OPINION OF ADVOCATE GENERAL
JÄÄSKINEN
delivered on 13 December 2012 (1)
Case C‑512/10
European Commission
v
Republic of Poland
(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) to Directive 2001/14 – Infrastructure manager – Independence in organisation and decision-making functions – Holding company structure – Article 6(2) and (3) of Directive 2001/14 – Continued absence of financial balance – Articles 6(1) and 7(3) and (4) of Directive 91/440 – Absence of incentives for infrastructure managers – Articles 7(3) and 8(1) of Directive 2001/14 – Calculation of the minimum access charge)
I – Introduction
1. By its action for failure to fulfil obligations, the European Commission asks the Court to declare that the Republic of Poland has failed to fulfil its obligations under Article 6(3) of and Annex II to Directive 91/440/EEC, (2) as amended by Directive 2007/58/EC (3) (‘Directive 91/440’), Articles 4(2) and 14(2) of Directive 2001/14/EC (4) (‘Directive 2001/14’), Article 6(2) and (3) of Directive 2001/14, Article 6(1) of Directive 2001/14, in conjunction with Article 7(3) and (4) of Directive 91/440, and Articles 7(3) and 8(1) of Directive 2001/14. The Republic of Poland 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, the main object of which is to ensure 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, cited above. In addition to the present Opinion, I am today delivering my Opinions in Commission v Czech Republic, Commission v France, Commission v Slovenia, and Commission v Luxembourg, cited above. In so far as 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 however reproducing in full the arguments set out therein.
II – Legal framework
A – European Union law
1. Directive 91/440
4. Article 6(1) to (3) of Directive 91/440 provides:
‘1. Member States shall take the measures necessary to ensure that separate profit and loss accounts and balance sheets are kept and published, on the one hand, for business relating to the provision of transport services by railway undertakings and, on the other, for business relating to the management of railway infrastructure. Public funds paid to one of these two areas of activity may not be transferred to the other.
The accounts for the two areas of activity shall be kept in a way that reflects this prohibition.
2. Member States may also provide that this separation shall require the organisation of distinct divisions within a single undertaking or that the infrastructure shall be managed by a separate entity.
3. 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.
Member States may, however, assign to railway undertakings or any other body the collecting of the charges and the responsibility for managing the railway infrastructure, such as investment, maintenance and funding.’
5. Annex II to Directive 91/440 gives the list of ‘essential functions’ referred to in Article 6(3) of the directive:
– preparation and decision-making related to the licensing of railway undertakings including granting of individual licenses,
– 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, and
– monitoring observance of public service obligations required in the provision of certain services.
6. Article 7(3) and (4) of Directive 91/440 provides:
‘3. Member States may also accord the infrastructure manager, having due regard to Articles 73, 87 and 88 of the Treaty, financing consistent with the tasks, size and financial requirements, in particular in order to cover new investments.
4. Within the framework of general policy determined by the State, the infrastructure manager shall draw up a business plan including investment and financial programmes. The plan shall be designed to ensure optimal and efficient use and development of the infrastructure while ensuring financial balance and providing means for these objectives to be achieved.’
2. Directive 2001/14
7. Recitals 11 and 16 in the preamble to Directive 2001/14 read as follows:
‘The charging and capacity allocation schemes should permit equal and non‑discriminatory access for all undertakings and attempt as far as possible to meet the needs of all users and traffic types in a fair and non-discriminatory manner.
...
Charging and capacity allocation schemes should allow for fair competition in the provision of railway services.’
8. Article 4(2) of Directive 2001/14 provides:
‘Where the infrastructure manager, in its legal form, organisation or decision‑making functions, is not independent of any railway undertaking, the functions, described in this chapter, other than collecting the charges shall be performed by a charging body that is independent in its legal form, organisation and decision-making from any railway undertaking.’
9. Under Article 6 of Directive 2001/14:
‘1. Member States shall lay down conditions, including where appropriate advance payments, to ensure that, under normal business conditions and over a reasonable time period, the accounts of an infrastructure manager shall at least balance income from infrastructure charges, surpluses from other commercial activities and State funding on the one hand, and infrastructure expenditure on the other.
...
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.
...’
10. Article 7(3) of Directive 2001/14 provides:
‘Without prejudice to paragraphs 4 or 5 or to Article 8, the charges for the minimum access package and track access to service facilities shall be set at the cost that is directly incurred as a result of operating the train service.’
11. Article 8(1) of that directive reads as follows:
‘In order to obtain full recovery of the costs incurred by the infrastructure manager a Member State may, if the market can bear this, levy mark-ups on the basis of efficient, transparent and non-discriminatory principles, while guaranteeing optimum competitiveness in particular of international rail freight. The charging system shall respect the productivity increases achieved by railway undertakings.
The level of charges must not, however, exclude the use of infrastructure by market segments which can pay at least the cost that is directly incurred as a result of operating the railway service, plus a rate of return which the market can bear.’
12. Under Article 14(2) of Directive 2001/14:
‘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 from any railway undertaking.’
B – Polish legislation
1. Law of 8 September 2000
13. Article 15 of the Law on the sale, restructuring and privatisation of the public undertaking Polskie Koleje Państwowe (ustawa z dnia 8 września 2000 r. o komercjalizacji, restrukturyzacji i prywatyzacji przedsiębiorstwa państwowego ‘Polskie Koleje Państwowe’) of 8 September 2000, (6) as amended (‘the Law of 8 September 2000’), provides:
‘1. PKP SA shall create a joint stock company responsible for managing railway lines, operating under the name “PKP Polskie Linie Kolejowe Spółka Akcyjna”, hereinafter referred to as “PLK SA”.
2. PLK SA shall, from the date of its entry in the commercial register, assume the rights and obligations of PKP SA with regard to the management of railway lines in accordance with the Law referred to in Article 14(2)(2).
2a. As long as PLK SA is in receipt of public loans to finance its investments in infrastructure, the shares in that company shall not carry any dividend.
3. The management of railway lines by PLK SA shall also include the tasks referred to in Article 49(1) of the Law of 27 June 1997 on rail transport, performed by track watchmen, integrated into the organisational structure of PLK SA.
