19 October 2021

Penalties for road transport companies and how to challenge them

Category: Transport law

The Erru register, introduced on 1 April 2021,  is a another addition to road transport regulation that may bother transport operators. Small errors or mistakes may cause penalties that mau add up to withdrawl of the Euro-licence.  Road transport companies therefor need to keep a clean sheet. Blenheim advises road transport companies to stay on track. In this blog we line out the European Register of Road Transport Undertakings (ERRU).

European Commission on the ERRU register for road transport companies:

“ERRU (European Registers of Road Transport Undertakings), is an electronic system that allows Member States to exchange information on road transport companies. ERRU interconnects the national electronic registers on road transport undertakings of the different Member States, so that the competent authorities can mutually exchange information contained in their respective databases.

The set-up of the national electronic registers and their interconnection are required in Article 16 of Regulation (EC) No 1071/2009 on the access to the profession of road transport undertakings. ERRU, which is operational since 1 January 2013, has been progressively adapted in order to respond to a growing number of needs related to the enforcement of road transport legislation. The current version of ERRU provides information, among others, on the good repute of transport managers, on the validity of community licences and on infringements committed by transport undertakings in foreign territory. As of 2023, ERRU will be again adapted in order to include the information on risk rating of the transport undertakings and additional information facilitating the detection of letterbox companies.” In the Netherlands Niwo is the licensing authority, and ILT is the supervising authority.

When is good repute of road transport operator in danger?

Regulation No 1071/2009 “governs admission to, and the pursuit of, the occupation of road transport operator” (Article 1(1)) and applies to all undertakings established within the Community that engage and intend to engage in the occupation of a road transport operator (Article 2 (2)). A requirement to engage in this occupation is to “be of good repute” (Article 3 (1) (b)). The conditions relating to this requirement are laid down in Article 6 of the Regulation and discuss the conditions that need to be met. To elaborate, there shall be no compelling grounds to doubt the good repute of a transport manager or the undertaking itself. These grounds include penalties for any serious infringement of national rules (Article 6 (1) (a)). Annex IV discusses the types of infringements that could lead to the loss of good repute after it has been found that there was no disproportionate response at hand. Each Member State needs to designate one or more competent authorities to ensure that the Regulation is correctly implemented but, furthermore, to carry out the requisite checks to verify whether the requirements laid down in Article 3, including the condition of good repute (Article 10 (1) (d)), are met.

Transport Authority in the Netherlands: NIWO

In the Netherlands, the competent licensing authority is the ‘Nationale en Internationale Wegvervoer Organisatie’ (NIWO) which has been the license provider for road transport in the Netherlands for many years. The Human Environment and Transport Inspectorate (ILT) is the authority that registers irrevocable sanctions in the bus and road transport sector in a national register. These are sanctions imposed by the ILT on Dutch and other European road transport or bus companies. They are required to monitor and carry out checks whether undertakings are fulfilling the requirements laid down in Article 3 of the Regulation. If NIWO decides that an undertaking runs the risk of not being able to fulfil one or more of these requirements, they may set time limits for the undertaking to rectify the situation (Article 13 (1)). These time limits depend on the situation itself (Article 13). If, however, the undertaking is found to not satisfy the conditions of Article 3, it may be required to withdraw or suspend their authorisation to engage in the occupation within the time limits referred to in Article 13 (1). A negative decision needs to have underlying reasons on which the decision is based while taking into account the available information concerning infringements and specifying the rehabilitation measures that are applicable in the event of a suspension or a declaration of unfitness (Article 15 (1)).

Appeal procedure against NIWO decision

In the Netherlands there is a possibility to appeal the decisions, such as a penalty or withdrawl of the licence, referred to in paragraph 1 of Article 15 in front of at least one independent and impartial body or a court of law. The “data concerning an undertaking whose authorisation has been suspended or withdrawn will remain in the national electronic register for 2 years from the expiry of the suspension or the withdrawal of the license and shall thereafter be immediately removed” (Article 16 (3)). EU Member States are expected to lay down the rules regarding the penalties that occur due to the infringements of the Regulation. You can read more here about appeal against a decision from Niwo.

