The Commission sends Statement of Objections to Czech rail incumbent for alleged predatory pricing

The European Commission has informed the state-owned Czech rail incumbent České dráhy (ČD) of its preliminary view that ČD has breached EU antitrust rules by charging prices below costs.

Executive Vice-President Margrethe Vestager, in charge of competition policy, said: “Competition in the rail passenger transport sector can drive prices down and service quality up to the benefit of consumers. It benefits the environment too as travelers shift to rail in line with the Green Deal objectives. In the present case, we have concerns that České dráhy was involved in predatory pricing which is against the EU competition rules.”

Following a complaint, the Commission carried out inspections at the premises of ČD in April 2016. In November 2016, the Commission opened a formal antitrust investigation to assess the alleged predatory conduct of ČD relating to the provision of rail passenger transport services in Czechia, and in particular on the Prague – Ostrava route, the backbone of the Czech rail network.

On certain routes in Czechia, rail undertakings compete on a commercial basis, outside of public service contracts. In 2011 and 2012, two new rail undertakings, RegioJet and Leo Express, started operating commercial trains on the Prague-Ostrava route. As competition increased in the rail sector in this area, the number of passengers using this route by rail doubled in a few years.