1. Development and significance
After the first rail connections in several European countries started to operate in the first half of the 19th century, carriage by rail quickly gained momentum and soon developed into the primary means of transport on land. As the transport of goods as well as persons was of such eminent significance for the commercial and industrial development of every single country and was also of major importance in military conflicts, rail development enjoyed strong governmental support consistent with the needs of the sponsoring country. This resulted in national rail markets, operated by integrated national rail companies, that offered transport services and also built and maintained the track network. As the technical framework differed from country to country, cross-border traffic was subsequently confronted with a lack of uniformity in areas such as track gauge, voltage and the training standards of railway staff. Instead of a standardized European rail system, the result was an unsatisfactory series of national rail systems which impeded transport speed and generated extra costs, putting rail at a disadvantage in the competition with other modes of transport, particularly road transport. Consequently, goods and passenger rail transport lost significance over the course of time. While the total output of rail transport services has remained roughly the same, it has seen a substantial drop in market share, mainly in favour of road transport, as the overall volume of transport of goods has increased. In regard to the transport of persons, the growing number of private cars and the expansion of air traffic have also had a negative impact. Nonetheless, environmental and safety concerns—areas where rail excels—give hope for a renaissance.
In the future, rail freight will represent an environmentally sounder alternative to increasingly overstrained roads. Today, it has already assumed a growing significance due to the use of standardized loading units, eg containers, which are functional across different means of transport (multimodal transport). In the transport of persons, a shift away from the airplane, particularly on high speed routes, can be expected. Thus, assuming suitable offers, the railways will also be an attractive alternative to individual road traffic over short distances.
2. Tendencies in the development of private law
The increasing importance of the carriage of goods by rail in the second half of the 19th century gave rise to a number of special rules for rail transport within the general provisions of transport contracts; some were already in existence in the Allgemeines Deutsches Handelsgesetzbuch (ADHGB), ie the German Commercial Code of 1861. These provisions contained mandatory minimum standards to the benefit of rail customers, addressing a general concern among shippers about the standard terms and conditions unilaterally imposed by the monopolistic rail companies which were usually not subject to individual negotiations (carriage, contract of). Additionally, the development of private law in Europe in the area of rail transport was an early success for the international effort to standardize the applicable rules: the provisions of the CIM influenced national rail carriage law. Even in its later versions, international railway law remained a model for national law reforms, such as those undertaken in Germany, Austria, Switzerland, the Netherlands, Italy, Norway and Poland.
3. International Conventions
The potential offered by rail freight was also taken advantage of in international goods exchange. Due to the characteristics of international rail transport contracts, particularly because of the mutual dependence of the railway companies involved in the supply of rail services, the divergence of national provisions turned out to be a hindrance. That realization explains why efforts to develop an international agreement for rail freight began early. This desire led to the first Convention concerning transport law, the CIM in 1890, which was the very first convention in transport law and the predecessor of the present day UR CIM. In 1924 the CIV, predecessor of the present day UR CIV, was approved for the transport of persons. Tsarist Russia was a signatory to the CIM, but the Soviet Union did not continue its membership after World War I. The East European socialist nations later developed their own rules for international rail freight (SMGS) and passenger transport (SMPS), although some countries belonged to both systems.
From their inception, regular revision of both the CIM and CIV was envisioned in order to adapt international rail transport law to changes in circumstances over time. In this manner, in contrast to air transport (air transportation (contractual liability)), legal uniformity could be preserved. International contracts for carriage by rail required a high degree of unified rules: although concluded between the consignor and the railway of his country, all succeeding railways became a party to that contract by taking over the goods and the consignment note issued for the entire route. Simplified procedures for revision developed early in some areas, particularly for the provisions concerning dangerous goods (RID) which can be amended without the need for ratification by individual member countries.
The structural amendment of international rail transport law—sought for decades—was finally achieved in 1980 at the Eighth Revision Conference in the form of COTIF. The basic Convention contains institutional provisions; parties to this Convention are members of OTIF, the Intergovernmental Organization for International Carriage by Rail. They are, among other tasks, in charge of continuing the development of international rail carriage law in various organs of OTIF. Special rules guarantee the preservation of the already achieved legal uniformity notwithstanding ongoing revisions. The actual rail transport law, ie the amended UR CIV and UR CIM, was incorporated as two appendices into the Convention, whereas RID, RIP, RICo and RIEx were added as annexes to UR CIM. These annexes and appendices are integral parts of the Convention.
Soon after taking effect in May 1985, it became evident that COTIF 1980, oriented towards the national rail monopolies still prevalent in Europe, would not be able to meet the challenges to private law presented by imminent regulatory change. Like its predecessor, it retained the system of registered lines, mainly operated by national integrated rail companies. The result was a collective responsibility of successive railways, each carrying only on its own tracks and consigning the train with goods and passengers to the next railway at the border. The cooperation of subsequent railways was ensured by a duty to carry and a list of compulsory fares, thereby not only guaranteeing a cross-border transport service, but also access for any customer such that no one could be barred.