4. PLK SA shall become the railway line manager within the meaning of the Law referred to in Article 14(2)(2).
4a. PLK SA shall manage railway lines and other railway infrastructure, as defined in the [Law on rail transport (ustawa z dnia 28 marca 2003 r. o transporcie kolejowym) of 28 March 2003, (7) as amended (“the Law on rail transport”)], except for buildings and other structures assigned to passenger and goods transport and land occupied by such buildings and structures.
4b. The exception mentioned in paragraph 4a shall not cover structures located on land forming an integral part of the railway lines.
5. The Minister responsible for Transport shall approve the statutes of PLK SA and amendments made thereto.
6. The general meeting of PLK SA shall appoint the members of the supervisory board of PLK SA from the persons proposed for that position by the Minister responsible for Transport. The number of members of the supervisory board of PLK SA shall be laid down in the statutes.
7. State budget expenditure earmarked in a particular financial year for the financing of railway lines of national interest shall increase the capital issued by PLK SA; the shares corresponding to the increase in capital shall be held by the Treasury, represented by the Minister responsible for Transport.
8. The shares in PLK SA held by PKP SA and by the Treasury may not be sold, without prejudice to paragraph 8a.
8a. The shares in PLK SA held by PKP SA may be sold only to the Treasury.
9. In the event of the privatisation or liquidation of PKP SA, the shares in PLK SA held by PKP SA shall be acquired by the Treasury, represented by the Minister responsible for Transport. In the event of the privatisation of PKP SA, there shall be a reduction in the share capital of PKP SA through the cancellation of a number of shares with a value equivalent to the nominal value of the shares in PLK SA acquired by the Treasury.’
2. Law on rail transport
14. Article 5(1) to (3) of the Law on rail transport (ustawa z dnia 28 marca 2003 r. o transporcie kolejowym, (8) as amended, ‘the Law on rail transport’) provides:
‘1. Management of the railway infrastructure shall consist in:
(1) construction and maintenance of the railway infrastructure;
(2) operation of trains on the railway lines;
(3) maintenance of the railway infrastructure in a condition guaranteeing that trains operate in full safety;
(4) provision of train paths for train movements on the railway lines and related services;
(5) management of real property forming part of the railway infrastructure.
2. The infrastructure manager, hereinafter “the manager”, shall manage the railway infrastructure and ensure its development and modernisation.
3. The manager shall not be authorised to operate rail transport services, excluding technological services carried out for its own purposes, subject to paragraph 4.’
15. Under Article 13(1) of that Law:
‘The President of the Office for Rail Transport, hereinafter “the President of the ORT”, shall have competence in matters of rail transport regulation for:
(1) approving and coordinating charges for the use of the allocated train paths, verifying their conformity with the rules governing the setting of such charges;
...
(3) checking that the managers observe equal treatment for all rail carriers, in particular with regard to the processing of requests for the allocation of train paths and the setting of charges;
(4) determining whether the manager has correctly set the basic charges for the use of the railway infrastructure and the additional charges for services provided;
(5) examining appeals lodged by rail carriers concerning:
...
(b) the allocation of train paths and charges for the use of the railway infrastructure ...’.
16. Article 14(1) of the Law on rail transport provides:
‘The President of the ORT shall order, by a decision, the elimination of any irregularity within the prescribed period in the event of infringement of the provisions relating to the rail transport safety obligations of managers, rail carriers and users of branch lines ...’.
17. Under Article 33(1) to (8) of that Law:
‘1. The manager shall set the amount of the charges payable by rail carriers for the use of the infrastructure.
2. The basic charge for the use of the railway infrastructure shall be set taking into consideration the cost, borne by the manager, directly incurred as a result of operating the train service.
3. The charge for the use of the railway infrastructure shall be composed of the basic charge and additional charges.
3a. In connection with the basic charge, the manager shall apply a separate charge for
(1) minimum access to the railway infrastructure, encompassing the services referred to in Part I(1) of the Annex to the Law;
(2) access to installations connected with train maintenance, encompassing the services referred to in Part I(2) of the Annex to the Law.
4. The basic charge for minimum access to the railway infrastructure shall be calculated as the product of the train movements and the unit rates set according to the category of railway line and type of train, separately for passenger transport and goods transport.
4a. The manager may apply a minimum unit rate for the basic charge for minimum access to the railway infrastructure. The minimum rate shall apply on an equivalent basis to all passenger rail carriers for the use of the railway infrastructure in connection with activities performed under the public service agreement.
...
4c. The basic charge for access to equipment connected with train maintenance shall be calculated as the product of the services ordered and the corresponding unit rates, the amount of which shall vary according to the type of services referred to in Part I(2) of the Annex to the Law.
5. The unit rate for the basic charge for minimum access to the railway infrastructure shall be set per train, per kilometre travelled.
5a. In setting the unit rates for the basic charge, the manager shall subtract from the amount earmarked for expenses for provision of the railway infrastructure to rail carriers the subsidy for the renovation and maintenance of the infrastructure from the budget of the State or of the local authorities and the resources provided from the Rail Fund.
...
5c. The increase in the unit rates for the basic charge for passenger rail transport under a public service agreement, during the period of validity of the timetables within the meaning of Article 30(5), may not exceed the level of the inflation index laid down in the draft budget law for the relevant year.
6. The manager shall publish, in accordance with the practice in force, the amount and the types of rates of the basic charge and the additional charges, distinguishing between passenger transport and goods transport.
7. The unit rates for the basic charge and for the additional charges, except charges for the use of traction current, shall be communicated, together with the calculations of their amount, to the President of the ORT.
8. The President of the ORT shall approve the rates, within 30 days of receipt, or refuse to approve them if he finds infringements of the rules mentioned in paragraphs 2 to 6, Article 34 or Article 35.’
18. Article 38a(1) and (2) of the Law on rail transport provides:
‘1. The Minister responsible for Transport may co-finance from the State budget or from the Rail Fund expenditure for the renovation and maintenance of the railway infrastructure, in order to reduce expenditure and the amount of charges for use, if the infrastructure is provided by the manager in accordance with the principles defined by the Law.
2. The task referred to in paragraph 1 shall be performed on the basis of an agreement concluded between the Minister responsible for Transport and the manager for a period longer than or equal to three years.’
