OPINION OF ADVOCATE GENERAL
JÄÄSKINEN
delivered on 13 December 2012 (1)
Case C‑625/10
European Commission
v
French Republic
(Action for failure to fulfil obligations – Directive 91/440/EEC – Development of the Community’s railways – Directive 2001/14/EC – Allocation of railway infrastructure capacity – Article 6(3) and Annex II of Directive 91/440 – Articles 4(2) and 14(2) of Directive 2001/14 – Infrastructure manager – Independence in the exercise of essential functions – Article 6(2) to (5) of Directive 2001/14 – Absence of measures providing managers with incentives to reduce the costs of provision of infrastructure and the level of access charges – Article 11 of Directive 2001/14 – Absence of a performance scheme)
1. By the present action for failure to fulfil obligations, the European Commission asks the Court to declare that the French Republic has failed to fulfil its obligations under Article 6(3) and Annex II of Directive 91/440/EEC, (2) as amended by Directive 2001/12/EC (3) (‘Directive 91/440’), and Articles 14(2), 6(2) to (5) and 11 of Directive 2001/14/EC. (4) The French Republic contends that the Commission’s action should be dismissed.
2. This action is one in a series of infringement proceedings (5) brought by the Commission in 2010 and 2011 concerning the application by Member States of Directives 91/440 and 2001/14, in particular with regard to equitable and non‑discriminatory access for railway undertakings to infrastructure, that is to say, the rail network. Those actions break new ground since they provide the Court with its first opportunity to examine the liberalisation of railways within the European Union and, inter alia, to interpret what is known as ‘the first railway package’.
3. On 6 September 2012 I delivered my Opinions in Commission v Portugal, cited above, and in Commission v Hungary; Commission v Spain; Commission v Austria; and Commission v Germany. In addition to the present Opinion, I am today delivering my Opinions in Commission v Poland; Commission v Czech Republic; Commission v Slovenia and Commission v Luxembourg. In so far the present case concerns similar complaints to those which I have already examined in those Opinions, I will simply make reference to the relevant points of the Opinions, without reproducing in full the arguments set out therein.
I – Legal framework
A – European Union law
1. Directive 91/440
4. The first subparagraph of Article 6(3) of Directive 91/440 provides:
‘Member States shall take the measures necessary to ensure that the functions determining equitable and non-discriminatory access to infrastructure, listed in Annex II, are entrusted to bodies or firms that do not themselves provide any rail transport services. Regardless of the organisational structures, this objective must be shown to have been achieved.’
5. Annex II to Directive 91/440 gives the list of ‘essential functions’ referred to in Article 6(3) of the directive:
– ‘...
– decision-making related to the path allocation including both the definition and the assessment of availability and the allocation of individual train paths,
– decision-making related to infrastructure charging,
– ...’
2. Directive 2001/14
6. Article 3(1) of Directive 2001/14 provides:
‘1. The infrastructure manager shall, after consultation with the interested parties, develop and publish a network statement obtainable against payment of a duty which may not exceed the cost of publishing that statement.’
7. Under Article 6(2) and (3) of Directive 2001/14:
‘2. Infrastructure managers shall, with due regard to safety and to maintaining and improving the quality of the infrastructure service, be provided with incentives to reduce the costs of provision of infrastructure and the level of access charges.
3. Member States shall ensure that the provision set out in paragraph 2 is implemented, either through a contractual agreement between the competent authority and infrastructure manager covering a period of not less than three years which provides for State funding or through the establishment of appropriate regulatory measures with adequate powers.’
8. Under Article 11 of Directive 2001/14:
‘1. Infrastructure charging schemes shall through a performance scheme encourage railway undertakings and the infrastructure manager to minimise disruption and improve the performance of the railway network. This may include penalties for actions which disrupt the operation of the network, compensation for undertakings which suffer from disruption and bonuses that reward better than planned performance.
