Liberalisation of The Hungarian Rail Industry

LIBERALISATION OF THE HUNGARIAN RAIL INDUSTRY

ANTAL, Dániel p r e s i d e n t

H a l l e, 26th September 2007.

Hungarian Rail Office 2007

Hungary: railway networks

Railway network density 2006, km/1000 km2


0,00

20,00

40,00

60,00

80,00

100,00

120,00

140,00

Norway

Finlan

d

Greec

e

Estonia

Sweden

Lithu

ania

Irelan

d

Spain

Portu

gal

Latvi

a

Bulgar

ia

Roman

ia

Denm

ark

Franc

eIta

ly

Poland

Sloven

ia UK

Nethe

rland

s

Austri

a

Slovak

ia

Switzer

land

Hunga

ry

Luxe

mbo

urg

Germ

any

Belgium

Czech

Rep

.

Source: European Commission, UIC

Weighted average

Electrified lines 2006, % of total network


0,00

20,00

40,00

60,00

80,00

100,00

120,00

Irelan

d

Greec

e

Lithu

ania

Estonia

Latvi

a

Denm

ark

Czech

Rep

.UK

Hunga

ry

Roman

ia

Sloven

ia

Slovak

ia

Finlan

d

Franc

e

Portu

gal

Spain

Germ

any

Poland

Austri

a

Norway

Bulgar

iaIta

ly

Nethe

rland

s

Sweden

Belgium

Luxe

mbo

urg

Switzer

land

Source: Eurostat, UIC

Weighted average

Double track lines 2006, % of total network


0,00

10,00

20,00

30,00

40,00

50,00

60,00

70,00

80,00

90,00

Norway

Finlan

d

Latvi

a

Estonia

Hunga

ry

Sweden

Czech

Rep

.

Greec

e

Portu

gal

Lithu

ania

Bulgar

ia

Irelan

d

Sloven

ia

Roman

ia

Slovak

ia

Spain

Austri

a

Denm

ark

Italy

Poland

Luxe

mbo

urg

Germ

any

Franc

e

Switzer

land

Nethe

rland

sUK

Belgium

Source: Eurostat, UIC

Weighted average

Modal split in freight transport EU-27, 2005.


With longer transport distances and lower population densities, railways are more competitive in Central- and Eastern European countries. The downside is the lower cost-efficiency pressure.

The Czech Republic, Finland, Hungary and Slovenia has more favourable modal split than other EU countries.

Austria, Estonia, Latvia, Lithuania, Poland, Romania, Slovakia, Sweden have even higher shares of the rail mode.

Hungary: relatively high rail market share in the intermodal competition, access to more rail-dependent economies such as Romania, the Ukraine.

Staff per network kilometre, 2005.


0,00

2,00

4,00

6,00

8,00

10,00

12,00

Sweden

Norway

Finlan

dUK

Spain

Irelan

d

Portu

gal

Greec

e

Estonia

Denm

ark

Franc

e

Hunga

ryIta

ly

Latvi

a

Roman

ia

Lithu

ania

Poland

Germ

any

Sloven

ia

Czech

Rep

.

Bulgar

ia

Austri

a

Switzer

land

Nethe

rland

s

Slovak

Rep

.

Belgium

Luxe

mbo

urg

Source: UIC

Weighted average

Rail network access charges EU-27, 2005.


EU15, Romania, Bulgaria, the Czech Republic and Slovenia offers lower access charges.

Poland, Slovakia, Latvia offer higher access charges.

Hungary, Lithuania, Estonia offers similar access charges.

New members state generally do not give state aid for the maintenance of the rail infrastructure, but offer access to fast growing transport markets. The infrastructure managers in these countries also have low efficiency.

Hungary: competitive access prices to/from Ukraine, Romania and Southern Eastern Europe.

Rail network access charges EU-27, 2005.


Estonia, Latvia, Lithuania: wide gauge, higher access fees, higher traffic density.

Poland, Slovakia: higher access fees, higher traffic density.

Portugal, Denmark: lower access fees, lower traffic density.

Other EU: lower access charges, lower traffic density.

Hungary: competitive access prices to/from Ukraine, Romania, Serbia and Southern Eastern Europe.

New initiatives to facilitate border crossing to/from Croatia, Serbia.


Hungary: rail freight markets

Rail freight transport in million ton-kms, 2006.