3. Law on the suppression of unfair competition
19. Article 3 of the Law on the suppression of unfair competition (ustawa o zwalczaniu nieuczciwej konkurencji) of 16 April 1993, (9) as amended, provides:
‘1. Any act which is contrary to the law or to public morality and which threatens or violates the interests of another operator or client shall constitute an act of unfair competition.
2. Acts of unfair competition shall include the following: ... the violation of trade secrets, incitement for the termination or non-performance of a contract, ... slander or unfair praise, barriers to access to the market, bribery of a person performing public functions ...’
4. Labour Code
20. Article 100 of the Law establishing the Labour Code (ustawa z dnia 26 czerwca 1974 r. Kodeks pracy) (10) of 26 June 1974, as amended, provides:
‘...
2. An employee shall be required, inter alia:
...
(4) to look after the interests of the establishment, to protect its assets and to respect the confidentiality of information whose disclosure would be likely to cause damage to the employer,
(5) to respect confidentiality as defined in specific provisions,
...’
III – The pre-litigation procedure and the procedure before the Court
21. On 10 May 2007, the Commission staff sent a questionnaire to the Polish authorities in order to verify the transposition by the Republic of Poland of the directives in the first railway package. The Polish authorities replied on 5 July 2007.
22. On 26 June 2008, on the basis of the information communicated by the Republic of Poland, the Commission gave that Member State formal notice requiring it to comply with the directives in the first railway package. The main irregularities identified related to the lack of independence of the entity performing essential functions within the meaning of Annex II to Directive 91/440 and the levying of infrastructure access charges under Article 7(3) of Directive 2001/14, in conjunction with Article 30(3) of that directive. On 26 August 2008, the Republic of Poland replied to the letter of formal notice sent by the Commission.
23. On 9 October 2009, the Commission sent the Republic of Poland a reasoned opinion complaining that it had not taken the necessary measures to guarantee the independence of the railway infrastructure manager vis-à-vis rail carriers and to ensure compliance with Article 7(3) and (4) of Directive 91/440, Article 6(2) and (3) of Directive 2001/14, Article 6(1) of Directive 2001/14, in conjunction with Article 7(3) and (4) of Directive 91/440, and Articles 7(3) and 8(1) of Directive 2001/14. On 9 December 2009, the Republic of Poland replied to that reasoned opinion and disputed the infringements alleged by the Commission.
24. In those circumstances, the Commission brought the present action for failure to fulfil obligations on 26 October 2010.
25. By order of the President of the Court of 13 April 2011, the Czech Republic and the Italian Republic were granted leave to intervene in support of the forms of order sought by the Republic of Poland.
26. The Commission, the Republic of Poland and the Czech Republic were represented at the hearing, which took place on 20 September 2012.
IV – Analysis of the action for failure to fulfil obligations
A – The first complaint, concerning the lack of independence of the infrastructure manager
1. Arguments of the parties
27. In the view of the Commission, Article 6(3) of Directive 91/440 should be interpreted to the effect that the essential functions performed by the infrastructure manager must be carried out by an entity independent of railway undertakings not only in its legal form, but also economically. Where essential functions are performed by a company that is dependent on a holding company to which providers of rail transport services belong, that company is part of the same ‘firm’ as the providers in question unless it is shown that that company is free to act independently of them.
28. According to the Commission, the performance of essential functions by a company that is dependent on a railway holding company may be consistent with the requirements of independence laid down in Article 6(3) of Directive 91/440 and in Articles 4(2) and 14(2) of Directive 2001/14, provided there are mechanisms to guarantee real decision-making autonomy for that company vis‑à‑vis the holding company and the holding company is not able to control decisions taken by that company.
29. In this regard, the Commission states that, in Annex 5 to Commission staff working document SEC(2006) 530, annexed to the report on the implementation of the first railway package (11) (‘Annex 5 to working document SEC(2006) 530’), it presented criteria on the basis of which it will assess the independence of infrastructure managers integrated into national railway holding companies.
30. It asserts that the Republic of Poland has not provided effective mechanisms to guarantee the independence of the infrastructure manager performing essential functions in its organisation and decision-making functions.
31. The Republic of Poland criticises the Commission in general terms for having failed to analyse the provisions of national law or show that they do not guarantee sufficient independence with a view to equal and non-discriminatory access to the infrastructure in accordance with the objective pursued by Directive 91/440.
32. The Republic of Poland argues in particular that Article 6(3) of Directive 91/440, which does not prohibit the entity to which essential functions are entrusted from being part of a holding company like the PKP Group, requires only that the objective of equal and non-discriminatory access to the infrastructure is achieved. The Commission has not submitted any arguments of fact or of law to indicate that that objective has not been achieved in Poland.
33. With regard to Articles 4(2) and 14(2) of Directive 2001/14, the Republic of Poland argues that those provisions mention the independence of the manager in its legal form, organisation and decision-making functions, but do not define these notions or mention economic independence. According to that Member State, these notions must be interpreted in the light of the objective of that directive, which has been fully achieved by the Republic of Poland.
34. As regards Annex 5 to working document SEC(2006) 530, the Republic of Poland notes that that document was published many years after the publication of Directive 91/440 and the expiry of the time-limit for the transposition of that directive, and three years after the expiry of the time-limit for the transposition of Directive 2001/14.
35. With respect to the situation of the infrastructure manager, PLK SA, the Republic of Poland disputes the Commission’s argument that PLK SA is not independent for the purposes of Article 6(3) of Directive 91/440.
36. In its statement in intervention, the Italian Republic claims that the objective of ensuring that essential functions are entrusted to bodies or firms that do not themselves provide any rail transport services is clearly achieved in the organisational model of the holding company, since those functions are assigned to a distinct company, which performs only infrastructure management activities and, as such, does not itself provide any rail transport services. Once that requirement has been satisfied, the Member States are free – within the margin of discretion accorded to them by the directive and in accordance with the principle of subsidiarity – to authorise national railway groups to structure themselves in the way which they consider most appropriate, including by adopting group structures headed by a joint holding company.