2. The basic principles of the performance scheme shall apply throughout the network.’
9. Article 14(2) of that directive states:
‘Where the infrastructure manager, in its legal form, organisation or decision‑making functions is not independent of any railway undertaking, the functions referred to in paragraph 1 and described in this chapter shall be performed by an allocation body that is independent in its legal form, organisation and decision-making functions from any railway undertaking.’
B – French law
1. Law No 97‑135
10. Law No 97‑135 of 13 February 1997 creating the public institution ‘Réseau ferré de France’ with a view to the renewal of rail transport (loi n° 97‑135 du 13 février 1997 portant création de l’établissement public ‘Réseau ferré de France’ en vue du renouveau du transport ferroviaire (6) provides that Réseau ferré de France (‘RFF’) is the French railway infrastructure manager.
11. The second paragraph of Article 1 of that Law states:
‘Having regard to the requirements of safety and public service continuity, management of traffic and movements on the national rail network and operation and maintenance of the technical and safety installations for that network shall be carried out by the Société nationale des chemins de fer français (SNCF) on behalf of and in accordance with the management objectives and principles laid down by [RFF]. It shall provide it with remuneration to that end. ...’
2. Decree No 2003‑194
12. The first paragraph of Article 17 of Decree No 2003‑194 of 7 March 2003 on the use of the national rail network (7) (décret n° 2003‑194 du 7 mars 2003 relatif à l’utilisation du réseau ferré national) provides:
‘[RFF] shall draw up a national rail network statement containing all the information necessary for exercising the rights of access to the national rail network mentioned in Title I. ...’
13. Article 18 of that decree provides:
‘[RFF] shall be responsible for allocating infrastructure capacity for the national rail network in respect of the infrastructure which it manages or for which the infrastructure manager holds a partnership agreement concluded pursuant to Articles 1‑1 and 1‑2 of the abovementioned Law of 13 February 1997, in accordance with the detailed rules laid down in Articles 18 to 27 of the present decree. ...’
14. Article 21 of the decree provides: (8)
‘Requests for train paths shall be addressed to [RFF] under the conditions and in accordance with the detailed rules laid down by the network statement or, in the case of a framework agreement, by the provisions of that agreement.
…
[RFF] shall entrust the technical execution studies necessary for the examination of requests for train paths to the [SNCF], which is responsible, on its behalf, for management of traffic and movements on the national rail network. Such studies shall give rise to remuneration, to be borne by the requesting party, equal to the cost directly incurred as a result of conducting them.
The [SNCF] shall take the necessary steps, under the supervision of [RFF], to ensure the independence in the functions of the service which produces the technical reports in order to guarantee that there is no discrimination in the performance of those functions. That service shall respect the confidentiality of commercial information communicated to it for the purposes of those reports.
…’
15. A performance contract covering the period from 2008‑2012 was concluded between the French State and RFF on 3 November 2008.
3. Law No 82‑1153
16. Article 24(III) of Law No 82‑1153 of 30 December 1982 laying down guidelines for domestic transport (loi n° 82‑1153 du 30 décembre 1982 d’orientation des transports intérieurs), (9) as amended by Law No 2009‑1503 of 8 December 2009 on the organisation and regulation of rail transport and introducing various provisions relating to transport (loi n° 2009‑1503 du 8 décembre 2009 relative à l’organisation et à la régulation des transports ferroviaires et portant diverses dispositions relatives aux transports), (10) sets out detailed provisions on a specialised service which, within the SNCF, ‘shall perform, from 1 January 2010, on behalf of and in accordance with the management objectives and principles laid down by [RFF], the tasks related to management of traffic and movements on the national rail network mentioned in Article 1 of Law No 97‑135 … in conditions which ensure the independence of the essential functions thus performed and guarantee free and fair competition and the absence of any discrimination.’
II – The pre-litigation procedure and the procedure before the Court
17. On 27 June 2008, the Commission gave the French Republic formal notice requiring it to comply with the directives in the first railway package. On 9 September 2008, that Member State replied to the letter of formal notice. Following that reply, the French authorities sent an additional letter dated 14 July 2009.
