Published: December 15 2023
The public service contracts for MÁV-Start and GYSEV, the state-operated railways in Hungary, are set to expire on December 23rd. If these contracts are not extended, it opens up opportunities for private companies to operate railways in the country. This could lead to higher service standards, rolling stock replacement, and improved branch lines.
Privatisation of Railway Line Operations
According to EU Regulation 1370/2007, public service contracts for railway line operations can be extended without a call for tenders until December 23rd, for a maximum of ten years. After this date, a public tender must be launched, giving private operators the opportunity to bid for the contracts. This would allow the state to remain the customer, financier, and organizer of the rail service.
Success in Western Europe
Several countries in Western Europe have seen private operators take over railway routes in recent years. France, which has traditionally had a strong state-owned railway company, saw private operators provide cheaper offers for running lines. Similar situations occurred in the Czech Republic and Slovakia, where private operators took over various services.
Budapest Suburban Railways Development
The development of suburban railways in Budapest is expected to result in better-integrated and faster services. This improvement in the rail network will likely benefit both public and private operators, further enhancing the potential for private railways in Hungary.
As the contracts for state-operated railways in Hungary approach expiration, the possibility of private companies operating railways in the country emerges. This privatisation could bring better service standards, solve rolling stock replacement issues, and improve branch lines. Evidence from other countries highlights the potential benefits of private operators, including cheaper offers for running lines. The development of suburban railways in Budapest further reinforces the possibility of private railways playing a significant role in Hungary's rail network.
Questions & Answers
What is the current status of railway operations in Hungary? The public service contracts of MÁV-Start and GYSEV, the state-operated railway companies, are set to expire on 23 December, which opens up the possibility for private companies to operate railways in Hungary.
What could be the benefits of privatizing railway operations in Hungary? Privatizing railway line operations in Hungary could lead to higher service standards, solve the issue of rolling stock replacement, and improve branch lines.
What does EU Regulation 1370/2007 state regarding public service contracts for railway operations? According to the regulation, public service contracts for the operation of railway lines in each member state can be extended without a call for tenders until 23 December for a maximum of ten years. After this date, a public tender must be launched, open to private operators.
If open tenders are launched for railway operations in Hungary, what role would the state play? If open tenders are launched, the state would remain the customer, financier, and organizer of the rail service, while private operators would handle the operation of the lines.
Is privatization of railways a common practice in Europe? Yes, several countries in Western Europe have recently seen private operators take over railway routes. In countries like France, where the state-owned railway company (SNCF) has traditionally been prominent, private operators have started to provide services. Similar situations have occurred in the Czech Republic and Slovakia, where private sector companies have taken over certain services. These examples show that private operators often offer cheaper options for running railway lines compared to public railways.