0

20000

40000

60000

80000

100000

120000

Irelan

d

Luxe

mbo

urg

Greec

e

Denm

ark (

2005

)

Portu

gal

Norway

Sloven

ia

Nethe

rland

s (20

05)

Bulgar

ia

Belgium

Hunga

ry

Slovak

ia

Estonia

Spain

Finlan

d

Lithu

ania

Roman

ia

Latvi

a

Switzer

land

Czech

Rep

ublic

Austri

aIta

ly

Sweden

(200

5)

United

King

dom

Franc

e

Poland

Germ

any


Weighted average

1000 ton-kms per network-km, 2006.


0

2 000

4 000

6 000

8 000

10 000

12 000

Irelan

d

Greec

e

Slovak

ia

Norway

Portu

gal

Denm

ark (

2005

)

Sloven

ia

Luxe

mbo

urg

Hunga

ryIta

ly

Bulgar

ia

Roman

ia

United

King

dom

Franc

e

Czech

Rep

ublic

Nethe

rland

s (20

05)

Finlan

d

Poland

Sweden

(200

5)

Belgium

Germ

any

Austri

a

Switzer

land

Latvi

a

Lithu

ania

Spain

Estonia


Weighted average

Herfindahl-Hirschmann Index in Hungary, 2005-2007.


0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

2005 2006 N1 2006 N2 2006 N3 2006 N4 2007 N1 2007 N2

Herfindahl-Hirschmann Index accounted by sale

Herfindahl-Hirschmann Index accounted by ton kilometers

Modal split in freight transport, EU-27, 2005.


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Cypru

sM

alta

Irelan

d

Greec

e

Nethe

rland

s

Luxe

mbu

rgSpa

in

Portu

gal

Denm

ark

Italy

United

King

dom

Belgium

Franc

e

Germ

any

Roman

ia

Sloven

ia

Finlan

d

Hunga

ry

Bulgar

ia

Czech

Rep

ublic

Slovak

ia

Poland

Austri

a

Sweden

Lithu

ania

Estonia

Latvi

a


Railways Roads Inland waterways


Hungary: passenger markets

Passengers per population, 2005.


0,00

5,00

10,00

15,00

20,00

25,00

30,00

35,00

Greec

eSpa

in

Lithu

ania

Estonia

Sweden

Roman

ia

Bulgar

ia

Poland

Sloven

ia

Slovak

iaIta

ly

Irelan

d

Norway

Latvi

a

Hunga

ry

Finlan

d

Portu

gal

Franc

e

Czech

Rep

ublic

United

King

dom

Belgium

Nethe

rland

s

Germ

any

Luxe

mbo

urg

Austri

a

Switzer

land

Denm

ark

Source: Eurostat. UIC

Weighted average

Million passenger-kilometres in 2006.


0

10000

20000

30000

40000

50000

60000

70000

80000

90000

Luxe

mbo

urg

Estonia

Lithu

ania

Sloven

ia

Latvi

a

Greec

e

Irelan

d

Slovak

ia

Bulgar

ia

Norway

Portu

gal

Finlan

d

Sweden

Denm

ark

Czech

Rep

ublic

Hunga

ry

Roman

ia

Austri

a

Belgium

Switzer

land

Nethe

rland

s

Poland

Spain

United

King

dom

Italy

Germ

any

Franc

e

Source: UIC

Weighted average

Change in passenger-kilometre (%, 2001-2006)


Pol

and Norw

ay

Germ

any

Spa

in

Gre

ece

Neth

erla

nds

Slo

veni

a

Unite

d K

ingdo

m

Latv

ia

Est

oni

a

Sw

eden

Denm

ark

Aus

tria

Sw

itzer

land

Hung

ary

Por

tugal

Cze

ch R

epub

lic Italy

Fin

land

Fra

nce B

elgiu

m

Irel

and

Lith

uani

a

Rom

ani

a Bul

gar

ia

Slo

vaki

a

Luxe

mbou

rg

-50

-40

-30

-20

-10

0

10

20

30

40

50

Source: UIC


Hungary: institutions

Rail Liberalisation Index, 2004.


Rail Liberalisation Index, 2004.


• Government Decree 2185/2005 (IX.9.) on strategic issues of the railways, setting out aims for restructuring MÁV Hungarian State Railways, unbundling by 1 January 2007.

• Act on Rail Transport, in effect since 1 January 2006.

• Capacity-allocation body as allocation body and charging body, Network Statements www.vpe.hu

•Hungarian Rail Office established on 1 January 2006 as regulatory body and licensing authority.

