Requirements that a carrier must meet to be able to undertake a cabotage journey

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Read previous: Road freight cabotage in EU

The adoption of Regulation (EC) No 1072/2009 has removed national interpretations of the previous rules and thus increased stability in the market.
The new Regulation has defined clearly the temporary nature of cabotage by introducing quantitative criteria (the “3 operations in 7 days” rule) to define the scope for this type of operation, making the monitoring and enforcement of cabotage rules simpler.

This has also been facilitated by linking international cabotage to international carriage operations, not included previously, and unified documentation requirements that were previously very diversified across the EU and often created a high barrier to entry for carriers from foreign Member States.

Nevertheless there are still areas that need improvements, especially in relation to the interpretation of current rules and enforcement. The first relate to partial unloading of cabotage operations (multidrops), which are dealt with differently in different MSs. As far as enforcement is concerned, each MS has adopted a different approach to monitoring, enforcing and sanctioning infringements which make illegal cabotage operations more or less risky depending on the country where it is undertaken. For example, fines can vary from a minimum fine of €100 in Hungary to a maximum fine of €200,000 in Germany. Moreover, often the enforcement bodies across Europe lack the resources to monitor and enforce the cabotage provisions effectively because there is little national and international cooperation among the authorities in charge of monitoring and enforcing the requirements of the Regulation.

In addition to unified regulation, some countries still have their own requirements.
In France cabotage operations may only be carried out as part of an international journey, with the same truck as was used for the international transport journey or with the same truck tractor in the case of multiple vehicles. When the final destination of the international journey is France, road cabotage operations are allowed once all of the freight being transported internationally has been unloaded. A maximum of three cabotage operations, with three separate waybills, are allowed. The three cabotage operations must be done within seven days of unloading of the internationally transported freight. If the final destination of the preceding international journey is a country other than France, a maximum of one cabotage operation in France is authorised within the three days following entry of the empty vehicle into the country. The cabotage operation must be completed within seven days of the unloading of the internationally transported freight. All drivers of vehicles used in a cabotage operation must have the following documents in their possession: an international waybill (CMR) for the preceding international journey, which qualifies the vehicle to carry out a cabotage operation; a waybill (WB) for each cabotage operation carried out. In addition to the standard compulsory information, each of the aforementioned documents must include: the date that the freight was unloaded; the registration number for the vehicle used for the cabotage operation. This information may be filled in by hand. Road freight transport cabotage activity is also checked through verification of the information recorded in the tachograph and the information pertaining to freight loading. Company vehicles that fail to abide by the cabotage regulation may be impounded until infringement has ceased and may be liable for a fine of 15,000 €. Transporters of countries that are not authorised for cabotage operations may face up to a one-year prison sentence. Failure to show the required documents or failure to show documents replete with all of the necessary information is punishable by a class 5 fine of up to 1,500 €.

Cabotage in the United Kingdom there is a general tendency to follow the EC Regulations, however The Transport Tribunal recently gave important guidance on the UK operations of non-UK hauliers (Nolan Transport -v- VOSA and The Secretary of State for Transport – T2011/60). Under Section 2 Goods Vehicles (Licensing of Operators) Act 1995, an Operator’s licence is required by those who seek to operate goods vehicles over 3.5 tonnes for hire or reward or in connection with a trade or business on national journeys within the UK. There are many exceptions to that requirement, some of which relate to non-UK hauliers. A non UK-based haulier who holds a Community Authorisation can undertake international carriage, which is a journey: being undertaken by a vehicle where the points of departure and of arrival are in two different Member States, which is from a Member State to a non-Member State, between two non-Member States with transit through one or more Member States or by an unladen vehicle in connection with such carriage. As long as the journey is an international one then no UK “O” licence is required. Non-UK hauliers holding a Community licence and whose driver has a driver attestation where necessary can undertake up to 3 cabotage operations within 7 days of the last unloading of goods carried on an international journey. Such Operators must carry a certified copy of their Community licence, which must be produced when required and can undertake either 1, 2 or 3 such national journeys within the 7-day period but they are limited to one such journey within 3 days of an unladen entry into the UK. Article 8-3 of Regulation 1072/2009 requires as a condition of lawful cabotage that the haulier must produce clear evidence of the incoming international journey and of each consecutive cabotage operation carried out. If such “clear evidence” cannot be produced then the journey is not lawful cabotage and so must be covered by a UK Operator’s licence, without which the Operator is at least liable to a prosecution for using a vehicle without such a licence (maximum fine £5,000) or, depending on circumstances, to the vehicle’s impounding. The “clear evidence” required must comprise the following details for each operation:
(a) The name, address and signature of the sender, the haulier and of the consignee.
(b) The date of delivery once the goods have been delivered.
(c) The place and date of taking over of the goods by the haulier and the designated place of delivery.
(d) The description in common use of the nature of the goods and the method of packing (in the case of dangerous goods, their generally recognised description as well as the number of packages and any special marks).
(e) The gross mass of the goods or their quantity otherwise expressed.
(f) The number plates of the motor vehicle and the trailer.

There can be no cabotage until all the goods on the incoming international journey have been delivered. Important points to note are:

  • A tractor unit travelling without a trailer and journeying between two Member States can come within the definition of “international carriage” but it cannot undertake cabotage operations because it will not have delivered any goods on its incoming journey.
  • Any cabotage must be undertaken by the tractor unit responsible for the international carriage. The cabotage can be carried out with any trailer, i.e. not necessarily the one used to bring the goods into the UK on the international journey, but there can be no substitution of another tractor unit to replace the incoming international carrying tractor unit.
  • Regulation 1072/2009 places the onus of producing “the clear evidence” onto “the haulier”. After a full review of all relevant material, the Tribunal decided that the “clear evidence” must be kept in the vehicle and must be made available for inspection at any roadside check. It is not for the haulier to produce it sometime later and at his convenience.
  • After the completion of a third cabotage journey in 7 days the vehicle must leave the country, unless it can be operated within the terms of any other exemption, such as combined transport.