Dutch policy rules on good repute of road transport operator

In the Netherlands, the NIWO has, accordingly, employed its ‘Policy Rule’ regarding the implementation of the penalty system mentioned in Regulation No 1071/2009. This ‘Policy Rule’ discusses the proportionality test and penalties in the event of loss of good repute with regard to the transport of goods by road. It covers both the understanding of ‘most serious infringements’ within the understanding of the Community rules in Annex IV of Regulation 1071/2009 and ‘penalty points’ which are points that are attributed to the road transport operator committing ‘most serious infringements’ (MSI). The loss of good repute as discussed in Article 3 of Regulation 1071/2009 may, under the Dutch Policy Rule, not be disproportionate where the number of penalty points are exceeded related to the undertaking pursuant to Article 5 of the Policy Rule. The penalty system is further laid down in Article 4 where the number of penalty points to be attributed for the most serious infringements is pronounced.

Supervisory body ILT register convictions and penalties of transport company

The penalty points that are attributed by the Dutch Human Environment and Transport Inspectorate (Inspectie Leefomgeving en Transport) are added up within a period of two years and will also lapse after two years when the respective conviction or penalty due to a MSI of Community rules has become final and conclusive (Article 4 (2)(3)). NIWO will give the road transport operator a written warning after at least 50% but not more than 100% of the minimum number of penalty points have been reached (Article 6 (1)) and will apply the proportionality test (Article 6 (2)).

Proportionality test for actions road transporter

NIWO may consider a disproportionate response regarding the loss of good repute to be at hand where:

  1. the acts of third parties forming the basis of the most serious infringements have had a material influence;
  1. there is a non-attributable lack of knowledge about the facts and circumstances which led to committing the said infringements while having had knowledge of it would have prevented the infringements, or
  1. there is a different force majeure situation to be demonstrated by the road transport operator showing that he cannot be blamed for one or more infringements (Article 7 (1)).

Furthermore, NIWO determines that the loss of good repute of the road transport operator is a disproportionate response if the transport manager can demonstrate that he durably restricted the commitment of the respective infringements by:

  1. giving the necessary and knowable instructions to the drivers;
  1. taking structural measures in the management aimed at stimulating compliance with the regulations in which the most serious infringements are penalised or imposed with fines;
  1. providing the driver with the necessary resources to comply with the regulations meant under b; and
  1. conducting supervision reasonably to be demanded with regard to the items a up to and including c (Article 7 (2)).

Procedure for penalties and withdrawl of Euro-licence

The ILT informs bus and road transport companies when they receive penalty points for the first time. The company also receives notification when they reach 50% of their threshold. This gives them the opportunity to improve compliance. Transport companies, bus transport companies and transport managers can request their number of points from the ILT.

The National and International Road Transport Organisation (NIWO) issues permits to companies in goods transport, for passenger transport it is KIWA. If the ILT judges the reliability of a road transport company to be insufficient, the ILT advises the NIWO to withdraw the permit. In the case of bus transport, the ILT itself decides to withdraw the licence. A road transport or bus company can then lose its licence for 2 years. If the ILT judges the reliability of a transport manager to be insufficient, he or she may be declared unfit for 2 years. Any decision of Niwo, is subject to appeal and judicial review. In case of urgent situations, e.g. if a licence is withdrawn,  the administrative court may suspend a decision.  

Solo actions and the risk for the transport operator

Where the transport manager by his solo performance or actions contrary to the company’s steady policy, can be held responsible as the sole person for committing or having committed most serious infringements, the loss of good repute of the road transport operator is disproportionate (Article 7 (3), Article 8 (3)).

The proportionality test that NIWO conducts should guarantees a due care investigation by the Dutch Human Environment and Transport Inspectorate (Article 9 (1)) and includes both an advisory report as outlined in Article 9 (2) (a) and a point of view expressed by the road transport operator as outlined in Article 9 (2) (b). The circumstances taken into account upon preparing the decision to withdraw or suspend the Community license are further lined out in Articles 10, 11 and 12. The accumulated penalties are deleted once a suspension or withdrawal of the Community license has occurred (Article 13) and the rehabilitation period amounts to two years (Article 14).

Blenheim assists transport companies with regulatory compliance and procedures. Feel free to contact us.