Controversial truck tolling system likely to remain in place until 2019

The Czech government on Monday approved the prolongation of a contract with the Austrian company Kapsch to operate a controversial nationwide truck tolling system for another three years. The transport ministry’s failure to select a new operator and the ministry’s intention to prolong the contract with Kapsch without a tender has come under fire from both the coalition and opposition lawmakers and may well result in a court battle.

Photo: Miloš Turek

The 10-year contract with Kapsch, signed in 2006, has been a thorn in the side of several Czech governments. The microwave-based truck tolling system was criticized for excessive costs and disappointing returns to state coffers and the contract was seen as flawed in ruling out the widest possible competition between companies that could provide the Road and Motorway Directorate with the infrastructure to register, track and charge the lorries using Czech roads, basically favouring the microwave-based system over satellite technology.

Despite widespread criticism, both the current transport minister, Dan Ťok, and his predecessors, failed to prepare the ground to end the country’s dependency on Kapsch and reach consensus on what kind of system the country would favour after 2016, when the contract with the Austrian firm is due to expire. At Monday’s cabinet meeting Transport Minister Ťok had to admit defeat and tried to convince his colleagues in cabinet that the best option was to retain the status quo for another three years.

Although the cabinet was clearly not happy with the decision, it gave its consent for the contract to be extended, but stopped short of approving a proposal for this to be done without a tender. Prime Minister Sobotka said that under the circumstances there was little choice but to preserve the status quo until a new tender could be prepared.

Bohuslav Sobotka, photo: Khalil Baalbaki

“It is in the government’s primary interest to secure the functioning of a tolling system on Czech territory. A fall-out would have meant significant losses to state coffers and would have resulted in the country being overrun by trucks.”

However, not everyone appears satisfied with the transport minister’s arguments that everything possible had been done to end the country’s dependency on Kapsch and the opposition has accused him of sleeping on the job. Extending the contract with Kapsh without a tender would mean handing the current supplier 6 billion crowns, approx. 221.9 million euros, while disqualifying possible rivals. The company SkyToll which operates the tolling system in Slovakia has already threatened to take such a decision to court. Opposition TOP 09 deputy František Laudát says the Czech Republic is certain to face serious problems over the decision.

“The government approved the worst possible solution to the problem. I would say, with utmost certainty, that this will be seen as a breach of the law on public tenders. And I think the transport ministry will find it hard to prove that it did everything in its power to end the Kapsch monopoly in this field. They clearly did not and they have no evidence to the contrary."

František Laudát, photo: archive of TOP 09

The government’s decision is now likely to be reviewed by the country’s anti-monopoly office and rival firms may press lawsuits. If it is ruled as being in violation to the law, the tolling system would end at the close of 2016, resulting in loss of state revenue and severe traffic complications.