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PHARE PROJECT FICHE 1. Basic Information

1.1 CRIS Nr.: HR2006/018-113/5/1 1.2 Title: Restructuring and Development of Croatian Railway

System within the framework of EU legislation 1.3 Sector: 43010 1.4 Location: Republic of Croatia 1.5 Duration: 36 months

2. Objectives

2.1 Overall Objective(s): The overall objective is to prepare Croatia to fulfil the requirements of the European Union membership in particular adherence to the acquis communitaire in the railway sector. 2.2 Project Purpose: The project purpose is to establish the legal and institutional framework for the Croatian rail sector in accordance with the EU acquis communitaire. 2.3 Accession Partnership, NPIEU priority and Croatian Transport

Development Strategy AP

Short Term Priorities:

• Adopt a programme for transposition for the transport acquis. Medium Term Priorities:

• Complete alignment on road transport legislation, railways, air transport (particularly air safety and air traffic management) and inland waterways

• Ensure effective implementation and enforcement of transport legislation

• Prepare the Croatian transport fleet for the technical norms that will allow complete integration into the internal market.

Croatia 2005 Progress Report by EUROPEAN COMMISSION 9 November 2005 Chapter 14: Transport policy "There is limited progress to report in the railway sector. The 2003 Railway Act will only become effective on 1 January 2006. A considerable amount of

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implementing legislation remains to be adopted, and the restructuring of the state railway company is only planned for the longer term. The situation concerning the administrative capacity in the Ministry of Sea, Tourism, Transport and Development remains unchanged, with 16 people working in the Railway Transport Directorate and no independent regulatory body. The administrative capacity in this sector should be reinforced." NPIEU and Croatian Transport Development Strategy

National Program for the Integration in the European Union (NPIEU 2006) IV. Development of Administrative Capacities 3.14.4 Railway Transport „The Ministry of Sea, Tourism, Transport and Development (MSTTD) asked the European Commission for technical assistance in form CARDS project which shall define guidelines for pre-accession railway transport strategy, improvement of safety issues in railway transport, administrative capacity building and preparation of possible projects for PHARE program...“ Croatian Transport Development Strategy Rail Transport is included in Section 7 of the Croatian Transport Development Strategy (1999). The following actions are foreseen:

• synchronization with European network and meeting European norms, technical standards and transport parameters of the infrastructure on major European trunk routes (corridors);

• increase in quality of services (regularity, comfort, organization, application

of information technology in business), productiveness and efficiency, as well as reaching European standards in this respect;

• developing a network in accordance with needs and available funds (using

market criteria in development of services, infrastructure and means of transport), underlining the orientation toward Adriatic (strategic construction of new low-altitude lines from hinterland to the Adriatic);

• Adapting to legislation of the EC concerning railway transport (application of

Directives 91/440/EEC, 95/18/EC and 2004/49/EC as in force and 2001/14/EC).

• Application of Directives 2001/16/EC and 96/48/EC and amendment

2004/50/EC and their belonging harmonised standards and Technical specifications of Interoperability (TSI).

3. Description

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3.1 Background and justification:

Inside the Ministry of Sea, Tourism, Transport and Development (MSTTD) there are two units responsible for the railway sector. The Railway Directorate is the administrative unit that is responsible for the implementation of the acts and regulations related to the railway transport sector. The Directorate employs thirteen persons who are experts in economics, law, traffic, and civil, electrical and mechanical engineering. The Railway Directorate is divided into three departments: 1. Department for railway and combined transport, 2. Department for railway infrastructure and rail facilities, 3. Department for development of safety in railway transport, The departments are responsible for the preparation of legal instruments, development strategies, reports, analysis and draft measures concerning railway transport, including safety and infrastructure issues in line with the determined sector policy. Under the Directorate for Transport Inspection the Department for Inspection of Safety in Railway Transport is responsible for supervising the applications and all other legal issues related to rail transport. The Croatian Railways (HŽ – Hrvatske željeznice) are a state owned company (100%) that operates the entire railway system. Its railway network has a length of 2974 km. HŽ employs 14250 people (November 2005). Until the adoption of the LAW ON DIVISION OF THE COMPANY HŽ – HRVATSKE ŽELJEZNICE D.O.O. (CROATIAN RAILWAYS LTD.) (OJ 153/05), December 2005, HŽ was organised on a functional basis with a highly vertical integration. Four main business areas: operation, rolling stock, infrastructure and coordination with other companies. HŽ was responsible for both infrastructure construction and maintenance as well as train operations. There was no accountancy separation of infrastructure and operations or of services provided under public sector obligations. HŽ also owns and operates 16 affiliated companies with limited liability including companies operating in the fields of combined transport, printing, catering, manufacture of railway vehicles, repairs and spare parts, cleaning, security services, maintenance of wagons and locomotives, planning and construction of electronic devices, rail building construction and maintenance, engineering and development plans, production and re-finalisation. Furthermore, a railway project management company is owned by 51% by HŽ. Given HŽ’s current organisation structure it is difficult to assess the financial performance and profitability of its constituent parts. In particular it is difficult to assess the financial performance of the passenger and freight sectors as a basis for determining subsidy requirements.

