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English Welsh and Scottish Railway Limited

No. 17/11/2006

The Office of Rail Regulation (ORR) has concluded that English Welsh & Scottish Railways (EWS) has infringed the prohibition contained in Chapter II of the Competition Act 1998 (the Act) and Article 82 of the EC Treaty.

EWS has infringed the Chapter II prohibition/ Article 82 by engaging in the following conduct in the market for the haulage of coal by rail in Great Britain:

a) concluding contracts with industrial users of coal whose terms had the effect of excluding competitors from the market; 
b) pursuing discriminatory pricing practices in relation to Enron Coal Services Limited; and
c) predatory behaviour directed towards Freightliner Heavy Haul.

ORR considers conduct that amounts to an abuse of a dominant position to be a serious infringement of the Act and has therefore imposed a penalty on EWS. In calculating the level of penalty, ORR has had regard to the OFT's Guidance as to the appropriate amount of penalty and the requirement that a penalty must reflect the seriousness of the conduct involved and serve to deter future infringement of the Act.

ORR has had regard to EWS's co-operation in the investigation and has applied a 35 per cent discount to the penalty. In particular, EWS has accepted ORR's infringement findings as set out in the decision which has allowed the case to be more quickly and effectively resolved than would otherwise have been the case.

As a result, ORR has imposed a penalty of £4.1 million on EWS.

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