18. On 9 October 2009, the Commission sent the French Republic a reasoned opinion. On 10 December 2009, the French Republic responded to that reasoned opinion by informing the Commission of the adoption and promulgation of Law No 2009‑1503 and further stating that the complaints raised by the Commission in its reasoned opinion were, in its view, unfounded. On 30 July 2010, the French Republic provided the Commission with additional information on the implementation of the first railway package.
19. Since it was not convinced by the reply and the information provided by the French Republic, the Commission decided to bring the present action. However, in the light of developments in the national regulatory framework since the reasoned opinion was sent, the Commission has restricted the scope of the present action for failure to fulfil obligations, brought by an application dated 22 December 2010, to Article 6(3) and Annex II of Directive 91/440, and Articles 14(2), 6(2) to (5) and 11 of Directive 2001/14.
20. By order of the President of the Court of 30 June 2011, the Kingdom of Spain was granted leave to intervene in support of the forms of order sought by the French Republic.
21. The Commission and the French Republic were represented at the hearing, which took place on 20 September 2012.
III – Analysis of the action for failure to fulfil obligations
A – The first complaint concerning the fact that an entity providing rail transport services may not be entrusted with essential functions relating to the allocation of train paths
1. Arguments of the parties
22. The Commission claims that, under Article 6(3) of Directive 91/440, because the allocation of train paths is an essential function determining equitable and non‑discriminatory access to infrastructure, listed in Annex II to that directive and to which the requirement of independence applies, an entity providing rail transport services (or a department set up within that entity) may not be made responsible for essential functions relating to the allocation of train paths. It also argues that, in accordance with Article 14(2) of Directive 2001/14, the allocation of infrastructure capacity must fall to an independent allocation body.
23. According to the Commission, whilst RFF, which is responsible for managing the infrastructure, is indeed a body that is independent from the SNCF, the SNCF is nonetheless responsible for certain essential functions relating to the allocation of train paths. The Commission observes in this regard that, although these essential functions are entrusted to a specialised service within the SNCF, the Direction des Circulations Ferroviaires (DCF), the DCF is not independent in its legal form, organisation and decision-making functions from the SNCF.
24. In the view of the Commission, the tasks entrusted to the DCF contribute to the performance of the essential functions as laid down in Annex II to Directive 91/440. The SNCF is responsible for significant elements of the process for the allocation of capacity within the meaning of Annex II to Directive 91/440, such as technical execution studies or the allocation of last-minute train paths. The Commission considers that even though RFF is responsible for allocating individual train paths, the studies with which the SNCF is entrusted are among the essential functions. These functions come under those referred to in Article 14(2) of Directive 2001/14 and must therefore be managed by an independent body.
25. The Commission claims that Article 6(3) of Directive 91/440 and Article 14(2) of Directive 2001/14 must be read together and are mutually complementary. The rule of the independence of the essential functions laid down in general terms in Article 6(3) of Directive 91/440 is given greater precision and detail in Article 14(2) of Directive 2001/14 as regards the allocation of train paths. That directive does not provide that essential functions may be performed by a railway undertaking under the ‘supervision’ of an independent body. The aim of Article 14(2) is that railway undertakings do not exercise any powers in relation to the allocation of train paths, in order to ensure equitable and non-discriminatory treatment between railway undertakings.
26. With regard to the independence of the DCF in its legal form, the Commission takes the view that it is a specialised service of the SNCF which is not therefore independent in that respect, contrary to the requirements of Article 14(2) of Directive 2001/14, since not only does the DCF have no legal personality, but it is also legally integrated into the legal personality of the SNCF. As regards the independence of the DCF in its organisation and decision-making functions, the Commission states that there are inadequate assurances of this.
27. Lastly, in its reply, the Commission adds that, even though the adoption of Decree No 2011‑891 (11) represented an improvement on the current situation, it is not enough to give the DCF sufficient independence in its organisation and decision-making functions and, a fortiori, in its legal form.
