Mobility Package 1: The rules and their consequences

The Mobility Package 1 was published in the Official Journal of the EU on 31.07.2020, and since its publication until now, additions and new rules have been added which are not favorable for Eastern European carriers at all: trucks must return home every 8 weeks, each driver must be declared in the IMI interface, and the exceptions to the posting are not clear.

1. What is the purpose of the changes brought to Mobility Package 1?

According to the justification of the European Commission, the reason why changes were made in international transport legislation is to maintain the balance between driver safety, social equity, and a sustainable economy.

In reality, the very restrictive changes have a strong impact on the road transport industry in Romania due to the obligation to bring trucks home every 8 weeks and the new rules regarding the posting of professional drivers. After a period of the pandemic that seriously affected many transport companies, especially small and medium-sized companies, there is a risk that a significant number of such companies will not be able to bear the costs generated by the new rules.

2. The changes brought by the Mobility Package 1

The 3 problematic subjects are the following:

  • the new rules for access to the transport market and the profession
  • the special law on the application of the rules of posting in road transport
  • the new rules regarding driving and rest times

2.1. European Regulation 2020/1055 amending the rules of access to the profession and the market of road transport of goods

These rules target both carriers operating vehicles over 3.5 tons, as well as those operating light vehicles between 2.5 and 3.5 tons that are exclusively intended for the transport of goods in international traffic.

The rules for carriers operating vehicles over 3.5 t

Came into force on February 21, 2022 and covers the following topics:

Returning the trucks home after 8 weeks: is the most problematic and restrictive rule in the Mobility Package for Romanian carriers

This provision was included by the European Parliament as a condition regarding the headquarters of the transport companies and the connection with the headquarters, which in reality directly aims at the elimination from the European market of the eastern transporters who are obliged to organize the return of their trucks home every 8 weeks. Romanian carriers cannot ensure the return of the trucks to an operational center that they own in another member state but must organize the return of the trucks to Romania only, as the member state of establishment.

Headquarters: transport companies must have at their disposal several vehicles and drivers that are proportional to the volume of transport operations that the company carries out.

Good reputation: changes have been made regarding the requirement related to the good reputation that a transport company may lose if the new rules regarding posting of workers are violated. It is important to mention that the obligation to return the trucks home is not among the requirements whose non-compliance leads to the loss of a good reputation.

Professional competence: the Member States will be able to request periodic training of transport managers for shorter periods than before (3 years).

Financial capacity: additional clarifications are provided regarding the fulfillment of the financial capacity requirement which can be ensured by a bank guarantee/insurance or other mandatory documents.

Restriction of cabotage: regarding the modification of the rules of access to the road freight transport market, one of the most restrictive provisions that entered into force is the restriction of cabotage by introducing a cooling-off restriction period of 4 days.

Co-responsibility: provisions that allow shippers to be sanctioned if they know/should have known that the transport services that are carried out for them are carried out in violation of the provisions of Regulation (EC) 1072/2009.

The rules for carriers operating vehicles between 2.5 - 3.5 t

Came into force on May 21, 2022 and consider the licensing of operators using light vehicles (greater than 2.5 tons and less than 3.5 tons)

2.2. Directive (EU) 2020/1057 establishing specific rules regarding the posting of drivers in the road transport sector:

The new rules regarding the posting of drivers provide:

  • exemption from posting of transit, bilateral transport operations, and a maximum of 2 cross-trade transports related to a round-trip bilateral transport.
  • application of posting to international cabotage and cross-trade transports
  • IMI public interface: road carriers must submit posting declarations by using the public interface of the Internal Market Information System (IMI)

What is the procedure for declaring posted drivers in IMI?

Step 1: The carrier must create an account in IMI and complete the posting declaration.

Step 2:  Through the public interface, the carrier sends the statement of posting to the host country and a “copy” of this statement will be sent to IMI.

Step 3: the carrier must keep these declarations up to date (according to the IMI regulation, the declarations of posting drivers are valid for 6 months).

Step 4: Through the public interface, the carrier, after the posting of drivers, can receive a notification of the request for documents in IMI from a member state – it will have a period of 8 weeks to send the requested documents through IMI.

Step 5: the transport operator will be informed about the closing of the request for documents and will be informed about the final result of the control.

How will the control of the carriers regarding the posting be carried out?

