Competition Commission to investigate rolling stock leasing
The UK's Office of Rail Regulation (ORR) has today referred the market for the leasing of rolling stock for franchised passenger rail services to the Competition Commission (CC) to conduct a market investigation under the terms of the Enterprise Act 2002.
The reference follows ORR's preliminary investigation of the rolling stock market, which identified a number of possible issues, including the liquidity of the market (and the availability of surplus rolling stock), institutional matters relating to the franchising process for Train Operating Companies (TOCs), and lack of transparency in the terms for the provision of heavy maintenance to leased rolling stock. In addition the ORR considered that there was some evidence to suggest excess profitability in the sector, although this evidence was not conclusive.
The CC will investigate these issues in detail of the course of the next two years. It has the power to apply remedies to correct any defects that it identifies in the functioning of this market.
Frontier (London) is advising HSBC Rail.
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