subject to negotiation. The obligation to instigate competitive procedures does not apply to rail transport.
Granting financial support by the state to private undertakings falls under EU state aid rules. The Commission has issued guidelines on the application of state aid rules for railway companies. These guidelines apply to railway companies as well as to urban, suburban or regional passenger transport companies with regard to aid for the purchase and renewal of rolling stock. They cover support by means of infrastructure funding; aid for the purchase and renewal of rolling stock; debt cancellation by states with a view to the financial restructuring of railway undertakings; aid for restructuring railway undertakings; aid for coordination of transport; and state guarantees for railway companies. The rules applicable to state aid in the form of guarantees for railway companies are also set out in the Commission notice on the application of articles 87 and 88 of the EC Treaty.
A €500 million package of state aid from the federal government, which is part of a scheme running from 2018 to 2022 approved by the European Commission, is available to railway companies. It aims to promote the adoption of new energy-efficient technologies in the sector.
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?
Article 25 of the AEG states that public railways alone decide when jobs need to be filled to provide railway services and to maintain and operate the railway infrastructure according to business needs. The co-determination right of the works council pursuant to article 87(1)(2) of the Works Constitution Act with regard to the working time regulations for the employment of the employees during the occupation times specified in sentence 1 remains unaffected.
Germany has adopted a series of laws regarding the protection, working hours and salary, training, qualifications, education and career progression of workers in the rail transport industry.
Environmental regulation
Applicable environmental laws
Are there specialised environmental laws that apply to rail transport companies, or do standard environmental laws apply?
According to the AEG, the EBA is responsible, inter alia, for environmental supervision, in particular with regard to the approval and monitoring of facilities of the federal railways. In this context, the legal framework within which the EBA operates is the Federal Emission Control Act, the Federal Soil Protection Act, the Water Resources Act, the Plant Protection Act and the regulations based on these Acts.
Railway rolling stock is required to meet certain noise emission limits. This obligation, applicable only to newly built wagons, was introduced under the Railway Interoperability Directive through Commission Regulation (EU) No. 1304/2014 on the technical specification for interoperability relating to the subsystem ‘rolling stock - noise’.
Update and trends
Update and trends
Are there any emerging trends or hot topics in your jurisdiction?
As part of the fourth EU railway package, Directive 2016/797/EU on the interoperability of the European Union’s rail system was adopted. It aims to facilitate, improve and develop rail transport services within the EU and with non-EU countries, thereby contributing to the completion of the single European railway area and to the shift to more efficient types of transport. EU countries must incorporate it into national law by 16 June 2019 but Germany has not taken any measures as of the date of writing.
