Estonian regulator proposes opening bus services market to competition (1)

Simple Express bus taking on passengers at Tallinn Bus Station. (Toomas Tatar/Postimees/Scanpix)
11/23/2016 11:35 AM
Source: BNS
Category: Business

The Estonian Competition Authority (ECA) has made a proposal to open the market for intercity bus services to competition by lifting the restrictions applied to the issuance of line permits, arguing that there is no clearly justifiable need for them.

The restrictions concerning the issuance of line permits are worded vaguely in the Public Transport Act and more detailed furnishing of the restrictions has been left for the National Road Administration to decide, the competition authority said, according to whom businesses operate intercity bus routes on market terms and the state should not restrict the opening of new services. The state should impose uniform requirements for all carriers instead of always demanding better or at least equal terms from new carriers.

The ECA found that the currently valid arrangement puts new and existing carriers in an unequal situation in competition, preferring existing carriers. It maintains that both existing and new carriers must be able to enter the market and operate there on the same conditions.

According to the ECA, the Tallinn-Tartu and Tallinn-Narva services are a telling example of this, with a single carrier commanding a market share in excess of 70 percent on both routes. It says that free competition would result in equal treatment of carriers and lower fares for the consumer as well.

The ECA proposed similar moves in both 2010 and 2012 already.

Editor: Aili Vahtla

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