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A new Railway Act was passed in 2003 which came into force on of the 1st of January 2006. According to the Law on Division of the Company HŽ which came into force in December 2005 the new structure of the state railway company will be a holding company with four subsidiaries: management, maintenance and construction of infrastructure, passenger transport, freight transport and traction. After the ongoing discussions with staff and union representatives, the separation is envisaged in mid 2006. The Croatian rail sector in 2003 transported 36 million passengers, which is close to the volume of 1990 (however, the financial effect is lower due to the larger share of suburban transport in cooperation with ZET- Zagreb Municipal Transit System); 11.7 millions tons were transported by rail, only 1/3 of the volume in 1990. This is mainly due to the transformation of the Croatian economy from industrial production to services. Moreover the Croatian regions are not appropriately connected by rail, particularly the connection of Dalmatia to other parts of Croatia (Ploče is not directly connected to the Croatian railway network) while the railway network of Istria is connected with the Slovenian Railways. In 2004 railway passenger transport had a total market share of 32,5% and 11,2% in freight transport. However, in the first half year of 2005 there was steady increase in railway transport. HŽ is unable to meet the operating costs and debt obligations out of the revenues and to fund its investments. As a State Economic Enterprise, HŽ is subject to Government influence and intervention, including the appointment of senior staff and the setting of tariffs. Intervention has its legal basis. HŽ has made efforts to restructure itself in accordance with the Project of Modernization and Restructuring of Railways, adopted by the Government of the Republic of Croatia supported and financed by the World Bank (WB) and European Bank for Reconstruction and Development (EBRD). The project was carried out between 1999 and 2003) with the following objectives: • average annual increase in production of around 8%, which should be

achieved by increasing the transport revenues and reducing of the number of employees to 16,000 by the end of the five-year period; it would also require implementation of a social program, with funds of € 65,87m (of which € 40,8m are from the state budget).

• reduction of operating costs by closing unprofitable lines and decreasing

the number of unprofitable passenger trains, reorganisation of the organisation structure etc..

• reduction of funds allocated from the state budget for business operation

of HŽ down to 0.9% of GDP,

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• investment in the rail sector of € 22,5b. The existing railway laws do not fully comply with EU legislation. Modifications should be made to the following Croatian legal issues in the rail sector:

• Management independence of incumbent railway undertakings (91/440, Section II)

• Principles for separation of infrastructure from transport operations (91/440, Section III and 2001/14, Chapter II - Infrastructure charges and accounts)

• Improvement of financial situation of incumbent railways (91/440, Section IV- burden of debt)

• Equitable access to railway infrastructure (91/440, Section V; 2001/14, Chapter I and II - infrastructure charges plus services and network statement, Art. 3 and 5 plus annexes

• Capacity allocation (2001/14, Art. 22-28) • Regulatory body (2001/14, Art. 30) • Railway safety (2004/49 – procedures for safety certificate and safety

authorities, accidents and investigations) • Licensing guidelines (95/18 amended by 2001/13 and 2004/49) • Further liberalisation of the railway market Principles for the

establishment of necessary bodies and institutions (i.e. safety authority, 2001/41, Art. 32)

Action is therefore required to (i) ensure compliance with the legal requirements of accession, and (ii) to ensure that the successor of HŽ is able to meet the market and commercial pressures that accession and subsequent market liberalisation will bring. 3.2 Sectoral rationale

Not applicable

3.3 Results

The following results are expected from the project: Result No. 1: Existence of the following necessary bodies by the end of 2009:

