1. The Executive commissioned Steer Davies Gleave to provide research and advice on risk management in relation to the support of lifeline ferry services which fall within the scope of the Maritime Cabotage Regulation. The research comprised the provision of a factual report on the different approaches adopted in EU countries to support lifeline island ferry services; a similar report on 3 non- EU countries (Norway, Canada and Japan), and a third report summarising the risks identified and different approaches to managing those risks. These reports have been published on the Executive website at ( www.scotland.gov.uk ).
2. It should be noted that the following Member States were excluded from the study because they are landlocked and could not, therefore, have any services which fall within the scope of the Maritime Cabotage Regulation:
3. Steer Davies Gleave also confirmed that there are no publicly subsidised island ferry services in the following Member States:
4. The SDG research focused on the remaining 14 EU Member States:
5. The reports cover a range of issues. However, of particular relevance to the Executive's consideration of the requirement to tender the Clyde and Hebrides ferry services, it was noted that all other EU Member States were either already in compliance with the Maritime Cabotage Regulation, were in the process of becoming so or were in discussions with the European Commission about how to become so. Table 1 provides a summary of the current arrangements in each Member State and an indication of which of these categories the Member State falls into.
Member State | Summary of Lifeline Ferry Provision | Provision of lifeline ferry services in line with EU rules on Maritime Cabotage? | What steps are being taken to bring lifeline ferry services into compliance with EU rules? |
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Denmark | 24 routes to 26 islands receive public subsidies and are regarded as lifeline services. The organisation of ferry services is complex and fragmented and the tendering and contracting of PSO/ PSC services is carried out at local, regional, or state level. Some of the small island lines and cross-river traffic are operated by the local governments in-house. | Partly. All subsidised routes have been tendered. However, the EU notified the Danish Government in July 1998 that their legislation for ferries and the option to give exclusivity on certain routes for operators was against EU legislation. Other changes which have been made to bring the Danish ferry services into compliance include a legal requirement that all subsidised ferry services must be tendered and that the tender must be advertised in the Official Journal of the European Union. | The Commission notified the Danish Government in July 1998 that their legislation for ferries and the option to give exclusivity on certain routes for operators was against EU legislation. As a result new legislation was brought into force in June 1999. However, the new legislation is still not in compliance with the EU regulations and the Danish government is working with the Commission to resolve the issues. |
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Estonia | 4 ferry services are provided under a Public Service Contract with a single operator. | SDG were unable to contact anyone in the Estonian government. The information is, therefore, not sufficiently complete to indicate whether or not the services are in compliance. | The services are being tendered with a view to having a new contract in place in 2005. |
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Finland | The Finnish Maritime Authority provides services between the Finnish mainland and islands, and local authorities provide inter island services. | No. | The Finnish authorities are preparing to move to open tender for all island ferry services in Finland. It is expected that the process will take at least three years. |
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France (Corsica) | France supports domestic ferry services to Corsica and along the Atlantic Coast. Steer Davies Gleave focused, in their report, on the arrangements in Corsica. In relation to Corsica, ferry services are supported in 2 ways: - Open routes (Corsica-Nice, Corsica-Toulon). Operators receive subsidy, based on numbers of passengers carried, as long as they meet certain light obligations and agree to a convention with the relevant authorities. - Closed routes (Corsica-Marseille). This service is operated under a contract with a single operator. | Yes. All Public Service Contract arrangements are awarded after an EU compliant tender procedure. The arrangements for open routes are also compliant with the Maritime Cabotage Regulation. | N/A |
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Germany | Ferry services are regulated by state governments (laender). Where relevant there is an obligation on laender to secure a year round ferry service to islands. However, the market currently provides sufficient services and there are, currently, no lifeline ferry services requiring government support. It should be noted that until 1997, operators in Lower Saxony and Schleswig Holstein had exclusive contracts to operate ferry routes. Under these contracts, operators agreed to provide year-round services. In order to comply with EU rules, the government of Lower Saxony abolished the exclusive contracts. Operators that provide year-round services, however, benefit from a discount on port duties. This benefit is available to any operator. | N/A | N/A |
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Greece | Each January operators are invited to submit applications to operate commercial island services from the following November for a year. Those routes which do not receive any applications (currently around 70) are deemed to be lifeline services and the government tenders public service contracts for those routes. | Yes. Greece was granted a derogation from Council Regulation EEEC 3577/92 until 2004. In 2000 the government took steps to liberalise the market including the reform of the arrangements for PSOs and PSCs. | N/A |
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Ireland | There are PSCs on 14 routes. All are operated by private domestic shipping companies. None of the Irish islands generate more than 100,000 trips in a year, and the routes would, therefore, be eligible for the 'simple call for expressions of interest' referred to in the December 2003 guidance. However, the Irish government chose, instead, to run a full tender process to ensure a transparent, competitive and fair bidding processes for the subsidised contracts. | Yes. | N/A |
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Italy (Sicily) | The only subsidised services are the 4 routes which link Sicily to the surrounding islands under its competency. Open competitions were held for fast passenger services and freight/dangerous goods services. Slow ferry services are currently provided under contract by a part state owned company. However, the contract is due to expire in 2005 and will be re-let via an open competition. | Partly. | Slow ferry services will be tendered in 2005. |
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Malta | Lifeline services between Malta and Gozo are provided by Gozo Channel Shipping Line (a wholly owned subsidiary of Malta Government Investments Limited) under a Public Service Obligation Contract. | No. The current PSO contract, the first one since Malta's accession to the European Union, was not tendered. This arrangement was agreed with the Commission as part of Malta's accession arrangements. | Malta has committed to tendering the Gozo Channel service by 2010. |
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The Netherlands | 5 services to and from the Wadden islands in the north of the country are considered to be life-line services. The operators receive no direct subsidy but do benefit from free use of port facilities, and maintenance of the navigation channels in the Waddenzee. 2 of the services also benefit from an exclusive arrangement in return for a year-round service. | No. | Legislation is being prepared to put the operation of these ferry services out to tender. This is expected to take 4 to 5 years. Currently, negotiations are taking place with the operators and the state to draw up improved agreements, including a requirement that operators pay for the use of port facilities. |
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Portugal | There are Public Service Obligations ( PSOs) applying to some freight routes between the mainland, and Madeira and the Azores. The PSOs are applied through an authorisation system which places some light obligations on operators. | Yes. | N/A |
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Spain | There are 3 PSCs in Spain covering 3 bundles of routes: the Peninsula and connections to the Balearic Islands, the Canary Islands, and Ceuta and Melilla. Following a tender process Trasmediterranea holds the contract for all three contracts. Other operators on the 3 bundles of routes are required to provide discounted fares to island residents. These discounts are reimbursed by the government. | Yes. | N/A |
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Sweden | The only lifeline service is the one from the mainland to Gotland. It is provided under a PSC although the contract is not in compliance with EU rules (10 years plus 1 year possible extension). | No. | The Gotland service will be re-tendered in autumn 2005. |
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UK (Scotland) | Within the UK, the Scottish Executive, subsidises 2 bundles of services: between the Scottish mainland and the Orkney and Shetland Islands (Northern Isles), and 28 services within the Clyde and between the mainland the Hebrides (Clyde and Hebrides). The Northern Isles services were tendered in 2000 in line with EU rules. The Northern Isles services are currently being re-tendered ahead of schedule, also in line with EU rules. The Clyde and Hebrides services are currently provided by a state owned company under an open ended agreement. There are no subsidised lifeline ferry services in the UK outwith Scotland. | Partly. | The Executive is considering the requirement to tender the Clyde and Hebrides services. |
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