28. The French Republic claims that independence is ensured in so far as the essential functions entrusted to the DCF are supervised by RFF. The DCF contributes to the performance of the essential functions, but does not manage them, since RFF alone is responsible for the allocation of train paths. The French Government claims that the requirement of independence in legal form does not require the DCF to have distinct legal personality from the SNCF.
29. It also considers that Article 14(2) of Directive 2001/14 does not apply to the French situation because that provision is applicable only ‘where the infrastructure manager is not independent’. The infrastructure manager, namely RFF, is independent and that article is not therefore applicable to the activities of the DCF.
30. The French Government claims that, although the DCF is part of a rail transport provider, it remains a body that is independent in its functions. The DCF cannot therefore be considered to constitute a body which provides rail transport services for the purposes of Article 6(3) of Directive 91/440. The French Government also rejects the Commission’s arguments concerning independence in organisation and decision-making functions. In its rejoinder, the French Government argues that the transposition of Article 6(3) and Annex II of Directive 91/440 has been fully completed since the adoption of Decree No 2011‑891, pursuant to Law No 2009-1503.
2. Examination of the first complaint
31. I would note at the outset that the French Republic is contesting the failure to fulfil obligations and also considers that since the adoption of Decree No 2011‑891, the transposition of Article 6(3) and Annex II of Directive 91/440 has been fully completed.
32. In this latter regard, it should be pointed out, first of all, that it is settled case-law that the question whether a Member State has failed to fulfil its obligations must be determined by reference to the situation prevailing in the Member State at the end of the period laid down in the reasoned opinion. (12) Thus, the Court is not required to examine the substance of the arguments put forward by the Member State claiming that legislation introduced after the expiry of the time-limit laid down in the reasoned opinion complied with the directive. For that reason, there is no point in examining the contribution made by Decree No 2011‑891.
33. In the present case, the historic operator, the SNCF, was entrusted, under the supervision of the independent body responsible for the essential function of allocating capacity and individual train paths, with tasks, described as ‘technical’ by the Member State, which consist in conducting technical execution studies necessary for the examination of requests for train paths and for the allocation of ‘last minute’ train paths, namely less than seven days before the date of the desired train run. (13)
34. This first complaint raises two main questions. The first is whether a rail transport undertaking may be involved in some way, directly or indirectly, in the performance of an essential function. The second is whether participation in the performance of that essential function requires, as regards decision-making functions, that independent body to have distinct legal personality from the railway undertaking.
35. The first question does not really present any major difficulties since, under Article 6(3) of Directive 91/440, the functions listed in Annex II to the directive may only be ‘entrusted to bodies or firms that do not themselves provide any rail transport services’. The annex makes reference to ‘decision-making related to the path allocation including both the definition and the assessment of availability and the allocation of individual train paths’.
36. It is thus clear from the very wording of Directive 91/440 that ‘the definition and the assessment of availability’ are among the competences conferred on the body responsible for the essential function of allocating capacity and train paths. It is not therefore possible for the independent body, which may not be a rail transport undertaking, to entrust to such an undertaking the preparatory work before a decision is taken. Thus, the fact that a service of the SNCF, namely the DCF, acts on behalf of RFF, which retains full powers to decide on the timetable and the allocation of individual train paths, is not enough to validate this system.
37. The French Republic considers, however, that the body responsible for this function, in this case the DCF, is independent in its functions within the transport undertaking. The French legislature created within the SNCF a specialised service which is independent in its organisation and decision-making functions. According to that Member State, the DCF cannot be assimilated with the SNCF, as it is independent in its functions.
38. I would point out that, to a certain extent, the present action raises the opposite question to the integrated system of a holding company which was at the heart of Commission v Poland (see points 38 to 44 of my Opinion); Commission v Austria (see points 53 to 104 of my Opinion); and Commission v Germany (see points 59 to 64 of my Opinion). In the ‘holding’ model, independence in legal form is accepted and the question raised is independence in decision‑making functions. In the present case, independence in decision-making functions seems to be accepted and the question is of independence in legal form.