• a licensing authority

• a regulatory body

• a safety authority

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• an infrastructure manager

• a capacity allocation body

• a charging body

• a notified body Result No. 2: The staff of the licensing authority, safety authority and notified body is trained in order to fulfil the functions attributed to the necessary bodies and institutions. Result No. 3: The staff of the infrastructure manager is trained in order to fulfil the functions attributed to it. Result No. 4: Procedures concerning non-discriminatory rail market access, infrastructure charging and safety authorisation are drafted for adoption and implementation. The staff of the regulatory body is trained in order to fulfil the functions attributed to it. Result No. 5: IT-support is implemented. Result No. 6 Directives 2001/16/EC and 96/48/EC and amendment 2004/50/EC concerning safety matters and harmonised standards are applied. Result No. 7 Technical specifications for Interoperability (TSI) are applied. 3.4 Activities: The proposed project will provide technical assistance, support and training to the Ministry of Transport and stipulated bodies and institutions in the area of rail restructuring and regulation. In order to facilitate the project implementation and to ensure its successful and sustainable application, the results and their associated activities will be divided and grouped into four lots. The four lots will be tendered independently.

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Lot I:

- Establishment of necessary bodies by the end of 2008

- Staff training for licensing authority, safety authority and notified body

- Implementation of IT-support

- Harmonisation of standards (interoperability)

Activities associated with Result No. 1: • Drafting of new laws and regulations necessary to comply with EU

regulations.

• Preparation of the establishment of the necessary bodies and institutions.

Activities associated with the result No. 2: • Establishment of training programs.

• Training of staff to enable bodies to function, including (a) Workshops on: o EU directives o best practice implementation procedures in the following fields:

- licensing - safety certification - safety authorisation for rolling stock / traction and infrastructure

installations with particular emphasis on interoperability - best practices concerning the functions of notified bodies - international cooperation (one-stop-shops, border crossing,

operational interoperability, acceptance of foreign train drivers and best practice cooperation models)

(b) Study tours o one study tour visiting best practice of the above bodies, including the

European Rail Agency (c) Training on-the-job: o The experts shall cooperate with the staff on a day-to-day basis in order

to strengthen the staff’s skills (training on-the-job) (d) Working groups

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o drafts, directives and decisions prepared by the staff and the technical

assistance shall be discussed in inter-department working groups in order to ensure cohesive procedures

o ½-day and 1-day workshops and conferences shall be organised in

order to deal with specific questions resulting from the day-to-day work

Activities associated with the Result No. 5:

• A specific working group shall be established to make an inventory of existing IT-technology and define the future IT-technology demands.

• IT-technology shall be tendered and purchased.

• Staff members shall be trained in the use of the IT-technology.

Activities associated with the Result No. 6: • Procedures shall be prepared for implementation.

• Initially the implementation shall be monitored on a regular basis and adjustments applied if necessary.

Lot II: Staff Training Infrastructure Manager Activities associated with the result No. 3: • Establishment of training programs.

• Training of staff to enable the Infrastructure Manager (IM) to function, including (a) Workshops on: o EU directives o best practice implementation procedures in the following fields:

- infrastructure management with particular emphasis on interoperability, energy supply and financing, private finance and Public Private Partnership (PPP)

- capacity allocation with particular emphasis on non-discriminatory access and path allocation conflicts

- infrastructure charging methods with particular emphasis on market oriented risk sharing

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- international cooperation (one-stop-shops, border crossing, operational interoperability, acceptance of foreign train drivers and best practice cooperation models)

(b) Study tours o one study tour visiting best practice of IMs, capacity allocation bodies

and charging bodies which are separated from the IM (c) Training on-the-job: o The experts shall cooperate with the staff on a day-to-day basis in order

to strengthen the staff’s skills (training on-the-job) (d) Working groups o drafts, directives and decisions prepared by the staff and the technical

assistance shall be discussed in inter-department working groups in order to ensure cohesive procedures

o ½-day and 1-day workshops and conferences shall be organised in

order to deal with specific questions resulting from the day-to-day work Remark: It is inevitable to get in touch with national experts to harmonise the EU’s Member States’ network statements and rules of traffic allocation processes, their approval policies and infrastructure access regulation processes to make international railway transportation easier and guarantee a safe and liable transportation system. The study visits shall also show the Croatian experts the relationship among state, infrastructure administrators and railway undertakings in the process of network statement adoption.

Lot III: Staff Training Regulatory Body

Activities associated with the result No. 4: • Establishment of training programs.

