Comment: Inquiry into Public Transport (May 2018)

Comment: Inquiry into Public Passenger Transport (May 2018)

 

In May 2017, the Competition Commission (established under section 43B of the Competition Act of 1998) published notice of its intention to conduct a Market Inquiry into land-based public passenger transport.

According to the Competition Commission website:

The Commission initiated the Inquiry because it has reason to believe that there are features or a combination of features in the land based public passenger transport sector that may prevent, distort or restrict competition within the sector; and to achieve the purposes of the Act.

Note that the Market Inquiry is into issues in the industry that impact on competition and the end result will be recommendations regarding changes that will support competition in the industry.  A Market Inquiry does not imply corrupt activities such as price fixing, but rather a possibility or probability of non-optimum market forces and processes.

The Terms of Reference (ToRs) as gazetted covered the following:

  1. The ToRs broadly outline the following themes to be considered by the Inquiry:

1.1  Price setting mechanisms: the Inquiry analyses different price setting mechanisms and their impact on competition in the land based public passenger transport industry;

1.2 Price regulation: the Inquiry examines applicable price regulations and their impact on competition in the land based public passenger transport industry;

1.3 Route allocation, licensing and entry regulations: the Inquiry assesses the impact of regulations, including route allocation, licensing and entry requirements on intermodal and intramodal competition in the land based public passenger transport industry;

1.4 Allocation of operational subsidies: the Inquiry assesses the impact of operational subsidies granted to commuter buses, Metrorail and Gautrain on intramodal and intermodal competition in the land based public passenger transport industry;

1.5 Transport Planning: the Inquiry evaluates the impact of government’s transport plans on dynamism, efficiency and competition in the land based public passenger transport industry; and

1.6 Transformation: the Inquiry assesses transformation issues, including ownership patterns in the land based public passenger transport industry.

Public hearings on the matter started on the 4th June 2018 and will continue until the 31st August. 2018.  The Commission’s Call for Submissions calling for  comment is availablehere:

TransForum made two (2) written submissions and one (1) oral submission. These were:

Written submissions

Paul Browning: Browning Competition Commission Submission May 2018

Shelley Childs:  Childs Competition Commission Submission May 2018

 

Oral submission

On the 4th of July 2018, Paul Browning also made an oral submission to the commission. The transcript of the day is available here:. Paul’s comments start around page 60.

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