37. In its reply to the Italian Republic’s statement in intervention, the Commission contends that entrusting essential functions to bodies or firms that do not themselves provide any rail transport services is not in itself the objective of Article 6(3) of Directive 91/440, but serves to guarantee equitable and non-discriminatory access to the infrastructure. Separating the body performing essential functions from railway undertakings only in its legal form, i.e. creating, under the holding company, a company that is separate from any railway undertakings to which the performance of essential functions is entrusted, is not sufficient to guarantee equitable and non-discriminatory access to the railway infrastructure for all the bodies concerned outside the holding company. In addition, in the case of a holding company, it is essential to create mechanisms to guarantee the independence of that body in its decision-making functions vis-à-vis other companies owned by the holding company (railway undertakings and their parent company).
2. Examination of the first complaint
38. As I have already explained in my Opinion in Commission v Austria, (12) the provisions of Article 6(3) of and Annex II to Directive 91/440 and of Articles 4(2) and 14(2) of Directive 2001/14, which provide for a requirement of independence on the part of the body entrusted with essential functions, cannot justify an interpretation according to which the Member States that have opted for the holding company model are required to adopt laws, regulations or agreements corresponding to the interpretation applied by the Commission in Annex 5 to working document SEC(2006) 530.
39. Consequently, in an action in respect of the incorrect or incomplete transposition of the abovementioned provisions of Directive 2001/14, the Republic of Poland cannot be criticised for failing to adopt specific rules:
– prohibiting members of the board of directors or of the supervisory board, members of the governing bodies or employees of PKP SA, of dependent undertakings of PKP SA or of rail transport undertakings from performing functions within the board of directors or the supervisory board of PLK SA, both during their term of office and for a sufficiently long period after the end of their term of office; the same applies to persons performing identical functions within PLK SA and having similar links with other companies in the group;
– creating mechanisms to guarantee the mutual independence of the entities responsible for rail transport and management of the infrastructure;
– providing mechanisms to protect access to computer systems with a view to ensuring the independence of the entity entrusted with essential functions in the performance of those functions, and
– introducing restrictions applying to communications between the staff of the entity entrusted with essential functions and other entities under the control of the holding company.
40. It should be pointed out that the Commission’s complaint does not allege the incorrect application of Directive 91/440 and Directive 2001/14, but rather the incomplete transposition of those acts of EU law. Moreover, the Commission has not provided specific evidence showing that the requirement of independence of the entity entrusted with essential functions is not met in practice.
41. In my opinion, the fact that, at present, some people sit at the same time on the organs of PKP SA and of rail carriers, but such a situation does not exist vis‑à‑vis PLK SA militates in favour of the Republic of Poland’s view that the Polish Treasury ensures the independence of the infrastructure manager in connection with decisions on appointments within the organs of the PKP group. It should be added that the Treasury holds 100% of the shares in PKP SA, the group’s parent company, and that the Minister responsible for Transport presents to the general meeting of PLK SA the list of his candidates for the supervisory board. These governance models dispel the suspicion that PKP SA as the parent company can, by controlling the management of PLK SA, compromise the independence of the infrastructure manager.
42. As regards the Commission’s claims relating to the inapplicability and the alleged ineffectiveness of, first, the Law on the suppression of unfair competition within groups of companies and, second, Article 100 of the Labour Code, for the purposes of protecting the independence of the infrastructure manager, I consider that the Commission has not been able to show that the explanations given by the Republic of Poland are incorrect in this regard.
43. Moreover, following the reasoning I adopted in Commission v Austria, it does not appear to me to be consistent, in the present case, to require, as the Commission does, a Member State to adopt additional rules where the parties concerned do not comply, ex hypothesi, with existing legal obligations under the general legislation adopted by the Member State to protect the independence of the subsidiary. (13) An action for failure to fulfil obligations cannot be based on the simple assumption that the infrastructure manager’s senior management and directors are likely to infringe the statutory provisions, requiring the Member State concerned to adopt more detailed specific rules.
44. In the light of the foregoing, I propose that the Court reject the Commission’s first complaint.
B – The second complaint, concerning a continued absence of financial balance
1. Arguments of the parties
45. The Commission complains that the Republic of Poland has not taken measures to ensure, in sufficient time, the financial balance of the infrastructure manager, namely PLK SA. This failure to act therefore constitutes a breach of its obligations under Article 6(1) of Directive 2001/14, in conjunction with Article 7(3) and (4) of Directive 91/440. The Commission states that it is clear from the Polish Government’s reply to the reasoned opinion that expenditure and income were not balanced until 2012.
46. The Republic of Poland claims that the infrastructure manager’s financial balance has been achieved if account is taken of earnings before amortisation. Article 6(1) of Directive 2001/14 certainly does not provide that financial balance must be achieved with the inclusion of amortisation costs, and in particular those for railway lines which are being or will be liquidated in future, with the result that possible renovation costs have not been taken into consideration in setting the infrastructure access charges.
2. Examination of the second complaint
47. I would point out, first of all, that the present complaint raised by the Commission is largely the same issue as that which was dealt with in connection with the second complaint in Commission v Portugal. (14)
48. In Commission v Portugal, however, the Commission’s complaint concerned an infringement of Article 7(3) of Directive 91/440 and Article 6(1) of Directive 2001/14 resulting from the fact that the Portuguese Republic had not taken the measures needed in order to comply with the obligations laid down in those articles. Those provisions require Member States to lay down conditions to ensure that the accounts of the infrastructure manager balance. As I explained in my Opinion in that case, (15) it was clear from the explanations provided by the Portuguese Government in response to the Commission’s second complaint that, despite the obligations laid down in national law to that effect, the Portuguese Republic had not taken the measures needed in order to comply with the obligations laid down in Article 7(3) of Directive 91/440 and Article 6(1) of Directive 2001/14 on expiry of the period laid down in the reasoned opinion.
49. In the present case, on the other hand, the Republic of Poland claims that it provided the railway infrastructure manager with sufficient financing in an increasing amount, whilst the accounting imbalance identified by the Commission can be explained by the amortisation costs for the infrastructure, in particular the lines to be liquidated. The Republic of Poland therefore advocates an interpretation of Article 6(1) of Directive 2001/14 according to which that provision requires the Member State not to balance profit and loss accounts, but only to provide the necessary financing so that earnings before amortisation are balanced.
