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The National Markets and Competition Commission (CNMC) has proposed that the government liberalize the bus transport sector for journeys longer than 100 kilometers and scrap the current concession system, which has led to monopoly and patronage practices. The organization estimates that Spain should follow the example of countries like Germany, France and Italy or Germany, where the liberalization of intercity bus services a decade ago has resulted in a price drop of between 23% and 36% and a 20% increase for lines and Passengers that have increased ninefold in Germany and have grown by 82% and 36% in the other two countries respectively.

The proposal comes at a time when the European Commission has just approved a project to liberalize more than 100 kilometers of national routes, already approved by the European Parliament and awaiting approval by the Council of the EU. However, it does not seem that this will be the solution of the government, which in the plans of the Ministry of Transport, Mobility and Urbanism continues to bet on the concession model, in which a single company will exclusively operate the lines of the bus. The ministry is preparing a new concession map that will reduce the number of contracts from 77 to 22 and intends to award them in 2024. The concessions are granted by the state when the routes cover more than one autonomous community, and they are awarded by the regional governments, albeit only for your municipality.

The sector, which moved €2,300 million in business in 2021, is heavily concentrated around three large companies – Alsa, Avanza and Arriva – which account for more than a third of the market. None of them are in Spanish hands. The Alsa group is owned by British giant National Express; Avanza is owned by British venture capital fund Doughty Hanson, and Arriva is a subsidiary of Deutsche Bahn. The two main employers in the sector have different opinions on the possible liberalization. While the Spanish Confederation of Bus Transport (Confebús) backs the concession model, the National Confederation of Bus Transport Employers (Anetra) defends the switch to liberalisation.

expired concessions

The CNMC also denounces that the concession system has serious operational flaws, the most serious of which is the practice of extending concessions that creates a patronage system. Thus, at the end of 2019, 52% of the analyzed Spanish concessions (state and regional) had expired and the average duration of the operating concessions in 2019 exceeded the legal maximum of ten years and in some municipalities even 30 years on average. When bidding, there are advantages for first-time concessionaires over other bidders (e.g., they have better information about the viability of routes), there are many court conflicts, and the terms of bidding specifications limit competition in bidding, according to the CNMC report.

To avoid these practices, the CNMC proposes the above-mentioned liberalization of the longest routes and the establishment of an independent regulator to oversee the liberalization process and resolve potential conflicts. And with regard to the non-liberalised routes, it requires that the expired concessions be put out to tender, that expired concessions be liberalized two years after their expiry if no new tender has been made, and that extensions are resorted to only in exceptional situations.

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Source elpais.com

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