Office of Rail Regulation proposes changes to simplify railway operator licences

19 August 2005
ORR/35/05

The Office of Rail Regulation (ORR) has today published a consultation document setting out proposals to amend and simplify licences granted to operators of trains, stations, networks and light maintenance depots.  These follow ORR’s review of all standard licence conditions. Other changes arise from the Railways Act 2005, in particular the transfer in July 2005 of consumer protection licence conditions formerly the responsibility of the SRA, and from the implementation later this year of the European Directive on rail licensing.

The document explains the proportionate approach ORR proposes to take to the new requirements of the Licensing Directive including a new standard of financial fitness that most freight and passenger train operators will need to meet on an ongoing basis. The new requirements do not apply to operators of stations, networks and light maintenance depots.

Chris Bolt, ORR Chairman said:

“Through conditions in licences, ORR promotes effective and efficient working relationships between industry parties and holds operators to account in the public interest. Following our review of the conditions included in standard licences, ORR has identified several that are now outdated and could be removed or simplified to increase transparency.”

This consultation document will be of interest to all existing licensed rail operators, potential licence applicants and the holders of licence exemptions with an insurance condition. 

Notes to editors:

  1. Section 6 of the Railways Act 1993 (as amended) requires the operators of passenger and non-passenger trains, stations, light maintenance depots and network to hold an appropriate licence or licence exemption. Licences can be granted either by ORR or by the Secretary of State. ORR publishes template licences on its website and these form the basis of those normally granted to new applicants.
  2. There are currently around 60 licensed operators holding about 160 different licences between them. Most operators (apart from Network Rail Infrastructure Limited) hold licences in standard form and the review focused on these.
  3. The Department for Transport has recently consulted on draft regulations to implement the First Package of European Rail Directives including one Directive focused on licensing matters (Directive 2001/13 amending Directive 1995/18 on the licensing of railway undertakings). The Regulations provide for licences to be granted by ORR, valid throughout the EU, to most passenger and freight train operators. To remain valid four criteria  - professional competence, third party liability insurance, good repute and finacial standing – must be met on an ongoing basis. Matters currently included in licence conditions under the Railways Act will be incorporated in a Statement of National Regulatory Provisions (SNRP). DfT intends that existing licences will be designated as partly new European licences and partly as a SNRP, thus avoiding the need for existing operators to apply for new licences.
  4. The imposition and enforcement of the seven standard consumer protection licence conditions are now the responsibility of ORR following commencement of the relevant provisions of the Railways Act 2005. DfT has assumed approval roles under the terms of certain of these conditions and routine maintenance of compliance. A modification scheme has made the minimum changes to licences and licence exemptions needed to effect changes arising as a result of the Railways Act 2005. Other changes to existing licences set out in the consultation document will be implemented with the consent of the licence holder.
  5. Licensing Review: Consultation is also available from the ORR Librarian, Sue MacSwan, 1 Waterhouse Square, 138–142 Holborn, London EC1N 2TQ, tel: 020 7282 2001, fax: 020 7282 2045, e-mail: rail.library@orr.gsi.gov.uk.

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