The Polish Way – 2

DB Schenker sends a lot of its freight by sea. Photo bahnimbild.de.

Poor old PKP Cargo. Not only is the economic crisis bleeding it of the revenue from highly profitable services such as carrying iron ore or aggregates. But UOKiK, the Polish Government’s Office for Competition and the Protection of the Consumer has just fined the Company a staggering 60 million zloty (12.2 million GBP).

What have PKP Cargo bosses been guilty of? They have done nothing more than operate according to principles which are standard business practice all around the world – they have given certain of their customers – with which Cargo has formed strategic alliances – additional discounts which they do not make generally available.

PKP Cargo hardly works in an uncompetitive environment. The independent Polish freight operators are increasing their share of Poland’s rail freight traffic year by year and DB Schenker – part of the German state owned railway operator – has just acquired a significant share of the Polish market with its purchase of PCC Rail.

I find it difficult to understand how adding 60 million zloty to PKP Cargo’s deficit – which already is in the range of several hundred million zloty – will make the Polish rail freight market any more competitive.

Perhaps someone should tell UOKiK that they should look at the freight market as a whole where road operators enjoy a subsidized ‘track’ for which their taxes and toll payments do not begin to pay for the wear and tear caused by their vehicles.

Come to think of it, UOKiK can’t even make my local shoe shop exchange my shoes when I find that a new shoe splits after one days wear. Perhaps the best move for the government would be to abolish UOKiK altogether?