39. It would appear that the French Republic’s defence is based on the separation between Article 6(3) of Directive 91/440 and Article 14(2) of Directive 2001/14. If, as the French Republic proposes, Article 14 of Directive 2001/14, which refers to independence in legal form, organisation and decision-making functions, is disregarded, there is only Article 6 of Directive 91/440, which simply requires that the ‘bodies or firms’ do not themselves provide any rail transport services. Thus, in the view of the French Republic, this latter provision does not specify the form which must be taken by such bodies or firms. Accordingly, Article 6(3) of Directive 91/440 does not require bodies or firms entrusted with essential functions to have legal personality. The DCF is a ‘body’ which does not provide any transport services.
40. On the other hand, according to the French Republic, Article 14(2) of Directive 2001/14 is inapplicable because RFF is an independent company and the requirement of the independence of the body responsible for the essential function of allocating capacity and individual train paths is applicable only where the infrastructure manager is not independent of any rail transport undertaking.
41. In my view, this reasoning must be rejected. I consider that, because the task entrusted to the DCF is an essential function, the DCF is subject to the requirements laid down in Article 6(3) of Directive 91/440 and in Article 14(2) of Directive 2001/14, which cannot be separated. RFF is independent from the SNCF, but assigns to the SNCF a proportion of the essential functions with which it has been entrusted, in such a way that RFF no longer appears independent in respect of that proportion of the functions, which must be entrusted to an independent body in accordance with Article 14(2) of Directive 2001/14.
42. In addition, I would point out that those directives did not make any provision for the subcontracting of the performance of essential functions to a railway undertaking. Its exclusion is clear from the broad logic of the provisions in question, namely Article 6(3) of Directive 91/440 and Article 14(2) of Directive 2001/14. The Commission is right to state that, if that were not the case, the Member States could circumvent the application of the latter provision entirely by creating an independent infrastructure manager, which then subcontracts its activities to a railway undertaking.
43. The French Republic is therefore wrong to claim that the Commission’s complaint should be examined solely in the light of Article 6(3) of Directive 91/440. On the contrary, the French system must be assessed having regard to the requirement of a body which is independent in its legal form, organisation and decision-making functions, as is clear from a combined reading of the abovementioned provisions.
44. The Commission contests both the DCF’s independence in its legal form and its independence in its organisation and decision-making functions. It claims that the condition of independence in legal form is not satisfied because where the infrastructure manager delegates essential functions to a distinct body, that body must obviously satisfy the same requirements of independence as the infrastructure manager.
45. I cannot see what independence in legal form could be in relation to a company like the SNCF if it did not entail its own legal personality. (14) It must therefore be stated that the French system does not satisfy the condition of independence in legal form.
46. The Commission contests the DCF’s independence in its organisation and decision-making functions on the basis of criteria put forward vis-à-vis the integrated system of a holding company. In my view, these other two aspects of management independence should not be viewed separately since the three aspects of independence must be satisfied cumulatively, with the result that a simple finding that the DCF is not independent in its legal form is sufficient to establish an infringement of the abovementioned provisions.
47. On those grounds, I conclude that the Commission’s first complaint must be considered to be well-founded.
B – The second complaint concerning charges made for access to the railway infrastructure
1. Arguments of the parties
48. The Commission claims that the French Republic has failed to fulfil its obligations under Article 11 of Directive 2001/14 in so far as the French legislation does not currently include a performance scheme as provided for in that article. The measures mentioned by the Member State do not form such a scheme.
49. The Commission also claims that, by not introducing an incentive scheme as provided for in Article 6(2) to (5) of Directive 2001/14, the French Republic has failed to fulfil its obligations under those provisions.
50. As regards measures providing infrastructure managers with incentives to reduce the costs of provision of infrastructure, the Commission claims that the measures taken by the French authorities are not accompanied by an incentive scheme encouraging the infrastructure manager significantly to achieve those objectives.
51. With regard to the reduction of the level of infrastructure access charges, the Commission points out that the performance contract, (15) signed on 3 November 2008 between the State and RFF, does not include any objectives.
