June 05 2019
By Tim Deakin

Tim is Editor of routeone and has worked in both the coach and bus and haulage industries.

Lords: Lack of guidance leaving CTOs 'in limbo'

Non-commercial interpretation remains in the air until Judicial Review decision comes during 2020

House of Lords alleges that communitry transport has been ‘left in limbo’

The government has been criticised in the House of Lords for proceeding with changes to bring the UK in line with EC Regulation 1071/2009 while a Judicial Review (JR) brought by the Bus and Coach Association (BCA) is ongoing.

The JR will deliver a definitive interpretation of the term “exclusively non-commercial”. The result is expected in 2020. The DfT, and representatives of Section 19 and Section 22 permit holders, formerly agreed that it equated to not-for-profit, but the BCA argues otherwise.

‘Left in limbo’

That leaves the community transport sector in limbo and has created “a yawning gap in the… definition of ‘non-commercial organisations’,” says Baroness Randerson.

She also criticised a lack of comprehensive guidance on the application of the 10-mile exemption that is part of steps to make the UK comply with the Regulation. In particular, she argues that further help is required for permit holders in rural areas.

Responding to Baroness Randerson, Parliamentary Under-Secretary of State Baroness Vere reinforced the need for a fair playing field when contracts are tendered between operators that hold an O-Licence and those that utilise permits.

She says that the government is “bound to implement” the Regulation, which will introduce the need for an O-Licence for many permit holders.

‘Not legally sustainable’

Baroness Vere adds that the government cannot provide guidance on the interpretation of non-commercial while the JR is underway. However, it has previously advised contract-issuing bodies that they should continue to award contracts to permit holders until the JR concludes. “Once the High Court has reached a decision, the government will revise its guidance.”

CTOs that satisfy the main occupation or short distance exemptions do not need to wait for the judgment. The government believes that 50% of permit holders will meet the former. It does not know how many will be able to take advantage of the latter.

Baroness Vere adds that the former blanket exemption from EU law is “not legally sustainable.”