Brussels, 24/06/2002 (Agence Europe) - On Monday the European Commission authorised the acquisition of two London Tube infrastructure companies by Metronet, a consortium controlled by Atkins, RWE, Balfour Beatty and Seeboard. The deal, part of a restructuring of the London Underground, does not raise any competition concerns but, nevertheless, examines the UK Government's request for confirmation that the operation does not involve state aid.
The UK Government, a few years ago, decided to reorganise the way the London Underground is funded and run and created a number of so-called Public Private Partnerships (PPP) under which private operators were invited to put in bids for upgrading the Underground infrastructure. The operation of the trains remains the responsibility of the London Undergroung Plc, a state-owned body which runs the trains. As a result of the public bidding process, Metronet has acquired two infrastructure companies: Infraco SSL and Infraco BCV from London Underground (LUL).The Metronet consortium has five shareholders: WS Atkins Plc, a UK company, which provides technologically based consultancy, management of outsourced facilities and support services. Balfour Beatty, a UK civil engineering company active in the rail and engineering services sector. SEEBOARD, a UK supplier and distributor of electricity and gas. Canadian aircraft maker Bombardier, which also makes rail transportation equipment. And Germany's RWE.
The Infracos will be required to maintain, upgrade and replace the trains and other infrastructure of the London Underground in return for which they will receive an « Infrastructure Service Charge » from LUL, in accordance with the service provisions set out in the 30 years service contract which exists between LUL and the Infracos. Metronet will lease the existing assets, and upgrade, maintain and/or replace them during the PPP, before returning the assets to LUL after the 30 years duration of the PPP. Due to the features of the London underground each Infraco manages a different series of lines. Infraco SSL (Sub Surface Lines) covers the Metropolitan, District, Circle, Hammersmith and City and East London lines, as the same trains can run on more than one of these lines. Infraco BCV (Bakerloo, Central, Victoria and Waterloo and City line) covers the latter lines, which are separate deep tunnel lines.The Commission defined the market as the supply of composite infrastructure services to London Underground and found that there were no horizontal or vertical anti-competitive negative effects. Its analysis of the vertical relationships between the Infracos and the shareholders, as potential suppliers of underground rolling stock, signalling and track services, also showed that there were no significant competition concerns. The Commission has, therefore, decided to authorise the operation