50. The central issue is therefore the interpretation of this latter provision. First of all, the Commission does not deny that the Republic of Poland has provided financing to improve the economic and financial position of the infrastructure manager and took measures to that effect. Nevertheless, the Commission asserts that that financing was not sufficient having regard to the measures to remedy the causes of the financial imbalance on a sustainable basis, such as the abolition of sections of non-profitable railway links.
51. Secondly, it should be noted that, in the recast of the first railway package proposed by the Commission in 2010, (16) the Commission envisages merging paragraphs 3 and 4 of Article 7 of Directive 91/440 into a new provision corresponding to paragraph 3 of Article 8 of the amended text. Furthermore, Article 6(1) of Directive 2001/14 would be moved, with several amendments, to paragraph 4 of Article 8. (17)
52. The draft Article 8(4) of the recast directive, in the version adopted by the Parliament at second reading on 3 July 2012, reads as follows:
‘Member States shall ensure that, under normal business conditions and over a reasonable period which shall not exceed a period of five years, the profit and loss accounts of an infrastructure manager shall at least balance income from infrastructure charges, surpluses from other commercial activities, non-refundable incomes from private sources and State funding on the one hand, including advance payments from the State, where appropriate, and infrastructure expenditure, on the other hand.’ (18)
53. It is thus clear that, if the abovementioned provision entered into force, it is the profit and loss account that should be balanced. As EU law stands at present, however, the question is whether that is already the case under Directives 2001/14 and 91/440. Irrespective of the position which might be adopted in this regard, the wording of the provisions in question is not unambiguous.
54. I would point out, first of all, that unlike the EU accounting directives (see, for example, Directive 78/660/EC), (19) which use the terms ‘coût’ (‘cost’), ‘charge’ (‘charge’), and even ‘frais’ (‘expenses’) (but not ‘dépenses’ (‘expenditure’)), Article 6(1) of Directive 2001/14 employs the notion of ‘dépenses d’infrastructure’ (‘infrastructure expenditure’). (20) Even though this a simple terminological choice without any major repercussions, it shows, in any event, that the accounting terminology used for Article 6(1) of Directive 2001/14 does not adhere rigorously to the uniform nomenclature.
55. Furthermore, the notion of ‘advance payments’ (Article 6(1) of Directive 2001/14), which is now, in the recast, ‘advance payments from the State’ (Article 8(4) of the recast directive), creates uncertainty as to the scope of the Member States’ obligation under Article 6(1), since the balance of the profit and loss account does not depend on the time of payment of the sum in question. The payment of an ex ante or ex post State subsidy does not therefore affect the balance of the profit and loss account in so far as the aid in question must be taken into account under the financial year for which it is granted, regardless of when it is paid. (21) For that reason, the reading of Article 6(1) of Directive 2001/14 proposed by the Republic of Poland to the effect that the obligation to balance accounts is intended to protect not the accounting balance but the liquidity of the manager does not appear to be unfounded.
56. However, despite the merit of these arguments, I consider that the Member State’s obligation to ‘lay down conditions … to ensure that … the accounts of an infrastructure manager shall at least balance’ income and infrastructure expenditure must be interpreted as referring to an accounting balance of the profit and loss account.
57. If a different interpretation were adopted, the provision in question would not have its own specific scope vis-à-vis paragraphs 3 and 4 of Article 7 of Directive 91/440, which refer, first, to State financing consistent with the tasks, size and financial requirements of the infrastructure manager and, second, to the duty for the infrastructure manager to draw up a business plan ensuring financial balance within the framework of general policy determined by the State. It would thus appear that these provisions seek to guarantee the liquidity of the infrastructure manager, whilst, despite its drafting flaws, Article 6(1) of Directive 2001/14 has in view balanced accounts.
58. I would also point out that amortisation corresponds to the loss in value of the capital stock due to wear or to the obsolescence of the infrastructure, as it is entered in the profit and loss account in the form of annual accounting costs, with a view to increasing the specific financing needed for replacement investments at the end of the useful life of the infrastructure. Thus, under Article 35(1)(b) of Directive 78/660, ‘[t]he purchase price or production cost of fixed assets with limited useful economic lives must be reduced by value adjustments calculated to write off the value of such assets systematically over their useful economic lives’. The entry of amortisation of assets constitutes an accounting obligation without which the annual accounts of a capital company like PLK SA cannot give a true and fair view of the company’s assets, liabilities, financial position and profit or loss in accordance with Article 2(3) of that directive.
59. It should be added that the need to write down the value of assets does not depend on whether or not the undertaking intends to renovate a fixed asset. The fact that an undertaking is not able to cover amortisation from its assets shows that its activities do not have a viable and sound long-term basis, since it is not able to finance, from its own income, the investments required to replace its existing physical assets at the end of their useful economic life. The true and fair view of such an undertaking is that of a financially imbalanced company, even if it does not have liquidity problems.
60. For these reasons, the Republic of Poland’s argument that the accounts of the infrastructure manager are balanced, even though the balance of the profit and loss account is not at least neutral on account of the impact of amortisation, must be rejected. However, an imbalance of the profit and loss account of the infrastructure manager is not sufficient, in itself, to conclude that the Member State in question has failed to fulfil its obligations under Article 6(1) of Directive 2001/14. To arrive at such a conclusion, it would also have to be established, in accordance with the very wording of that provision, that the accounting imbalance occurs ‘under normal business conditions’ and ‘over a reasonable time period’.
61. The Commission argues in this regard that if the infrastructure manager accumulates losses at a level equivalent to that indicated by the Polish Government in its reply to the letter of formal notice, it would be impossible to achieve the financial balance referred to in Article 6(1) of Directive 2001/14. According to the Commission, the Member State in question has not accorded the infrastructure manager financing consistent with its tasks, size and financial requirements. It should be borne in mind in that regard that, according to the Polish Government’s reply to the reasoned opinion, the manager will make losses until 2012.
62. According to the figures contained in the application, the manager’s deficit increased from 2% in 2006 to 10% (according to forecasts) in 2009. Over that same period, State funding rose from 10.8% to 19.3% (according to forecasts), whereas coverage of costs by income from infrastructure access charges fell in parallel from 79.4% in 2006 to 64.4% in 2009 (according to forecasts).
63. The Republic of Poland claims, however, that it is forecast that in 2015 the State will cover expenditure linked to the infrastructure at a level of 37.5%, which, it states, will result in an appreciable drop in the level of charges for rail carriers.