• MÁV Cargo (freight subsidiary) was established as a rail undertaking on time and it is being privatized. MÁV Start (passenger subsidiary) was established as a company with delay and it is not completely unbundled from MÁV.

• MÁV is still a vertically integrated company, GySEV/Raaberbahn will remain a vertically integrated company in Western-Hungary and Burgenland.

http://www.vpe.hu/

Licensed RUs in Hungary


Number or licenses issued 2005-12-31 2006-12-31 2007-09-25

Freight transport (EEA relevant) 7 11 13

Freight transport (regional) 0 0 3

Passenger transport (EEA relevant) 2 2 3

Passenger transport (regional) 20 20 15

CER members: MÁV, MÁV Cargo, GySEV, VPE, CER and MAVE (pro-rail industrial lobby group)

ERFA members: currently none.

EIM members: currently none.

Scope of authority, decisions, clients


The Hungarian Rail Office

Scope of authority

Established on 1 January 2006 without legal predecessor as an institution.

Licensing authority: In Hungary all freight, passenger and infrastructure services have to be licensed. The Hungarian Rail Office is a licensing authority under the scope of Council Directive 95/18/EC and is a successor of previous licensing authorities. Similar national licensing scheme for regional, suburban, local and private railways, and for the two national infrastructure managers, MÁV Zrt and GySEV Zrt (Raaberbahn).

Regulatory body: The Hungarian Rail Office is the regulatory body under the scope of Directives 91/440 EEC and 2001/14/EC. No predecessor in this authority, cannot take on cases before 2006.

Passenger rights: The Hungarian Rail Office approves the general terms of agreement for all rail passenger carriers in Hungary. A new Passenger Rights Ombudsman was appointed on 31 August 2007. HRO will be responsible for the implementation of the forthcoming Community legislation. The current tasks are stipulated by national railway law.

Other tasks: Oversight of accounting separation, some regulation on the freight market, some tasks related to state aid in the railways sector. Tasks stipulated by national railway law.

Safety certificate have to be approved by the National Transport Authority, which is responsible for safety regulation in all transport segments.


Decisions of the Hungarian Rail Office

Decisions: The decisions of the Hungarian Rail Office are based on its procedures. The decision is always taken by the president in one person. The president may delegate decisions to the vice-president or the head of units by types of case or on a case-by-case basis. No such delegation exists: the vice president makes decisions if legal deadlines would be risked by an unforeseen emergency. The president may appoint a Council of Advisors who may form an opinion on decisions. The Council will be appointed by 2008.

Transparency & client rights: The procedures of HRO are regulated by Act CXL 2004 on general rules of public administrative procedures and services with few modifications. The procedures are public for the interested parties. All the decisions of HRO, and with very few limitations the full text of the legally binding justification (the legal facts, other facts which are not confidential, the full interpretation of the facts) is published on www.vasutihivatal.gov.hu. Procedures: http://www.magyarorszag.hu/english/keyevents/a_kozig/a_foglalk/a_alligazelj20051026

Independence from political decisions: The minister of economy and transport is the supervisor of the institutions (general budgetary and procedural issues). The Act on Rail Transport prohibits the minister to overrule the decisions of HRO which are subject only to judiciary oversight. The minister on the other hand cannot make decisions for HRO, which rules out any influence on the decision-making process.

Judiciary oversight: The decisions of HRO cannot be modified by any body of the Hungarian government. The decisions are immediately binding and are subject to two-tier judiciary oversight. During such a process the judiciary may temporarily suspend the decisions.


http://www.vasutihivatal.gov.hu/

http://www.magyarorszag.hu/english/keyevents/a_kozig/a_foglalk/a_alligazelj20051026

Decisions of the Hungarian Rail Office

Total no. decisions in 2007 (2006)116 (26) including procedural and other

EEA relevant licences decisionsFreight +8,-2 (+3)

http://vasutihivatal.gov.hu/vasut_tarsasagok/arutovabbitasPassenger +3 (0)

http://vasutihivatal.gov.hu/vasut_tarsasagok/szemelyszallitas

National licence decisionsInfrastructure +1 (0)Private infrastructure 29 (0)

http://vasutihivatal.gov.hu/palyahalozatokRegional railway +16 (0)Suburban railway 0 (0)

Regulatory decisionsCapacity-allocation 1 (1)Terms & pricing 2 (1)Business conduct 2 (0)

http://vasutihivatal.gov.hu/hivatal/ugyintezes/piacfelugyelet

Fines imposedMÁV Zrt: 50 million HUF VPE Kft (CAB) 5 million HUF



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