• Training of staff to enable bodies to function, including (a) Workshops on: o EU directives o best practice implementation procedures in the following fields:

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- non-discriminatory regulation between IM and Rus - non-discriminatory regulation among RUs - fair competition

(b) Study tours o one study tour visiting best practice in not more than three member

states concerning the role of the regulatory body in an open access rail market

o one study tour visiting best practice of regulatory bodies, including the Directorate General “Competition” of the EU

(c) Training on-the-job: o The experts shall cooperate with the staff on a day-to-day basis in order

to strengthen the staff’s skills (training on-the-job) (d) Working groups o drafts, directives and decisions prepared by the staff and the technical

assistance shall be discussed in inter-department working groups in order to ensure cohesive procedures

o ½-day and 1-day workshops and conferences shall be organised in

order to deal with specific questions resulting from the day-to-day work

Lot IV: Technical Specification for Interoperability Activities associated with the Result No. 7: • Detailed tasks and responsibilities for the adaptation and implementation

shall be prepared.

• Procedures shall be prepared for implementation.

• Permanent monitoring of the implementation has to be ensured.

Remark:

It has to be ensured that the structure of technical standards according to EU Directives is reflected in results No. 1 through to 6.

Inputs

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Technical Assistance National Project Director The Ministry of Sea, Tourism, Transport and Development shall appoint a NPD. The NPD together with the PAA shall co-ordinate the activities of the project. Furthermore, the NPD shall be the team leader of national project team. He shall appoint and deploy the team members. Technical Adviser (TA): Total of 18 m/m

A TA on rail sector legislation and rail way restructuring shall give advice and technical assistance to the MSTTD on clarifying, defining and helping implement the regulatory requirements of the EU Acquis in the rail sector. The TA will assist in the drafting, review or modification of new rail sector legislation. The TA will ensure that best practice in rail regulation is included in new legislation for MSTTD and the Croatian rail sector. The TA will act as team leader and will be assisted by a pool of STEs and MTEs called upon on an ad-hoc basis when the need arises to provide more focussed advice. The TA will co-ordinate the deployment of the experts. The long-term expert: senior adviser to the MSTTD

• Minimum of five years experience working in the field of rail restructuring and regulation within the EU.

• Substantial knowledge of regulatory issues involved in a competitive rail market, including licensing, access to railway infrastructure, capacity allocation and infrastructure charging.

• Substantial knowledge and experience in railway sector reform and liberalization of rail market as well as the corresponding EU acquis.

• Strong personality with excellent interpersonal and communication skills.

• Experience in project management.

• Advanced university degree in law, economics, business administration or related discipline.

• International advisory or consulting experience.

• Experience in project management and procurement rules.

• Good written and oral command of English.

• Experience in developing, co-ordinating and conducting training programmes.

Tasks of the TA

• to coordinate the entire programme and to design a work plan for the implementation of the programme;

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• to plan and coordinate outputs;

• to nominate and mobilize experts;

• to coordinate study visits, training activities, workshops and other public awareness activities;

• to ensure proper quality of outputs;

• to provide to the beneficiary and the European Commission a detailed report on the results of the programme.

Short Term to Medium Term Expert Facility: International experts with a total of up to 96 m/m covering the following areas:

• Rail legislation

• Rail regulation and competition

• Infrastructure charging

• Capacity allocation

• Licensing requirements and procedures

• Safety regulation and certification

• Public sector obligations and contracts

• Rail accountancy

• Technical knowledge of rolling stock, infrastructure and operations The required profile of the experts is as follows: • A minimum of 3 years professional experience in their respective fields

working on rail legislation and regulation, restructuring of state railways, competition and market oriented operation and infrastructure management.

• Advanced university degree in a relevant subject: law, economics, business administration or related discipline.

• Good written and oral command of English.

Study Tours Five study tours by rail sector administration and rail management officers of the MSTTD and its RD and other relevant rail transport institutions to respective institutions of chosen Member States will be organised, each for 5-10 persons for 10 days. Internship

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Within an overall limit of 10, a selected number of MSTTD and successor of HŽ staff will work for a month in a relevant organisation. The staff will be selected by MSTTD and successor of HŽ in consultation with the international expert. . Workshops/Information Events A minimum of eight seminars, workshop or other information events will be held in Croatia, each two days. Participation in Rail Transport Conferences Participation of MSTTD and successor of HŽ staff in 10 conferences/exhibitions, meetings organized in the EU Member or Candidate States concerning the rail transport matters. Up to 4 MSTTD and HŽ staff shall participate in each conference. Supply The necessary hardware and software shall be procured for the establishment of the MIS at MSTTD and successor of HŽ (including system installation, software customisation and training). Technical Assistance A Technical Assistance Team shall support MSTTD and successor of HŽ in conduct of the tasks of each activity. The Technical Assistance will be carried out in close co-operation with staff from MSTTD and successor of HŽ.

