“In the preliminary assessment of the Competition Council, the planned changes would limit the companies’ ability to enter the market of passenger transport services and in the longer term this would negatively affect competition, as a result of which consumers would be harmed, as they would not be able to get quality services at the best price,” the council’s report states.
The council was struck by proposals to issue only one permit to one carrier to transport passengers on a long-distance route, as well as to separate existing and new routes, but to leave the provision that their routes do not overlap by more than 50 percent.
According to the council, it is the latter requirement that would make it difficult for a new entrant to enter the market.
The Competition Council states that it supports the proposal of the Ministry of Transport to evaluate alternatives that would not or less restrict competition, as well as to receive the Government’s conclusion.
The council told BNS that the ministry suggested considering the possibility of providing additional criteria for a carrier applying for a permit to transport passengers on a certain route – for example, that the departure time in the schedule does not coincide with the time of carriers already holding permits by less than 30 minutes. It was also suggested that all the municipalities it would cross would approve the route of the new route in writing.
According to the council, the ministry also asked whether the amendments proposed by the Seimas committee should eliminate some routes, if permits to transport passengers have already been issued to several carriers.
“In its letter, the Competition Council did not comment on the appropriateness of specific alternatives – we might assess them following familiarizing ourselves with the specific proposed models, their impact on competition and assessing proportionality,” the council said to BNS.
The amendments to the Code that came into effect on July 1 last year restructured the long-distance bus market. Among the essential changes, buses must be no older than 14 years, and from 2026 – 10 years old.
It was hoped that the redevelopment would help attract new entrants to the market, thereby promoting competition which the council said was lacking in the business.
However, in a discussion held in the Seimas committee in January, the representatives of the municipalities said that the reform, which was supposed to promote competition, did not fundamentally change anything, and the situation is only getting worse.
Dovilė Sujetaitė, advisor of the Association of Lithuanian Municipalities (LSA), said at the time that some bus routes were canceled in some regions following the reform began.
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2024-07-08 05:57:09