64. In its rejoinder, the Republic of Poland states that, in its reply to the reasoned opinion, it presented the government plan providing for an increase in financing for the infrastructure manager, the objective of which is to balance the budget in 2012. In addition, the Member State in question also envisages balancing the budget for PLK SA at the income and expenditure planning stage. Whilst stating that the final result will depend on developments, the Republic of Poland points out that in 2009 there was a 17% fall in the volume of goods rail transport recorded compared with the previous year.
65. I would note in this regard that the current wording of Article 6(1) of Directive 2001/14 does not offer any clarification of the application of the criterion of a ‘reasonable time period’, which, according to the abovementioned recast of the first railway package, may not exceed a period of five years. It is apparent from the documents before the Court that the Republic of Poland granted the first subsidy of PLN 340 million to PLK SA in 2006, after the manager had commenced its activities. The annual State subsidy was increased to PLN 900 million in 2010, and to PLN 1 200 million in 2012, the year in which financial balance was to be achieved. Lastly, over the following years, that subsidy is due to increase by PLN 100 million each year.
66. According to the information in the case-file, the Polish rail network is very dense, in poor condition and largely not very profitable. As I have stated, the independent management of the railway infrastructure began only recently, the first State subsidy having been granted in 2006. At the same time, despite the repeated grant of funding from the Polish State to the infrastructure manager, its income has fallen, partly because of the major economic crisis faced by the European Union. The Polish State’s financial planning nevertheless envisages balancing the budget in 2012.
67. Taking into account these elements, and unlike the situation of the Portuguese Republic which was the subject of my Opinion in Commission v Portugal, cited above, it does not seem possible to state that the Republic of Poland has not laid down conditions to ensure that, under normal business conditions and over a reasonable time period, the accounts of the infrastructure manager at least balance income and infrastructure expenditure.
68. In the light of the foregoing, I propose that the Court reject the Commission’s second complaint.
C – The third complaint, concerning the absence of incentives for infrastructure managers
1. Arguments of the parties
69. The Commission claims that, by not introducing, in accordance with Article 6(2) and (3) of Directive 2001/14, an incentive scheme to encourage the manager to reduce the costs and charges for the use of the infrastructure, the Republic of Poland has failed to fulfil its obligations under those provisions. The Commission argues, in particular, that Article 38a of the Law on rail transport does not create an incentive scheme to encourage the manager to reduce the costs of provision of infrastructure and the level of access charges.
70. As a preliminary point, the Republic of Poland claims that Directive 2001/14 lays down the obligation for the Member States to introduce incentives with a view to increasing the efficiency of managers without, however, defining the nature of those measures. The Republic of Poland nevertheless argues that the Minister responsible for Transport decides each year, together with PKP SA, which is wholly controlled by the Treasury, to give rewards to board members of companies in order to increase the efficiency of the manager. In addition, the Republic of Poland argues that other corporate governance instruments are applied to PLK SA.
71. The Czech Republic claims that the requirement of incentives to reduce the costs of provision of infrastructure and the level of access charges represents the ultimate objective of Article 6(2) of Directive 2001/14, that is to say a state which must be achieved. As that provision expressly stipulates, it is necessary to create the preconditions for this. Thus, in seeking to attain that objective, the Member State must have due regard to safety and to maintaining and improving the quality of the infrastructure service.
72. According to the Czech Republic, in a situation where the infrastructure is very poorly maintained, those conditions are not met. Consequently, the conclusion of an agreement between the State and the infrastructure manager on the financing of the costs of repairing or maintaining the infrastructure is a measure which is intended to achieve the ultimate objective laid down in Article 6(2) of Directive 2001/14 and which must be regarded as sufficient having regard to the specific requirements relating to the condition of the infrastructure.
73. In its reply to the statement in intervention submitted by the Czech Republic, the Commission claims that such an interpretation of Article 6(2) of Directive 2001/14 is incorrect. In its view, that provision does not make the obligation to introduce incentives dependent on the condition of the railway infrastructure. Such an obligation on the Member State exists in its own right. Thus, the conclusion of an agreement between the State and the infrastructure manager on the financing of the costs of repairing and maintaining the infrastructure which does not include incentives for the manager to reduce the costs of provision of infrastructure and the level of access charges does not satisfy the obligation laid down by that provision.
2. Examination of the third complaint
74. I would point out, first of all, that the Commission’s third complaint concerning the absence of incentives for the infrastructure manager to limit the costs of provision of infrastructure or the level of access charges is essentially identical to the third complaint in Commission v Germany, cited above. (22) For that reason, I refer to the legal reasoning adopted in that Opinion.
75. As regards the Polish legislation and its implementation, there are, however, significant differences compared with the situation in Germany. Consequently, my conclusion that the complaint raised against the Federal Republic of Germany must be rejected cannot automatically be applied to the case of the Republic of Poland.
76. 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’.
77. However, Article 6(3) of Directive 2001/14 envisages two distinct 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.
78. I would point out, first of all, that Article 38a(1) and (2) of the Law on rail transport seems to provide an appropriate legislative framework for the implementation of the obligations under Article 6(2) and (3) of Directive 2001/14. Those provisions define the competent authority (the Minister responsible for Transport), the instrument available (State funding), the objective (to reduce expenses and the amount of the charges for use) and the form taken by the measures in question (a multiannual agreement).
79. However, the abovementioned legislative provisions do not seem sufficient in themselves to transpose the obligations laid down in Article 6(2) and (3) of Directive 2001/14. They do not define the incentive mechanism establishing the causal link between the economic objectives to be achieved by the infrastructure manager and the measures taken by the Minister responsible for Transport to finance the costs of renovating and maintaining the railway infrastructure.
80. In addition, it should be stated that those national provisions also do not establish appropriate regulatory measures with adequate powers for the infrastructure manager to report on its management to a competent authority, such as the President of the ORT, in accordance with Article 6(3) of Directive 2001/14. However, it seems to be common ground in this connection that the Polish legislature opted to conclude a multiannual agreement.
81. In its written pleadings, the Republic of Poland mentions several examples of measures which it regards as incentives for the infrastructure manager’s board members and directors to increase its efficiency. The Republic of Poland also mentions instruments for corporate governance and financing of the infrastructure manager.