3.5 Linked Activities

In order to improve the financial performance of HŽ the above mentioned World Bank project only the restructuring process of the state railway company and does not cover other activities which are necessary for the alignment of the railway sector to EU railway policy. Further restructuring activities will continue under World Bank PAL loan condition.

Technical assistance through Administrative Capacity Building/Project Preparation Facility - CARDS 2004 has been engaged in order to:

- Assist Railway directorate of MSTTD with drafting the Pre-accession Railway Transport Strategy for Croatia, containing recommendations for improving the existing railway transport sector as well as 'project pipeline' to meet national railway transport needs. The strategy is based on legislative gap analysis, comparing Croatia’s railway transport legislation with EU railway legislation, gap analyses related to administrative and organizational capacities in order to ensure alignment with EU requirements by identification of priorities and appropriate measures in the field of legislative approximation, institution building and associated investments including an indication of a clear timetable for their implementation as a part of the EU accession process;

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- Assist the Project Implementation Unit within the MSTTD in preparing this PHARE Project Fiche. - Provision of guidelines for improvement of multi - modal transport through identification of main obstacles and definition of guidelines for improvement of multi modal transport, including links/flows with other countries / TEN corridors and Motorways of the Sea concept;

3.6 Lesson learned

Within the scope of the pre-accession strategy a needs and gaps analysis of the institutional and legal situation has shown clear gaps in all relevant fields to meet EU legislation and regulation criteria. The final results were presented on March 7th, 2006. Attempts to restructure the railway sector administration and successor of HŽ have been proved to be inefficient. Therefore a PHARE project with an overall approach to this issue is necessary.

4. Institutional Framework

The direct and indirect beneficiaries of this project are: For all results

• the Ministry of Sea, Tourism, Transport and Development (MSTTD); and

• the successor of Hrvatske željeznice – Croatian Railways (HŽ);

• the stipulated bodies and institutions. All of the results are inter-linked and dependent upon the successful completion of preceding components. The successful implementation of the project will require the close co-operation of MSTTD, the successor of HŽ and other Government departments such as the Ministry of Finance as well as others.

MSTTD predicted employment of new staff in Railway directorate. It is envisaged that till 2007 new 3 persons will be employed, as well as in next periods till 2009. 5. Detailed Budget (in €)

Phare support Co-financing Total Cost Year 2006 - Investment support jointly co funded

National Public Funds

(*)

Other Sources

(**)

Total Co-financing

of Project

Equipment Supplies Contract 600.000 200.000 0 200.000 800.000

Investment support – sub-total 600.000 200.000 0 200.000 800.000

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% of total public funds max 75 % min 25 %

Year 2006 Institution Building support

Technical Assistance Contract 2.200.000 0 0 0 2.200.000

IB support – sub total 2.200.000 0 0 0 2.200.000

Total project 2006

2.800.000 200.000 0 200.000 3.000.000

(*) contributions form National, Regional, Local, Municipal authorities, FIs loans to public entities, funds from public enterprises (**) private funds, FIs loans to private entities

6. Implementation Arrangements

6.1 Implementing Agencies The Central Financing and Contracting Unit (CFCU) at the Ministry of Finance is responsible for the tendering, contracting and disbursement of all the project’s components in line with DIS principles and the PRAG

Programme Authorising Officer

Mrs Vladimira Ivandić Assistant Minister Ministry of Finance Katančićeva 5 10000 Croatia

Senior Programme Officer

Mr Željko Tufekčić Assistant Minister Ministry of the Sea, Tourism, Transport and Development Krležin Gvozd 1a 10000 Zagreb Croatia Tel.: +385 1 3783 986 Fax.: +385 1 3783 989 E-mail: financije@ws.mmtpr.hr

6.2 Twinning Not applicable.

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6.3 Contracts For technical assistance: € 2,2m. For equipment supply: € 0,8m.

7. Implementation Schedule

Start of Tendering

Start of project activities

Project completion

Technical Assistance

June 2006 January 2007 November 2009

Equipment supply

December 2006 May 2007 February 2009

8. Equal Opportunity

Equal opportunity principles and practices in ensuring equitable gender participation in the project will be guaranteed. Male and female participation in the project will be based on the relevant standards of the EU and will be assured by official announcements published to recruit staff needed for the project. The main criteria for staff recruitment will be appropriate qualifications and experience in similar projects, not sex or age. Both men and women will have equal opportunities and salaries.

