Highway Fees

Germany and Toll Collect still feuding as expiry approaches

Montage einer Mautbruecke
We'll never get this fixed in time. Source: Picture Alliance

A legal dispute between the German government and the Toll Collect joint venture that administers tolls for truck traffic on the autobahn have been feuding for over a decade and, with the concession now expiring, are looking for a solution. Berlin wants €5.6 billion from the venture, in which Deutsche Telekom and Mercedes-Benz maker Daimler each have a 45-percent stake, for lost revenue after opening two years late as well as €2 billion in interest. The outstanding 10 percent is held by France’s Cofiroute.

Meanwhile Toll Collect wants €2 billion it say it’s owed by the German government, which reduced the fees it pays in the face of the dispute. So far, the only one making any money is the lawyers, who charge more than €300 per hour.

It’s a never-ending story and Germany is considering drawing a line by restructuring the operating company in time for the expiry of the consortium’s contract at the end of August, government sources told Handelsblatt. The changes could lead to the breakup of Toll Collect into an operating unit and a kind of “bad bank” that takes over the never-ending liabilities and continues the arbitration.

“It's completely crazy.”

Government source, on the tollways dispute

To complicate matters, government lawyers have accused Toll Collect of fraud in its processing of payments. Investigators raided the company last year and an auditing firm was tasked with checking thousands of bills. The case, or cases, pose a risk to the tender process because, as one insider said, “no new buyer wants to be dragged into the arbitration proceedings.” The government has said it wants to free the new operators of any liabilities arising from them.

Arbitration cases are meant to settle disputes quickly but the lawyers appear to have no interest in bringing the highly lucrative proceedings to a close, insiders said. The government has so far paid lawyers €200 million and the consortium is likely to have forked out at least as much.

“It’s completely crazy,” said one government source. Yet the government is partly to blame for the failure of repeated attempts to reach a settlement face-to-face between the CEOs and ministers. That’s because it’s worried about the political backlash if it reaches a deal seen as excessively lenient and a waste of taxpayers’ money. In addition, the fraud aspect of the dispute has made it impossible to reach a political settlement, said government sources.

25 p10 German truck toll-01

Although Telekom and Daimler say they want nothing to do with the company once the concession ends, a motley crew of potential operators has emerged in the tender. The potential operators range from traditional infrastructure companies such as Abertis and Autostrade to technology companies such as IBM and Austria’s Kapsch and even to ticket seller Eventim.

Just what the bidders are bidding on isn’t entirely clear since none would be interested in taking over the legal dispute, hatching the “bad bank” idea. Another option would be for the government to take over Toll Collect and drop the liabilities against itself. But that’s only seen as a theoretical option, sources said.

The government, Daimler and Telekom all declined to comment.

The government may end up running the toll system in any case if there’s a delay in the tender process, which is quite possible because the timetable is tight. All bids must be submitted by the end of February and if one failed bidder takes legal action that case could last six months, well beyond end-August deadline for the start of the new contract.

Daniel Delhaes reports on politics, transport and airlines from Berlin. To contact the author: delhaes@handelsblatt.com

 

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