The Directive 1057 has provisions regarding both the control carried out at the company headquarters through the IMI interface, as well as the control in traffic (the directive provides for a simplified number of documents that the driver must have on board and that he must present to the control officers: the declarations printed/electronic documents, proof of transport (CMR) and tachograph records (here it will be checked if the driver has correctly registered the country code).

When do the rules of posting apply and when do they not? It depends on the type of transport - bilateral/ cross-trade:

According to the new rules, a driver is not considered posted if:

  • transits a member state;
  • carries out bilateral transport operations;
  • 1+1 cross-trade (related to a bilateral, round-trip transport): means that in addition to carrying out a bilateral transport operation, it carries out a loading and/or unloading activity in the member states or in the third countries it crosses (on the condition that it is not cabotage). In short, for a bilateral transport departing from Romania, it can carry out a cross-trade operation that is exempt from the detachment, and for the bilateral return transport, it can also carry out a cross-trade operation that is to be excluded from the posting.
  • 0+2 cross-trade: if he did not carry out any cross-trade operation on the bilateral transport while departing from Romania, he can carry out up to 2 cross-trade operations on the way returning home, and would be exempted from the provisions of the posting directive.

2.3. Modification of the rules regarding driving and rest times of drivers and tachograph

From February 2022, the rules regarding the obligation of car drivers to register manually the country’s symbol after crossing the border came into force to allow verification of compliance with the rules of posting.

3. What rules apply to non-EU shipments?

Non-EU shipments operated by Romanian carriers

For a transport carried out by a Romanian carrier from Germany to Turkey or vice versa, the European Commission stated that the posting rules apply only on the territory of the European Union (other third countries do not have rules regarding posting).

EU shipments operated by non-EU carriers

Although the directive stipulates that carriers from third countries cannot benefit from a more favorable treatment than EU carriers, the directives are at the discretion of the member states, to negotiate bilateral/multilateral agreements for the access of these carriers to the Union market and the application of the rules of posting.

For Great Britain, the EU-UK transport agreement respects the posting rules, the UK authorities can connect to IMI, which means that UK carriers can access the IMI interface to submit posting declarations.

The other non-EU countries have the following 2 options: either to conclude bilateral/multilateral agreements with third countries or to use the national platforms that already exist in some countries for third-party carriers.

4. The impact of the new rules on carriers, the environment, and the market

It is not at all surprising that the biggest challenge for Romanian carriers is the obligation to return trucks to the base every 8 weeks. This rule will strongly impact both their administration/operating costs, as well the environment, by increasing the level of CO2 emissions.

Impact on costs

According to the report published by TI, there is the possibility that the pressure on the capacity will increase costs since the balance between demand and supply tilts in favor of the suppliers.

For this reason, it is expected that transport prices will increase, and carriers will bear the additional costs that are a result of the new obligations (additional costs related to fuel, labor, etc.)

TI analysts claim that carriers from Eastern Europe may be more willing to partially absorb the impact of additional costs, to maintain their competitive advantage in the market. According to the TI report, it is estimated that 99.8% of trucks that have cycles longer than 8 weeks will be operated by carriers from Eastern Europe.

The impact of applying the posting rules to road transport in Romania will be significant; the administrative/operating costs of the carriers will increase because they must know and calculate the monthly remuneration for drivers according to the national rules of the 27 member states (rules that are not yet fully known and transparently published for the information of the carriers).

Impact on capacity

Taking into consideration the pressures on the capacity that we have seen in the last year, it is expected that the situation will worsen even more because few trucks can make cabotage runs as a result of the rules of returning home.

It is predicted that this rule will have a major impact on the capacity of the market because when returning home, there is a risk of not being able to secure additional loads. Eastern European carriers will be most affected by this, as there are limited market opportunities to and from their operational hubs.

Impact on the environment

This increase in emissions is the result of the rising number of races, many of which are expected to be with empty trucks. According to a report published by Transport Intelligence, it is estimated that C02 emissions will increase by 2.9 million by the year 2023 (representing a 4.6 percent increase compared to the current value).

In conclusion, TI claims that “Although the new rules bring an improvement in the working conditions of professional drivers, it is possible that they lead to costs increase, but also to a reduction in the real transport capacity.”

Many representatives of transport companies in Eastern Europe say that the new rules introduced by Mobility Package 1 will greatly affect them. These rules create additional operating costs for Eastern European carriers and put them at a disadvantage compared to their competitors, Western European carriers.

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