9. Environment The project has no negative effect on the environment. Improving the competitiveness of railway sector will help to constrain levels of road traffic, reducing levels of congestion, atmospheric pollution and road accidents.

10. Rate of return Not applicable. 11. Investment criteria Not applicable. 12. Conditionality and sequencing The EU financing for this project is conditional upon:

• The adoption of the pre-accession railway transport strategy by the Ministry of Sea, Tourism, Transport and Development of the Republic of Croatia.

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• National co-financing for the equipment part to be confirmed prior to signing of Supply contract.

• Strengthen the rail sector administration inside the MSTTD

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ANNEX TO PROJECT FICHE 1. Logical framework planning matrix 2. Time implementation chart for the project 3. Contracting and disbursement schedule 4. Technical Specifications for IT equipment 5. List of references

Annex 1 to Project Fiche

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Logframe for Phare project

LOGFRAME PLANNING MATRIX FOR Restructuring and Development of Croatian Railway system within the framework of EU legislation

Programme name and number: PHARE 2006

HR2006/018-113/5/1

Contracting period expires: 30.11.2008.

Disbursement period expires: 30.11.2009.

Ministry of the Sea, Tourism, Transport and Development, Zagreb, Croatia

Total budget : 3 million EUR

PHARE budget: 2.8 million EUR

Overall objectives Objectively verifiable indicators Sources of Verification

The overall objective is to prepare Croatia to fulfil the requirements of European Union membership in particular adherence to the acquis communautaire in railway sector.

• Acknowledgement by the EU-Commission • Transfer of EU-Railway-Directives into national

law

• Documentation of the EU acknowledgement

• Official gazette • Report of the MSTTD

Project purpose Objectively verifiable indicators Sources of Verification Assumptions

The project purpose is to establish the legal and institutional framework for the Croatian rail sector in accordance with the EU acquis communautaire.

Existence of:

• a licensing authority

• a regulatory body

• a safety authority

• an infrastructure manager

• a capacity allocation body

• a charging body

• a notified body

• Official Gazette and corresponding directives by the MSTTD

• The political environment accepts the adherence to the acquis communautaire

Results Objectively verifiable indicators Sources of Verification Assumptions

Result No. 1: • According to results:

Result 1: Official Gazette and

• Continuing training of staff ensured

Annex 1 to Project Fiche

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Existence of the following necessary bodies by the end of 2009:

• a licensing authority

• a regulatory body

• a safety authority

• an infrastructure manager

• a capacity allocation body

• a charging body

• a notified body

Result No. 2:

The staff of the licensing authority, safety authority and notified body is trained in order to fulfil the functions attributed to the necessary bodies and institutions.

Result No. 3

The staff of the infrastructure manager is trained in order to fulfil the functions attributed it.

Result No. 4:

Procedures concerning non-discriminatory rail market access, infrastructure charging and safety authorisation are drafted for adoption and implementation. The staff of the regulatory body is trained in order to fulfil the functions attributed to it.

Result No. 5:

IT-support is implemented.

Result No. 6

Directives 2001/16/EC and 96/48/EC and amendment 2004/50/EC concerning safety matters and harmonised standards are applied.

Result No. 7

Technical specifications for Interoperability (TSI) are applied.

- Result 1: The necessary bodies and institutions are established Result 2: Approximately 50 staff trained Result 3: Procedures published respectively available to the interested parties Result 4: Successful implementation of IT-system

• Others: At least one formal application for the establishment of a railway undertaking in freight and passenger transport and one for infrastructure management outside the former HŽ state enterprise

corresponding directives by the MSTTD

Result 2: Training courses and study tours

carried out Result 3: Directives on infrastructure

charging, safety certification and authorisation for rolling stock.

Network statement published Result 4. Documentation

• Staff available • Proposed equipment and

information technology systems are maintained and continuously upgraded

Activities Means Total cost (in Mio €) Assumptions

Annex 1 to Project Fiche

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• Drafting of new laws and regulations necessary to comply with EU regulations.

• Preparation of the establishment of the necessary bodies and institutions.

• Establishment of training programs.

