Czech railways violate EU antimonopoly laws

The European Commission (EC) has tentatively concluded that Czech Railways (ČD) is violating antitrust rules by charging prices below cost. Therefore the commission sent its objections to the carrier, as railway magazine «Railway Supply» informs referring  Сeske Noviny

railways
Picture: www.cd.cz

If ČD fails to protect its interest in the competition, it faces a fine of up to ten percent of its annual turnover. According to the company’s annual report, last year this would have meant about four billion kroons. In response, the carrier stated that the objection is not a decision that mandatorily states that ČD is obliged to pay a fine.

The commission opened an investigation in 2016 when RegioJet and Leo Express filed a price complaint. In 2011 and 2012, they began offering their services on the main line between Prague and Ostrava, where then Czech Railways reduced ticket prices below cost levels.

According to European Commission Vice President Margrethe Vestager, competition in the transport sector can lower prices and improve service quality, which can benefit customers. “However, in this case, we are concerned that Czech Railways are setting predatory prices, which is contrary to EU competition rules,” Vestagerova said today.

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