52. The French Government claims that the performance contract defines the objectives of infrastructure modernisation and the detailed rules on the development of a new commercial network service, with a view to improving quality, services and safety. Consequently, that contract includes provisions to encourage the infrastructure manager to reduce disruption and improve the performance of the railway network.
53. The French Republic also argues that the general conditions applicable to contracts for the use of infrastructure, in so far as they provide for compensation in cases of non-compliance, thus contain provisions which seek to encourage both railway undertakings and the infrastructure manager to reduce disruption and improve the performance of the railway network.
54. With regard to measures providing infrastructure managers with incentives to reduce the costs of provision of infrastructure, the French authorities claim that they have introduced a staff bonus mechanism directly linked to reducing such costs and have therefore adopted relevant incentives.
55. As far as the objective of reducing the level of railway infrastructure access charges is concerned, the French Government considers that the reduction of charges for the use of railway infrastructure cannot under any circumstances constitute an absolute objective laid down by Directive 2001/14.
56. The Spanish Government has intervened in the proceedings only in support of the arguments put forward by the French Government in connection with the questions raised by the first limb of the second complaint in the action. In this regard, the Spanish Government asserts that Directive 2001/14 does not define or impose any criteria with a view to the establishment of a performance scheme and merely makes reference to the objective of that scheme.
57. As regards measures to reduce the amount of access charges, it is not reasonable to reduce their amounts without first modernising the railway network and, at the same time, reducing maintenance costs. This fact rules out any infringement of the abovementioned provisions a priori.
2. Examination of the second complaint
58. It should be noted at the outset that the first limb of the Commission’s second complaint, which concerns the absence of measures to encourage railway undertakings and the infrastructure manager to minimise disruption and improve the performance of the railway network by establishing a ‘performance scheme’, is essentially identical to the second complaint in Commission v Spain (see points 67 to 72 of my Opinion), and to the fourth complaint in Commission v Czech Republic (see points 90 to 93 of my Opinion).
59. Similarly, the second limb of the Commission’s second complaint, which concerns the absence of measures providing infrastructure managers with incentives to limit the costs connected with the infrastructure service or the level of access charges, is essentially identical to the third complaint in Commission v Germany (see points 93 to 104 of my Opinion), the third complaint in Commission v Poland (see points 74 to 84 of my Opinion), and the second complaint in Commission v Czech Republic (see points 47 to 55 of my Opinion).
60. For that reason, reference should be made to the legal reasoning developed in the Opinions delivered in those cases. However, the French legislation has specific characteristics compared with the situation in those Member States. Consequently, the examination of the substance of the complaint must take account of the specific situation in France.
61. I consider that the French Republic had not, on the date of expiry of the time-limit prescribed in the reasoned opinion, implemented a performance scheme for railway undertakings and infrastructure managers which satisfies the requirements of Article 11 of Directive 2001/14. Even supposing that the measures mentioned by that Member State could be regarded as measures to encourage the undertakings concerned to improve service performance, they do not in any event constitute a coherent and transparent whole capable of forming part of an infrastructure charging system.
62. This is true of both Article 6.4 of the RFF network statement, (16) which provides for specific charging for the right to reserve freight train paths subject to two conditions, and the other two documents mentioned by the French authorities, namely the general conditions applicable to contracts for the use of infrastructure and the performance contract. With regard to the latter, the Commission rightly claims that the commitments entered into by RFF in relation to performance quality have nothing to do with ‘a performance scheme’ and have no connection with the charging schemes mentioned in Article 11 of Directive 2001/14.
63. Under Article 6(2) of Directive 2001/14, infrastructure managers must, with due regard to safety and to maintaining and improving the quality of the infrastructure service, be provided with incentives to reduce the costs of provision of infrastructure and the level of access charges. Unlike the provision made under Article 11 of the directive with regard to rail network performance improvement, Article 6(2) of that directive does not require the incentives to form a ‘scheme’. (17)
64. However, Article 6(3) of Directive 2001/14 envisages two possibilities for implementing the obligation set out in paragraph 2 of that article. It must be done either through a multiannual agreement between the infrastructure manager and the competent authority which provides for State funding or through the establishment of appropriate regulatory measures with adequate powers. However, even if measures taken in isolation could be regarded as incentives, they cannot represent measures within the meaning of Article 6(2) if they do not come within the framework of one of the two possibilities defined in paragraph 3 of that article.