• Training of staff to enable bodies to function, including

(a) workshops on:

o EU directives

o best practice implementation procedures in the following fields:

- licensing

- non-discriminatory regulation

- fair competition

- safety certification

- safety authorisation

- infrastructure management

- capacity allocation

- infrastructure charging methods

- best practices concerning the functions of notified bodies

- international cooperation

(b) study tours

o one study tour visiting best practice in not more than three member states concerning the role of government in an open access rail market

o one study tour visiting best practice of regulatory bodies o one study tour visiting best practice of capacity allocation

bodies o one study tour visiting best practice of safety authorities,

including the European Rail Agency o one study tour visiting private rail undertakings in freight

and passenger transport

(c) training on-the-job:

- technical assistance - equipment - conferences - workshops - study tours

Equipment Supplies Contract: 0,6 M€ Institution Building: TA Contract: 2,2 M€

Annex 1 to Project Fiche

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o The staff shall cooperate with the experts on a day-to-

day basis in order to strengthen their skills (training on-the-job)

(d) working groups

o drafts, directives and decisions prepared by the staff and

the technical assistance shall be discussed in inter-department working groups in order to ensure cohesive procedures

o ½-day and 1-day workshops and conferences shall be

organised in order to deal with specific questions resulting from the day-to-day work

• Procedures shall be prepared for implementation.

• Initially the implementation shall be monitored on a regular basis and adjustments applied if necessary.

• A specific working group shall be established to make an inventory of existing IT-technology and define the future IT-technology demands.

• IT-technology shall be tendered and purchased.

• Staff members shall be trained in the use of the IT-technology.

• Technical standards: Detailed tasks and responsibilities for the adaptation and implementation shall be prepared.

• Technical standards: Procedures shall be prepared for implementation.

• Technical standards: Permanent monitoring of the implementation has to be ensured.

Annex 2 to Project Fiche

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ANNEX 2 TIME IMPLEMENTATION CHART

Restructuring and Development of Croatian Railway system in a frame of EU legislation

2006 2007 2008 2009 Description

J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N

Contract TA T T T T T C

Result No. 1

Drafting of new laws and regulations

I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I

Preparation of the establishment of the necessary bodies and institutions

I I I I I I I I I I I I I I I I I I I I I I I R R

Result No. 2

Establishment of training programs

I I I

Training of staff / workshops / working groups

I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I R

Study tours I I I I I R

Result No. 3

Establishment of training programs

I I I

Training of staff / workshops / working groups

I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I R

Study tours I I I I I R

Annex 2 to Project Fiche

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Result No. 4

Establishment of training programs

I I I

Training of staff / workshops / working groups

I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I R

Study tours I I I I I R

Result No. 5

Contract Equipment supply

T T T T T C

Tendering and purchasing

I I R

Training of staff members

I I I I R

Result No. 6

Tasks and responsibilities prepared.

I I I I I R

Procedures for implementation.

I I I I I I

Permanent monitoring of the implementation

I I I I I I I I I I I I I I I I I I I I I I I I I I I I I

Result No. 7

Tasks and responsibilities prepared.

I I I I I R

Procedures for implementation.

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Permanent monitoring of the implementation

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Annex 2 to Project Fiche

Version III,5, 2006-1-23 25

Annex 3 to Project Fiche

Version III,5, 2006-1-23 26

ANNEX 3

CUMULATIVE CONTRACTING AND DISBURSEMENT SCHEDULE

Restructuring and Development of Croatian Railway system within the framework of EU legislation In m €

2007 2008 2009 1.Q 2.Q 3.Q 4.Q 1.Q 2.Q 3.Q 4.Q 1.Q 2.Q 3.Q 4.Q

Contracted TA assistance 2,2 Contracted Equipment supply 0,6

Total contracted 2,2 2,8 2,8 2,8 2,8 2,8 2,8 2,8 2,8 2,8 2,8 2,8 Disbursed TA assistance 0,241 0,482 0,722 0,963 1,113 1,300 1,450 1,600 1,750 1,900 2,050 2,200 Disbursed Equipment supply 0,6 Total Disbursement 0,241 0,482 1,322 1,563 1,713 1,900 2,050 2,200 2,350 2,500 2,650 2,800

Annex 4 to Project Fiche

Version III,5, 2006-1-23 27

Technical Specifications for IT equipment

1. Background information about the project An EC funded technical assistance contract will being executed by International Consultants and serves the main objective of providing assistance for the establishment of institutional bodies related to the railway sector regarding the aqcuis communautaire. This tender serves the purpose of procuring IT hardware equipment and software, which is required for the operation the bodies. 2. Role of equipment in the project All IT equipment will be used to fulfil the requirements of the new established bodies in Croatia. Because of the non-existence of these bodies a new data base has to be created in order to guarantee function and efficiency of the bodies. Besides the IT supply of hardware for the expected employees within the bodies, a software development project will be included. The beneficiary of the software and database will be the licensing authority, the safety authority and the notified body. They will be connected and equipped with a common data base for rolling stock and infrastructure information. This information needs to be provided in a common database to ensure the safety and interoperability of rolling stock on the Croatian railway infrastructure.

