Investigation begins against signalling duopoly of Siemens and Alstom

London, United Kingdom (Urban Transport News): The UK's rail regulator Office of Rail & Road (ORR) has commenced an investigation and market study looking into the supply of rail signalling systems. The purpose of a signalling system is to determine the position of trains on the network, control their direction and signal to the driver when it is safe to proceed to the next section of track. Signalling systems are essential to keeping trains safe distances apart across a large and busy network. "Signalling systems are an essential part of the railway. They keep passengers safe by ensuring trains do not come into conflict with each other and play a key role in freeing up capacity on our congested network. Signalling accounted for over £4bn of Network Rail’s spend over the 5 year period between 2014 and 2019. This spend is forecast to remain significant into the future, and include costs for the planned roll-out of new digital technology on to the network", said in the statement. Signalling systems also have a role to play in freeing up capacity on the network, which is already constrained, by allowing more trains to run on the network safely. One of the key objectives of the roll-out of the digital railway is to increase the efficiency of systems so that trains can run safely, closer together. The investigation intends to focus on the level of competition for the delivery of significant signalling projects. The ORR wants to look at the strength of competition for tenders, and, whether there are any barriers to innovation or new entrants entering with new technology solutions. The regulator will examine whether there is fair and commercially reasonable access to interlocking technology, and other aspects of the installed railway infrastructure base, which are necessary to deliver complex signalling projects in Great Britain. According to the ORR, this market study initiated based its recent work in the signalling market, notably its engagement with the European Commission about the proposed merger of Siemens and Alstom, which was rejected in February 2019.  Another important reason for looking at the Railway Signalling market is because the regulator wants to ensure that any competition issues in the supply chain do not slow down or drive up the cost of the roll-out of the digital railway. In its earlier report, ORR has pointed out the duopoly of Siemens and Alstom in Network Rail’s CP5 signalling framework contracts which can be seen in the table given below:-

Framework Area	Primary Contractor	Secondary Contractor
Scottland	Siemens	SSL (Alstom)
Central (West)	Siemens	SSL (Alstom)
Central (East)	SSL (Alstom)	Siemens
Wales and West	Siemens	SSL (Alstom)
Great Western (Inner)	SSL (Alstom)	Siemens
Great Western (Outer)	SSL (Alstom)	Siemens
Angila & Kent	Atkins	SSL (Alstom)
Sussex & Wessex	Atkins	Siemens

Tom Cole, Head of Competition, Office of Rail & Road (ORR), said: “The ability for Network Rail to drive value for money when buying high-quality signalling systems is vital to its delivery of a reliable and efficient railway. We want to ensure the signalling supply chain is fair and competitive and delivering good outcomes for the ultimate benefit of passengers and other users and the taxpayer.” The Office of Rail & Road is the independent economic and safety regulator for the railways in Great Britain, and the monitor of performance and efficiency for England’s motorways and trunk roads. The ORR keep the provision of railway services under review and monitor the competitive situation in rail services markets. Last year the regulator had made several representations to the European Commission against the proposed merger of Siemens and Alstom, key players in the UK's signaling market.