65. The French Republic also claims that it has introduced a staff bonus mechanism for RFF which is directly linked to reducing these costs of provision of infrastructure and therefore constitutes incentives.
66. It seems that, in its reply, the Commission acknowledges that the bonus scheme under the incentive agreement of 26 June 2009 for RFF staff could actually constitute a sufficient measure to encourage the infrastructure manager to reduce the costs of provision of infrastructure. I note that that agreement (18) defines as a staff incentive criterion the attainment of the objective of GOPEQ (‘Grosse opération programmée équivalente’ (‘Equivalent Planned Large Operation’)), as defined in the abovementioned performance contract of 3 November 2008 concluded between the French State and RFF covering the period from 2008 to 2012. The monitoring of that index, which relates to the unit costs representing the full renewal works for one kilometre of track, establishes a staff bonus mechanism directly linked to reducing the costs of provision of infrastructure. The French Republic therefore appears to have complied with its obligation to introduce measures providing incentives to reduce the costs of provision of infrastructure. (19)
67. As far as the objective of reducing the level of railway infrastructure access charges is concerned, the defendant Member State considers that such a reduction cannot under any circumstances constitute an absolute objective laid down by Directive 2001/14. I share that view. For the reasons set out in my Opinion in Commission v Germany, I do not think that the Member States are required to provide for a specific incentive with a view to reducing charges for the use of infrastructure in so far as that does not follow from the reduction of the level of costs of provision of infrastructure.
68. The Commission considers, in contrast, that an autonomous obligation to reduce access charges is essential in order to combat the tendency among infrastructure managers, which are natural monopolies, not to redistribute surpluses resulting from increased management efficiency to their customers. However, as the Agent for the French Government rightly stated at the hearing, Article 6(1) of Directive 2001/14 permits a Member State to require the infrastructure manager to balance his accounts without State funding. It would therefore be unreasonable to give paragraph 2 of that article an interpretation under which the Member State were required to provide the manager with incentives to act against that objective. In any event, Article 8(1) of Directive 2001/14 limits the maximum charges levied to full recovery of the costs incurred by the infrastructure manager.
69. On those grounds, I propose that the Court uphold the Commission’s second complaint in so far it alleges that the French Republic failed to fulfil its obligations under Article 11 of Directive 2001/14 and reject it as to the remainder.
IV – Costs
70. Under Article 138(3) of the Rules of Procedure, (20) the parties are to bear their own costs where each party succeeds on some and fails on other heads. As both the Commission and the French Republic have failed on several heads, I propose that each party bears its own costs.
71. In accordance with Article 140(1) of the Rules of Procedure, the Kingdom of Spain, which was granted leave to intervene in the present case, is ordered to bear its own costs.
V – Conclusion
72. In the light of the foregoing, I propose that the Court:
(1) declare that the French Republic has failed to fulfil its obligations under
– Article 6(3) and Annex II of Council Directive 91/440/EEC of 29 July 1991 on the development of the Community’s railways, as amended by Directive 2001/12/EC of the European Parliament and of the Council of 26 February 2001, and Article 14(2) of Directive 2001/14/EC of the European Parliament and of the Council of 26 February 2001 on the allocation of railway infrastructure capacity and the levying of charges for the use of railway infrastructure and safety certification, in so far as a service of a railway undertaking participates in the performance of essential functions which must be entrusted to a railway infrastructure manager or a body which is independent from railway undertakings in its legal form,
– Article 11 of Directive 2001/14, in so far as the French legislation does not include a performance scheme as provided for in that article;
(2) dismiss the action as to the remainder;
(3) order the European Commission, the French Republic and the Kingdom of Spain to bear their own costs.