ITEM DESCRIPTION QTY REMARKS AND DISTRIBUTION SCHEDULE

kind of equipment IT-Workplace

Desktop or Laptop, network connection, network database, software, security items

70 Distributed from mid 2007 to mid 2009, depending on the establishment of the bodies. (expected costs per workplace EUR 4.200, total 300.000)

Software common database for rolling stock and railway infrastructure

Creation of a common database of interoperability and technical description of rolling stock. Beneficiaries are the safety authority, the licensing authority and the notified body

1 To be created and distributed in 2007, (expected costs: 500.000 EUR)

LIST OF REFERENCES 1. RAILWAY ACT, Zagreb, July 2003. (OJ 123/03, 30/04)

2. DECISION PROMULGATING THE ACT ON AMENDMENTS TO THE RAILWAY ACT, Zagreb, 8 March 2004. (OJ 194/03)

3. RULE BOOK ON THE CONDITIONS AND METHOD OF ISSUING A SAFETY DECISION FOR PERFORMING RAILWAY TRANSPORT SERVICES, Zagreb, 13 October 2005. (OJ 127/05)

4. RULE BOOK ON THE CONDITIONS AND METHOD OF ISSUING A SAFETY ORDER FOR THE MANAGEMENT OF THE RAILWAY INFRASTRUCTURE, Zagreb, 13 October 2005. (OJ 127/05)

5. RULE BOOK ON CONDITIONS AND THE WAY OF ISSUING A LICENCE FOR PERFORMING THE SERVICES OF THE RAILWAY TRANSPORT AND A LICENCE FOR THE MANAGEMENT OF THE RAILWAY INFRASTRUCTURE, Zagreb, 13 October 2005. (OJ 127/05)

6. RULE BOOK OF RAILWAY INFRASTRUCTURE, Zagreb, 13 October 2005 (OJ 127/05).

7. NATIONAL PROGRAM FOR THE INTEGRATION IN THE EUROPEAN UNION (NPIEU), Zagreb 2006.

8. LAW ON DIVISION OF THE COMPANY HŽ – HRVATSKE ŽELJEZNICE D.O.O. (CROATIAN RAILWAYS LTD.), Zagreb, December 2005 (OJ 153/05).

9. TRANSPORT DEVELOPMENT STRATEGY OF THE REPUBLIC OF CROATIA, Zagreb, November 1999 (OJ 139/99).

10. Croatia 2005 Progress Report by EUROPEAN COMMISSION 9 November 2005.

11. Council Directive 91/440/EEC of 29 July 1991 on the development of the Communities Railways. (OJ L 237, 24.8.1991)

12. Council Directive 95/18 EEC of 19 June 1995 on the licensing of railway undertakings. (OJ L143, 27.6.1995)

13. Directive 2001/12/EC of the European Parliament and of the Council of 26 February 2001 amending Council Directive 91/440/EEC on the development of the Community's railways. (OJ L075, 15.3.2001)

14. Directive 2001/13/EC of the European Parliament and of the Council of 26 February 2001 amending Council Directive 95/18/EC on the licensing of railway undertakings. (OJ L075, 15.3.2001)

15. Directive 2001/14/EC of the European Parliament and of the Council of 26 February 2001 on the allocation of railway infrastructure capacity and the levying of charges for the use of railway infrastructure and safety certification. (OJ L075, 15.3.2001)

Annex 5 to Project Fiche

16. Corrigendum to Directive 2004/49/EC of the European Parliament and of the Council of 29 April 2004 on safety on the Community’s railways and amending Council Directive 95/18/EC on the licensing of railway undertakings and Directive 2001/14/EC on the allocation of railway infrastructure capacity and the levying of charges for the use of railway infrastructure and safety certification (Railway Safety Directive) (OJ L 164, 30.4.2004).

17. Directive 2001/16/EC of the European Parliament and of the Council of 19 March 2001 on the interoperability of the trans-European conventional rail system. (OJ L110 20.4.2001)

18. Corrigendum to Directive 2004/50/EC of the European Parliament and of the Council of 29 April 2004 amending Council Directive 96/48/EC on the interoperability of the trans-European high-speed rail system (OJ L 220 21.6.2004), and Directive 2001/16/EC of the European Parliament and of the Council on the interoperability of the trans-European conventional rail system (OJ L 164, 30.4.2004).