82. Nevertheless, it seems to be established that the Republic of Poland does not claim that, even assuming that they may be regarded as incentives, the measures which it describes in its defence and in its rejoinder are included in a multiannual funding agreement within the meaning of Article 6(3) of Directive 2001/14. A parallel should be drawn in this regard with the service and funding agreement (‘Leistungs- und Finanzierungsvereinbarung’) concluded between the Federal Republic of Germany and DB Netz, which defines a set of measures which seem to satisfy the requirements laid down in paragraphs 2 and 3 of Article 6 of Directive 2001/14. (23)
83. Lastly, with regard to the arguments put forward by the Czech Republic, it need only be stated that the Member States’ obligations under Article 6(2) and (3) of Directive 2001/14 do not depend on the condition of the infrastructure. That being the case, it is evident that the choice of incentives to be adopted, and more specifically the specific objectives pursued by the Member State through those measures, depends on the requirements relating to safety and the quality of the infrastructure service. Thus, in applying Article 6(2) and (3) of that directive, the Member States are required to take into consideration the condition of the infrastructure, which does not in any way release them from the obligation to conclude multiannual funding agreements which include incentives or to establish a regulatory framework for that purpose.
84. In the light of the foregoing, I conclude that the Commission’s third complaint should be upheld.
D – The fourth complaint, concerning the calculation of the charge for minimum access
1. Arguments of the parties
85. The Commission claims that the Republic of Poland has failed to fulfil its obligations under Articles 7(3) and 8(1) of Directive 2001/14. It claims that the notion of ‘cost directly incurred as a result of operating the train service’ within the meaning of Article 7(3) of that directive refers to the notion of ‘marginal cost’. In the view of the Commission, ‘marginal cost’ corresponds only to the costs generated by actual train movements, and not to the fixed costs which cover, in addition to the costs connected with railway operation, overhead costs for the operation of the infrastructure which must be borne even in the absence of train movements.
86. In addition, the Commission argues that, in its reply to the reasoned opinion, the Republic of Poland acknowledged that the level of the unit rates for the basic charge for minimum access to the infrastructure depended on planned operation works, the proposed cost of provision of the railway infrastructure in the context of minimum access, and the planned financing of repairs and maintenance of the railway infrastructure. However, in the view of the Commission, these factors are not directly linked to the direct costs stemming from the operation, but are intended to recover all the costs incurred by the manager.
87. As regards the possibilities for mark-ups of charges on the basis of Article 8(1) of Directive 2001/14, the Commission argues that, on a combined reading of the first and second paragraphs of that provision, the Member States are required to introduce a supervisory mechanism covering all market segments for rail carriers and their payment capacities. According to the Commission, Directive 2001/14 allows the Member States to introduce a mechanism identifying ‘market resilience’ and to monitor that certain sectors of the market which could thus far pay the charge for minimum access to the infrastructure are not excluded. However, the Law on rail transport does not establish mechanisms for checking that all market segments required to cover direct costs have the capacity to bear a mark-up of charges with a view to recovering the costs incurred by the infrastructure manager (i.e. costs other than direct costs).
88. As regards, first, the complaint concerning the infringement of Article 7(3) of Directive 2001/14, the Republic of Poland argues that the Law on rail transport was amended during the pre-litigation procedure, in accordance with the requirements laid down by the Commission. In particular, Article 33 of the Law on rail transport provides that the basic charge for the use of the railway infrastructure is set in the light of the cost borne by the manager directly as a result of train movements made by the rail carrier.
89. Furthermore, the Republic of Poland challenges the Commission’s complaint that, under the Polish legislation, the costs directly incurred as a result of operating the train service correspond to overall maintenance costs and overall operating costs. The Republic of Poland argues that the Commission’s claim that the notion of ‘cost directly incurred as a result of operating the train service’ refers to the notion of ‘marginal cost’ is unfounded. It points out in that regard that, because Directive 2001/14 does not define ‘cost directly incurred as a result of operating the train service’, the Member States enjoy a degree of freedom, having regard to the objectives of that directive, in defining the constituent elements and inferring from them the amount of the access charge.
90. As regards, second, the complaint concerning the infringement of Article 8(1) of Directive 2001/14, the Republic of Poland claims that the Commission has not explained on what basis, in the light of the provisions in force in Poland, it found that the costs taken into consideration in calculating the charge for minimum access were marked up by the rate of return mentioned in Article 8(1) of Directive 2001/14.
91. The Czech Republic argues with regard to the Commission’s complaint concerning the incorrect transposition of Article 7(3) of Directive 2001/14 that it certainly does not follow from that provision that only marginal costs can be classified as ‘cost[s] directly incurred as a result of operating the train service’. According to that Member State, since neither Directive 2001/14 nor any other provision of EU law sets out the costs covered by that notion, the crucial criterion is only whether it can be shown that such costs have a direct link with the operation of the train service.
2. Examination of the fourth complaint
92. I would point out, first of all, that I have already taken a view on the interpretation of the expression ‘cost directly incurred as a result of operating the train service’ in my Opinion in Commission v Czech Republic. (24) Consequently, in responding to the present complaint raised by the Commission, I will simply make reference to that Opinion, without reproducing in full the arguments set out therein.
93. As regards the interpretation of the notion of ‘cost that is directly incurred as a result of operating the train service’, I suggested to the Court that because Directive 2001/14 is imprecise and there is no precise definition of that notion or provision of EU law setting out precisely the costs not covered by that notion, the Member States enjoy a certain economic margin of discretion in transposing and applying that notion. In view of the extremely technical nature of this issue and the different expert studies to establish a common definition and methodology within the European Union, the Court is not in a position to offer any helpful clarification in this regard. In particular, there seems little point in attempting to clarify the legal meaning of this notion in EU law, when it is an economic science notion whose application raises considerable practical difficulties.
94. Nevertheless, even though it does not seem possible to define exhaustively what is and what is not covered by the notion of ‘cost that is directly incurred as a result of operating the train service’, the fact remains that the Member States may, in some cases, include costs which manifestly go beyond the limits of the notion used by Directive 2001/14. Within the framework of infringement proceedings, it must therefore be ascertained whether the legislation of the Member State in question permits the inclusion in the calculation of the charges for the minimum access package and track access to the railway infrastructure of items which are manifestly not directly incurred as a result of operating the train service.