The Tribunal emphasised the strict interpretation of the relevant rules – “Foreign hauliers who operate outside permitted exemptions increase the risk to the public either because their vehicles are not properly maintained or because they are lax in their observance of drivers’ hours and tachograph regulations, or for both and possibly other reasons.” The UK haulage industry is the first line of any enforcement system because its members have knowledge of unfair competition by businesses not established within the UK. Many successful impounding operations start with a call from a UK haulier or an employee. Do not complain about unfair competition from non UK-based hauliers if you cannot be bothered to call a local VOSA representative or a member of its special investigation teams to report such activity in the first place!

Cabotage In Germany beside all the cabotage rules introduced by Regulation 1072/2009, Article 7a of the German Road Haulage Act17 establishes the requirement for hauliers effecting domestic road transport operations in Germany, to hold liability insurance against the damage of goods carried. The minimum amount of insurance is €600,000 for each claim, and no less than €1.2 million for a year. The haulier has to guarantee that a certificate of this insurance is carried by the driver while carrying out transport operations.

The German Road Haulage Act (GüKG) of 22 June 1998 appoints the Federal
Office for Goods Transport (BAG) as the responsible authority for monitoring compliance with European and National law. The Federal Office and its staff has to investigate infringements of the laws and prosecute these when carrying out the monitoring tasks with the rights and obligations of officials of the police service under the provisions of the Criminal Procedure and the Law on Administrative Offences.
In accordance with Article 19 (5) of the GüKG, administrative offences can be punished
with a fine: up to €200,000 for lack of driver attestation in cross-border haulage and cabotage ; up to €20,000 for undertaking cabotage without holding a Community licence; and up to €5,000 in the remaining cases.

EU enlargement in 2004 had a significant impact on cabotage operations across Europe as it gave the possibility to hauliers from new MS to compete with those of EU15 MS. Pre-accession treaties limited their ability to perform cabotage operations in EU15 Member States by means of a system of temporary restrictions, most of which were lifted in 2009 for those that entered in the EU in 2004. By contrast, Bulgarian and Romanian hauliers were not allowed to perform cabotage in most countries until 1 January 2012.
While it is not possible to assess the exact impact of the Regulation on cabotage trends, it is clear that the opening up of the market to new MSs was one of the major causes of the changes in cabotage volumes across the EU. This can be seen in the data relating to cabotage following the 2009 recession, where cabotage operations carried out by EU12 MSs increased substantially compared to activities of EU15 hauliers.
The entrance of the new Member States into the EU cabotage market introduced new providers of cabotage operations: in 2011 Polish road hauliers carried out the most cabotage operations, surpassing the volumes of German and Dutch hauliers, which used to be among the most active operators before EU enlargement. Overall the proportion of cabotage operations undertaken by vehicles registered in any of the EU12 Member States
increased from 12% in 2007 to nearly 40% in 2011.
By contrast, EU enlargement did not alter the main destination countries for cabotage. The MSs with the highest penetration rates of cabotage activities are still Belgium and Austria, while in terms of total volumes the main destinations are the biggest EU15 economies: Germany, France, Italy and the UK. The increased activity of EU12 hauliers, especially Polish ones, in the recent years can be partially explained by the fact that they can offer lower prices thanks to the lower labour costs in comparison to most EU15 MSs. This cost advantage is attributable to different wage levels (that over the long term should level out), but also to different social protection systems that impose different labour costs on firms from new and old MSs.

Since January 1st, when the next stage in the liberalisation of the European road haulage sector came into existence, Romania and Bulgaria have joined Poland, the Czech Republic, Slovakia, Hungary, Estonia, Latvia and Lithuania who have had the right to

Carry out up to three domestic transport operations in fellow member states over a seven-day period, following an international operation since May 2009. The competitiveness of French, Dutch and German hauliers has come under greater threat now that Eastern European Hauliers from Romania and Bulgaria can operate in the French domestic market under legislations set out in the cabotage enlargement in the EU, according to France’s leading haulage federation, the FNTR. Cabotage has been one of the FNTR’s major concerns for some time. It says France alone accounts for one-third of all cabotage operations in the EU and that more than 40% of trucks on the country’s roads are now foreign-registered. The objections originate from a 2009 EU regulation on road haulage aimed at boosting competition and productivity. Advocates in the European Commission and Parliament said a liberalised cabotage market would help bring down haulage costs but also cut traffic and pollution by reducing the number of transcontinental truckers returning home with empty loads.

It is difficult to decouple the effects of recent reforms to cabotage rules from the effects of the wider economic downturn in Europe. Nevertheless, the analysis undertaken reveals that the presence of such heterogeneous conditions across the EU has had different socio-economic effects in different countries. The analysis in this study shows that, overall, cabotage has put downward pressure on transport costs in several EU15 MSs and has created new business opportunities for EU12 hauliers. This has however been counterbalanced by the reduced profitability of EU15 operators, safety concerns and the potential of driver shortages going forward.

All these factors are likely to be amplified in the short term with further market opening unless the liberalisation is carried out in a gradual manner and it is accompanied by stronger enforcement regimes at a national level.

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