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Focus on France as Commission approves EWS takeover

25 Nov 2007

CONDITIONAL APPROVAL for Deutsche Bahn to acquire 100% of EWS Holdings was announced by the European Commission on November 7.

Welcoming the decision, EWS said 'both companies look forward to working together to develop freight in Europe', stressing that 'the business strategy of EWS remains the same: to continue growing rail freight services through its operations in Britain and through Euro Cargo Rail in France' (RG 11.07 p691). ECR is currently launching operations in Spain, and plans to expand eastwards across Europe.

The Commission had expressed concerns 'that the proposed transaction, as initially notified, would result in France in a possible weakening of the competitive constraint exercised by EWS', given that 'DB may not have the same incentives to pursue the rail freight transport business in France'. However, 'DB has committed to fulfil EWS's expansion plans in the next five years through investment in key assets (locomotives) and personnel as set out in the EWS Business Plan and to deploy these in France'. The requirement for motive power has already been met through an order for 60 Class 66 locos from EMD specifically for use by ECR. The first three arrived at Rotterdam in November, and the rest should be delivered during 2008.

ECR has also committed to 'provide fair and non-discriminatory access to EWS driver training schools and maintenance facilities in France for all third-party rail operators (except SNCF, the French incumbent) thereby lowering these potential barriers to entry and expansion for companies wishing to enter the French rail freight market'.

Meanwhile, Fret SNCF announced on November 12 that it had signed a 'Service Level Agreement' with Infrabel in a bid to improve the quality and performance of its services in Belgium, particularly for trains to and from the port of Antwerpen.