Frontier provided economic insight to one of Chile’s leading freight operators, in response to a proposed change to rail access tariffs that raised questions over competition.
Analysing the economic implications of rail access changes
In Chile, rail infrastructure access is negotiated between the infrastructure manager, Empresa de los Ferrocarriles del Estado (EFE), and the operators of rail services. In early 2023, EFE proposed to introduce a new access tariff model for freight operators, altering both the fee structure and overall charges.
To evaluate the fairness and competitiveness of these changes, Ferrocarril del Pacifico (FEPASA), a major freight operator in Chile, commissioned Frontier to provide independent economic analysis.
Our work included:
- Assessing the proposed access conditions and their alignment with principles of economic competition and regulation.
- Comparing Chile’s institutional framework with best practices in European countries.
- Helping FEPASA understand the economic implications of the proposed tariff model.
Ensuring competition through international insights
Frontier’s analysis identified areas where the new access conditions might impact economic competition. By benchmarking EFE’s model against European frameworks, we provided FEPASA with clear insights into how the proposed changes align – or diverge – from international standards.
This comparative approach highlighted opportunities to strengthen the tariff model, ensuring fair competition while supporting the efficiency of rail freight operations.
Guiding improved regulation and fair outcomes
Our analysis will enable FEPASA to understand the economic and competitive implications of the proposed changes. This work will support the operator’s ongoing discussions with EFE.
More broadly, our work will help to improve regulatory practices within Chile’s rail sector. By offering insights grounded in international best practices, the project seeks to pave the way for fairer conditions, benefitting both operators and the infrastructure manager.
If you’re interested in finding more about how we explored these issues and how we helped our client, please contact media@frontier-economics.com or call +44 (0) 20 7031 7000.
