How to increase railways competitiveness

- CITs`perspective -

Working Party on Rail Transport, 25 November 2014

Cesare Brand, Secretary General, CIT

Ref. E337

The CIT and its members

• 200 railway undertakings and maritime companies

• Association under Swiss law located in Bern

Main Tasks:

1. Practical implementation of COTIF and European transport law.

2. Standardization of contractual relationships

3. Representation of members’ interests towards authorities andother associations

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Success key for railways

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Good Quality of infrastructure

Technical interoperability (vehicle authorisation and safety certification)

Level playing field with other transport

modes

Competetive and planable charge for use of infrastructure

Less administrative burdens: New regulatory requirements when customers benefit

Stable and fair legal framework

Chita

Urumqui

Shanghai

Hong Kong

Teheran

Mumbai

Reykjavik

Istanbul

Ulan Ude

Xiangtang

Ulan Bator

Pardubice

Shenzhen

Moscow

WienKars

Baku

T’Bilisi

Astana

Beijing

Zabaikalsk

Almaty

Novosibirsk

Chongqing

Duisburg

Warschau

Xi’an

Lanzhou

Ekateringburg

Lianyungang

Opportunities & challenges for railway companies today: Eurasian Freight Corridors - An existing market with potential

Freight traffic China-Europe~90% Sea/40 days<10% Air/1 day ~1% Railway/ ~15 days~ 70 freight trains per week

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Opportunities & challenges for railway companies today: Different legal regimes - a challenge for operators

SMGS/SMPSSMGS/SMPSEC LawEC Law

COTIFCOTIF

corridor corridor regulationregulation

National National

lawlawLegal interoperabilityLegal interoperability

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Legal duality for rail transport as an obstacle to competitiveness

CIM (Uniform Rules concerning the Contract of International Carriage of Goods by Rail - Appendix B to COTIF)

•Annex to the main convention

•Consensual contract

•Contractual freedom

•Consignment note design within the competence of RUs

•Joint and several liability

SMGS (Agreement on International Goods Transport by Rail)

•Main convention

•Formal contract

•Obligation to set and publish tariffs and to carry

•Consignment note defined in SMGS itself

•Individual liability

Administrative costs

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Why is legal interoperability important for the business and competitiveness?

Country A

Transport contract

LiabiIity

Transport documents / consignment note

Tickets

Claims

Country B

Transport contract

Liability

Transport documents / consignment note

Tickets

Claims

A One legal regime B - 10% administrative costs

Legal certainty, less legal costs

Optimisation of business operation 7

Solutions to increase railway competitiveness: the CIM/SMGS consignment note

Success of the CIM/SMGS consignment note as good basis for further works on contractual level:

• Statistics

CIM/SMGS consignment note used in 70-80% of the total CIM/SMGS traffic – 20-30% increase

• Facts Explicit reference to the CIM/SMGS consignment note in Annex 9 to

the UNECE Agreement 1982 Explicit reference to the CIM/SMGS consignment note as a transit

customs document in the Customs Code of the RBK CU• Actions Inclusion of the three traffic axes from and to China: Alshankou –

Dostyk (China and Kazakhstan); Erljan – Zaminuud (China and Mongolia); Manzuli – Zabaikalsk (China and Russia)

Integration of the Baltic ports into Trans-Siberian Rail Corridor (e.g. Ust-Luga, Riga Port, Sassnitz und Baltic Port Rail Mukran)

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General Terms and Conditions for EurAsia Rail Transport Contracts of the CIT

(GTC EurAsia)

Point 3 - of the UNECE Political DeclarationFramework contract - for participating railways (on different corridors)Applicable law - mandatory provisions of the national law shall applyPrecondition – opting-in through the participating railways (for example DB, PKP Cargo, BC, RZD and CCTT or GETO)Legal basis - international private law (IPR)

Solutions to increase railway competitiveness: GTC Eurasia as instrument on contractual level

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Solutions to increase railway competitiveness: UNECE Joint Declaration

Joint Declaration on the promotion of Euro-Asian Rail Transport and activities towards Unified Railway Law (26 February 2013, Geneva)

• Important step torwards a solution to unify different legal regimes

• State of play: Draft of relevant legal provisions to be included into a new international legal railway regime for transmission to the forthcoming session of the Inland Transport Committee (24–26 February 2015).

• CIT strongly invites the states and stakeholders to coordinate their work for consistent legal layers - For the benefit of a performant transport logistic and the competitiveness of the railway transportation.

Unified Rail Transport LawUnified Rail Transport Law

COTIF/CIMCOTIF/CIM SMGSSMGS

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Conclusions

• CIM/SMGS consignment note• Standardised CIM/SMGS claims handling

procedure• General Terms and Conditions EurAsia• Unified Rail Transport Law

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Thank you for your attention!

For further information, visit www.cit-rail.org

Cesare Brand

Secretary General CIT

Tel: +41 31 350 01 90

Email: cesare.brand@cit-rail.org

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