transport sector is characterized by easy entry and poor economies of
scale. Combined with the development of
motorway networks starting in the '30s and '50s and the increases in commercial
speeds and net loads, this explains why the sector has developed so quickly and
so competitively. It also explains the
low concentration: for example, in 1985
in Sweden, 60 per cent of operators were owners driving their own vehicle. In France, 76 per cent of enterprises had
less than five employees but accounted for only 18 per cent of the market,
whereas companies with less than 50 employees held two thirds of the
market and, at the other extreme, the 20 largest enterprises held 19 per
cent of the market. In some countries,
such as the Netherlands and the United States, the concentration is higher,
especially since these countries were quicker than others to switch to
integrated logistics. At the same time,
it is possible to observe an apparent movement of de-concentration with the
large enterprises converting their employees into independent
pseudo-entrepreneurs ("owner-operators"), advancing them some of the
money they need to purchase a vehicle and benefiting, in return, from reduced
social security contributions and other social charges.
'30s, road transport has been subjected to tight quantitative regulation, at
least in North America and in Europe.
The aim was to prevent the erosion of the modal split share of the
railways by introducing a system of licences, quotas and tariffs. For its part, the road transport profession
had the benefit of a market closed to new entrants and tariffs fixed at a level
that enabled the least competitive to survive.
Thus, until the two waves of deregulation in the '60s and '80s the
profession had to operate within the context of various forms of mandatory road
transport pricing and freight bureaux benefiting from anti-trust
exemptions. These domestic regulations
were supplemented by international regulations based on bilateral agreements
incorporating the same principles:
quantitative restrictions and fixed tariffs. This economic regulation of the sector was
accompanied by social regulations (driving hours, no driving on Sundays and
public holidays) and a body of technical and safety legislation (axle loads,
system did not achieve all the objectives set for it by its promoters: it did not succeed in regulating capacity or
in preventing the erosion of rail transport, and it encouraged fraud and the
development of transport on own account.
These systems of quantitative regulation have gradually disappeared
domestically. In the United States this
has taken place within the framework of the deregulation movement (in
particular, the Motor Carriers Act of 1980 reducing the rate-setting powers of
the Inter-State Commerce Commission and the anti-trust immunity of the tariff
bureaux and making licences more flexible) and in the European Community in the
process of establishing a single road transport market (price deregulation in
1990, abolition of intra-EEC quotas, progressive liberalization of cabotage
completed on 1 January 1998, definition of qualitative criteria for access to
the profession, harmonization of driving hours and weights and dimensions, and
a start on the harmonization of the taxation of vehicles, use of infrastructure
and fuel). In the countries of Central
and Eastern Europe, liberalization was sudden and abrupt and has been succeeded
by a period of re-regulation or rather regulation, since the previous
State-owned fleets did not need to be regulated, all this accompanied by a
collapse in the market share of rail transport and a considerable increase in
that of road transport.
years, wherever there were domestic quantitative regulatory and mandatory
pricing systems or indeed State haulage enterprises, there has been a trend
towards liberalization and, where necessary, denationalization, especially at
the instigation of the World Bank. This has affected countries as different as
Papua New Guinea
and the sub-Saharan African States.
of this domestic liberalization has been a fall in prices, the creation of new
enterprises but also bankruptcies, an acceleration of concentration and
specialization, the establishment of networks, a decline in the profitability
of the sector, an adaptation of services to market demand, job creation and a relative
decline in wages. The impact on safety
and working conditions has been the subject of doctrinal controversy in the
specialized literature. On the other
hand, there is consensus among the economists that liberalization has been
successful in taking into account the short-term objectives of transport policy
(lower prices, diversification of supply) but less so at internalising the
medium-term objectives: reduced
congestion of the road infrastructure, pollution control, energy conservation.
of trade and modes of supply this internal liberalization process is of capital
importance. Road transport is
essentially short-haul (for example, in the European Community
66 per cent of loads - measured in tonnes - are delivered within a
radius of less than 50 kilometres), and thus most traffic, particularly in
large countries, is confined within the boundaries of the State. Quantitatively, therefore, mode 3 is by far
the most important and, consequently, will doubtless be one of the main bones
of contention in future negotiations. It
should be noted that the issue of the land?leg of multi-modal transport and
maritime also relates essentially to mode 3.
cross-border supply, mode 1, the international regulations have also begun to
be liberalized mainly, in view of the "intra-continental" nature of
this mode of transport, through regional agreements. Thus, outside the single road transport
market of the European Community, the European Conference of Transport
Ministers (ECTM), an organization linked to the OECD but which has for many
years included the countries of Central and Eastern Europe, administers a
multilateral licence quota,
which even includes "green" and "greener and safe"
categories, and as a first step towards complete multilateralization has
undertaken to standardize the bilateral agreements on a recommended model.
Moreover, road transport is included in NAFTA where it is the subject only of
limited reservations concerning mainly cabotage traffic. Finally, several regional agreements in
Central America and South America concern road transport and have been the
subject of MFN exemptions.
the commitments and MFN exemptions analyzed below, there are no synthetic and
easily accessible data on the international regulatory regime for road
transport in Asia and in Africa. The
industry's overall perception of the barriers (as described by the
International Road Transport Union) is that "the most acute obstacles
facing international road transport can be found on the European continent,
extending to the Middle East and North Africa.