95. As regards the transposition of the requirement under Article 7(3) of Directive 2001/14 that the amount of the charge be limited to the cost that is directly incurred as a result of operating the train service, the Polish legislation seems to me to include all the necessary elements for the infrastructure manager and the regulatory authority to be able to set the charges in accordance with that requirement.
96. I wish to point out in this regard that under Article 33 of the Law on rail transport the basic charge for the use of the railway infrastructure is set taking into consideration the cost, borne by the manager, directly incurred as a result of operating the train service (paragraph 2); the charge for the use of the railway infrastructure is composed of the basic charge and additional charges (paragraph 3); in connection with the basic charge, the manager must apply a separate charge for minimum access to the railway infrastructure (25) (paragraph 3a(1)); the basic charge for minimum access to the railway infrastructure is determined as the product of the train movements and the unit rates set according to the category of railway line and type of train, separately for passenger transport and goods transport; the manager may apply a minimum unit rate for the basic charge for minimum access to the railway infrastructure. The minimum rate applies on an equivalent basis to all passenger rail carriers for the use of the railway infrastructure in connection with activities performed under the public service agreement (paragraph 4a); (26) the basic charge for access to equipment connected with train maintenance is calculated as the product of the services ordered and the corresponding unit rates, the amount of which varies according to the type of services referred to in Part I(2) of the Annex to the Law on rail transport (paragraph 4c); and the unit rate for the basic charge for minimum access to the railway infrastructure is set per train, per kilometre travelled (paragraph 5).
97. The legislation is clarified by more detailed provisions laid down in the regulation of the Minister for Infrastructure on conditions for access (‘the ministerial regulation’). (27) The provisions contained in Articles 6 and 7 of that regulation define the methods for calculating the basic charge referred to in Article 33(4) of the Law on rail transport and the unit rates for the basic charge.
98. Furthermore, under Article 8(1)(1) to (4) of the ministerial regulation, in calculating the rates for provision of the railway infrastructure, the infrastructure manager must take into consideration direct costs, which cover maintenance costs, rail traffic management costs and amortisation. In addition, the manager must also take into consideration the indirect costs of the activity, covering the reasonable expenses of the infrastructure manager other than the abovementioned costs, financing costs relating to the repayment of loans taken out by the manager to develop and modernise the available infrastructure and operational work defined for the different categories of lines and trains. Under Article 10 of the regulation, ‘the minimum rate referred to in Article 33(4a) of the Law [on rail transport] may be no lower than 75% of the rate set for a given category of railway line and total gross train weight’.
99. As I pointed out in my Opinion in Commission v Czech Republic, cited above, the Commission’s approach is based on an excessively strict interpretation of Article 7(3) of Directive 2001/14. The costs connected with signalling, traffic management, maintenance and repairs may vary, at least partially, depending on traffic and, accordingly, may be considered to be directly incurred as a result of operating the train service.
100. However, under the Polish sub-legislative rules, in determining the charge for the minimum access package and track access to service facilities, it would seem to me that costs which manifestly cannot be considered to be directly incurred as a result of operating the train service must be included.
101. Thus, the maintenance or traffic management costs mentioned in Article 8 of the ministerial regulation may be considered to be only partially directly incurred as a result of operating the train service, because they include fixed costs which must be borne by the manager after a stretch of line on the rail network has been made available to traffic, even in the absence of train movements. As regards financing costs, also mentioned in that provision, such a relationship seems to me to be completely absent. It should be added that the ministerial regulation permits the inclusion of amortisation in the calculation of access charges, but the Polish Government stated, in connection with the second complaint, that that was not the case in practice. (28)
102. Thus, in the light of the foregoing, I conclude that an infringement of Article 7(3) of Directive 2001/14 by the Republic of Poland may be accepted.
103. On the other hand, the Commission’s complaints concerning the infringement of Article 8(1) of Directive 2001/14 cannot be upheld. The Member State in question disputes that it exercised the option under that provision, which permits mark-ups to be levied on access charges. I consider that the Commission has not been able to refute that claim.
104. Furthermore, Directive 2001/14 does not require the Member States to establish, by law or regulation, a specific method for assessing ‘market resilience’. It is true that the Member States must adopt an appropriate regulatory framework so that the infrastructure manager may assess, within the scope of its management independence, ‘if the market can bear’ a mark-up of charges pursuant to Article 8(1) of that directive. However, as I pointed out in my Opinion in Commission v Germany, the same directive confers on the infrastructure manager, with regard to charging, a role that includes choices requiring discretion inter alia in the methods to be applied. (29)
105. For those reasons, I consider that the Commission’s fourth complaint must be upheld in so far as the Republic of Poland permitted the inclusion in the calculation of charges for the minimum access package and track access to the railway infrastructure of costs which cannot be regarded as costs directly incurred as a result of operating the train service within the meaning of Article 7(3) of Directive 2001/14. Consequently, I propose that the Court reject the Commission’s fourth complaint as to the remainder.
V – Costs
106. Under Article 138(3) of the Rules of Procedure of the Court of Justice, (30) 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 Republic of Poland have failed on several heads, I propose that each party bears its own costs.
107. In accordance with Article 140(1) of the Rules of Procedure, the Czech Republic and the Italian Republic, which were granted leave to intervene in the present case, are ordered to bear their own costs.
VI – Conclusion
108. In the light of the foregoing, I propose that the Court:
(1) declare that the Republic of Poland has failed to fulfil its obligations
– under Article 6(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, as amended by Directive 2004/49/EC of the European Parliament and of the Council of 29 April 2004, by not introducing incentives for the railway infrastructure manager to reduce the costs of provision of infrastructure and the level of access charges, and
– under Article 7(3) of Directive 2001/14, as amended by Directive 2004/49, by permitting the inclusion in the calculation of charges for the minimum access package and track access to the railway infrastructure of costs which cannot be regarded as costs directly incurred as a result of operating the train service;
(2) dismiss the action as to the remainder;
(3) order the European Commission, the Republic of Poland, the Czech Republic and the Italian Republic to bear their own costs.