PRICE LIST 10-01: MECHANISMS FOR TARIFF REGULATION

Abstract

[For the English abstract and full text of the article please see the attached PDF-File (English version follows Russian version)].ABSTRACT In the countries of the European Union and Russia, the owner of the railway infrastructure is the state, and the rolling stock is owned by private companies. With this model of organizing the railway industry, the main source of income for the owner of the public infrastructure is freight transportation. The main advantages of this model are the low level of monopoly power of the rolling stock owners and low probability of discrimination in access to infrastructure, and the disadvantages are low incentives for investing in infrastructure development. Consequently, the main problem for a monopolist is to attract cargo owners to transportation by rail. As it is known, the criterion of attractiveness of a particular mode of transport for a cargo owner is the cost of transportation (low tariff load), which is regulated on the Russian Railways by Price list 10-01 «Tariffs for transportation of goods and infrastructure services performed by Russian railways». Since reorganization of the tariff system in 2003, the car component of the railway freight tariff varies depending on the market conditions of the fleet of freight cars owned by the operator companies, and the infrastructure component is regulated by the infrastructure owner which is the the state. At the same time, the role of state antimonopoly regulation is of great importance, which directly affects the rail freight transportation market, and, as a consequence, the tariff. An alternative is the American model of railway organization (used in the US, Canada, some countries of South America), which has a high level of monopoly power of carriers, rolling stock operators and infrastructure owners, high probability of discrimination in access to infrastructure, high incentives to invest in infrastructure modernization. At the same time, several vertically integrated companies operate on the rail freight transportation market, and competition occurs both between private railway infrastructures and between carriers and rolling stock owners who can compete on each other’s infrastructure. State antimonopoly regulation is absent, which increases the importance of bilateral contracts between market participants. A consequence of this is the dependence of the tariff on rail freight transport exclusively on the market conjuncture. The article shows the sequence of evolution of the current Price list 10-01 «Tariffs for transportation of goods and infrastructure services performed by Russian railways» in market conditions. The foreign experience of state regulation of freight tariffs is considered at the example of two alternative models - American and European. The analysis of influence of demand and supply, formed on the domestic market by owners of cars, has been made. The structure of tariff classes and the principles of their formation are shown. One of the key features of the current system is the so-called «tariff corridor». The most significant problems are identified - cross-subsidization of lowyield cargo traffic and tariff construction by a cost principle in a state-regulated segment. Keywords: railway transport, Price list 10-01, freight transportation, tariffs, system principles.