This is due to its high-density population, increasing trade and the
number of borders in such a concentrated area". Consequently, everything should be done to
"ensure that trade and tourism do not face the same barriers in other
regions as they develop, in particular, Asia, Africa and South America, due to
impediments to road transport".
barriers to cross-border trade as perceived by the industry and as described,
for example, in the Final Resolution of the XXVIth Congress of the
International Road Transport Union, held at Marrakesh on 20 March 1998, are not
or only marginally of the type covered by Articles XVI and XVII of the GATS.
of these barriers, according to the industry, is the blocking of roads and
motorways as a result of political and sectorial demonstrations. The industry considers that measures should
be taken in respect of governments which fail to maintain free circulation and
even calls for an independent centralized compensation tribunal to administer
claims for losses due to road blockades, with internationally harmonized rules
covering the eligibility of claims, the standard of proof required for claims
to be accepted and minimum rates of compensation. An attempt to introduce European regulations
along these lines recently failed because States were opposed. In WTO terms, this problem is similar to that
of non-violation, but there is no precedent for basing non-violation on failure
barrier identified by the industry concerns traffic bans at weekends and on
public holidays. The IRU has expressed
the wish that, where driving restrictions currently exist, they should be
reduced to the period from 7 a.m. to 10 p.m. on Sundays and public holidays
only. It also wants a harmonized
regulatory framework to exempt vehicles involved in international transport
from these restrictions. Finally, it
again requests the creation of a supra-national system of arbitration on
driving restrictions, taking into account the demands of road safety,
congestion and the environment. This
point was dealt with in the draft sectorial annexes discussed during the
Uruguay Round (see paragraph 2 above).
barrier mentioned by the IRU concerns border-crossing difficulties. In this connection, the IRU invites
governments to recognize the costs and dislocation of international trade
caused by inefficient and uncoordinated border-crossing procedures, asks all
the States concerned to accede to the international agreements and UN
conventions governing international road transport and apply them in an
efficient and harmonized manner,
and also recommends the development of cooperation between national control
services on each side of the border and the introduction of "one-stop"
technology, improved training of border personnel and improved quality and
capacity of border infrastructure, with international financing institutions
and private investors being invited to finance them. These border-crossing problems seem to be
universal, as evidenced, for example, by a recent Southern African Development
Community document which
estimates that these delays cost its members 48 million dollars every
barrier identified by the industry concerns the issuing of visas for professional
drivers. In this connection, the IRU
calls for the introduction of a driver identification document similar to the
"seaman's passport" which would exempt drivers from having to obtain
a visa. In the event of it not being
possible to abolish visas, the industry proposes the creation of a multilateral
visa system, the acknowledgement of the role of national road transport
associations in acting as intermediaries to obtain visas for their members, the
development of multi-entry visas, the simplification of the procedures, and the
reduction of the time needed to obtain a visa, the number of documents required
and the prices of visas.
of these barriers has been studied and estimated.
Thus, it would appear that border delays account for almost 6 per cent of
transport time in some countries of Central and Eastern Europe. Similarly, French road transport companies
estimate that 12 per cent of transport time is lost due to road blockades. Again according to these studies, total
transport time losses are higher in Central and Eastern Europe (between 17 and
22 per cent) than in Western Europe (between 7 and 16 per cent). In terms of annual costs, these barriers
would appear to account for between 1 and 7 per cent of total transport costs
in Western Europe and between 8 and 29 per cent of total transport costs in
Central and Eastern Europe. Finally, in
terms of GDP, the losses amount to between 0.1 and 0.3 per cent in Western
Europe and between 1.3 and 2.6 per cent in Central and Eastern Europe.
industry also considers that, a variety of measures such as total or partial
bans on transit, quantitative restrictions on road transport which distort
intermodal competition, bureaucracy which prevents forwarders from freely
choosing their mode of transport, quantitative restrictions on road transit in
the form of authorization quotas or limitations on vehicle weights and
dimensions below the levels usually accepted and excessive transit charges all
impair the freedom of transit recognized by Article V of the GATT and the
principle defined in Article V.4, according to which "all charges and
regulations imposed by contracting parties on traffic in transit to or from the
territories of other contracting parties shall be reasonable, having regard to
the conditions of the traffic".
However, it should be noted that Article V has never been invoked in
dispute proceedings (see paragraph 7).
the industry considers that the inadequate harmonization of fiscal charges
(excise duties on fuel, road use charges and tolls) and of technical
regulations (specifying weights and dimensions and making it necessary to
underload goods vehicles in order to comply with the legislation of the transit
country) constitutes a serious barrier, as does the very uneven application of
social legislation concerning driving and rest times (number of controls,
penalties). In this connection, the
literature also mentions the existence in Europe of optimization strategies and
a trend to divert traffic to those countries whose social legislation is less
strict. These comments by the industry
mostly relate to the European Community but it seems that they could also be
extended to other geographical areas.
as regards mode 2, there do not appear to be any serious restrictions.
relatively low wage level and the relatively unsophisticated technology have
meant that there is also little commercial interest in the development of mode
4 trade, which accordingly seems marginal or even non-existent.