However, this conception was incompatible with measures to replace the system of national railways in the EU. In addition, as a consequence of the opening of the eastern countries and the international trade connections which were becoming more and more important, an expansion of the number of OTIF members seemed desirable, particularly for the east. COTIF 1999 takes these changes into account.
In a contract for the carriage by rail, the parties are no longer consignor and railway, but consignor and carrier; in the transport of persons they are designated as carrier and passenger. The scope has been expanded by abolishing the close connection with national lines and services as in COTIF 1980. Transit countries no longer need to be members of COTIF since the rules apply so long as the place of departure and the destination are located in two OTIF member countries. Railways are no longer under a duty to carry at fixed fares. International cooperation is now a matter of contractual agreements between the carriers involved. The contractual freedom between carrier and customer as well as amongst rail companies has been extended.
The elimination of the traction monopoly held by the national railway companies over their respective track networks has created a new potential for international rail transport. A carrier may now do business as sole contractual carrier using his own infrastructure and that of other railways or, as before, in cooperation with other succeeding carriers. Moreover, he is permitted to engage a substitute carrier. The annexes to CIM, RIP, RICo and RIEx have been abrogated as they became outmoded due to the change in the economic base of European rail traffic.
The international law concerning dangerous goods (RID) has been converted into an independent Appendix C to COTIF. In Appendices D through G, new provisions on the use of vehicles (CUV), the use of infrastructure (CUI), compulsory technical standards (APTU) and technical admission of rail material (ATMF) have been adopted. UR CIV and UR CIM remain as Appendices A and B. In the revision of CIM, the special needs of SMGS-countries were taken into account with the purpose of motivating more countries to join OTIF and facilitating a continuous rail transport from the Atlantic to the Pacific Ocean. COTIF 1999 has the potential to achieve this: according to Art 1(2) CIM, the uniform rules can be applied so long as the point of departure and the destination are situated in two different countries, of which only one need be a member state of COTIF, and the parties to the transport contract agree to apply the uniform rules.
Although the COTIF reform came into effect on 1 July 2006, it is not yet in force in all 45 member countries, especially the European countries. Ireland, Italy and Sweden have still not ratified the 1999 Protocol. In addition, at the request of the European Commission, several member countries gave notice of reservations according to which the three appendices (E to G) of the agreement (CUI, APTU and ATMF) would not be applied in their entirety because they are regarded as being in conflict with EU law to some extent. With these reservations, the threat of infringement proceedings is to be avoided.
4. European rail transport law
The EU was initially slow to take steps to promote rail as a safe and environmentally sound means of transport. However, rail is now given top priority when measures are taken in the field of transport policy. The aim is a single European railway system created through the integration of individual Member State’s systems. The necessary reforms have the task of disengaging Europe’s rail systems from the outmoded national rail structure and transforming them into market oriented enterprises. Increased investments in infrastructure are intended to improve their attractiveness.
Directive 440/1991 was the first step in this direction, granting access, in some areas of rail traffic, to other Member State countries’ railways for the supply of transport services on foreign tracks; it thereby established a distinction between the operation of infrastructure and the provision of transport services.
In March 2004, the Commission proposed its so-called third railway package. Alongside a continuation and intensification of earlier efforts towards liberalization (and accompanying measures), the proposal also contained for the first time minimum standards for contracts for the carriage of goods as well as passenger transport, including particularly compensation for delays (COM(2004) 143 and 144 final). In the end, however, these provisions were implemented only partially or in a significantly modified form as compared to the initial proposal. More recently, the EU has issued comprehensive private law standards for rail transport (Reg 1371/2007) although only for the transport of persons. This has been done in a manner similar to the regulation applicable to air transport (Reg 889/2002), ie by declaring the Montreal Convention applicable to domestic traffic (air transportation (contractual liability)). The scope of application of CIV has accordingly been extended to purely domestic traffic. This regulation includes not only basic regulatory activities but also provisions about the transport of persons with a disability and/or restricted mobility, a concern that was dealt with in a separate regulation (Reg 1107/2006) in air transport law. It also sets a minimum standard regarding liability for the carriage of passengers and luggage within the framework of the CIV; rules of national law that grant passengers further compensation remain unaffected (Art 11). It is only concerning delays that independent passenger entitlements are established which exceed those found in CIV (Arts 16–18); modelled after air transport law, an obligation for advance payment in case of injury has also been decreed (Art 13).
To promote economic integration COTIF 1999 provided the opportunity for regional organizations to join the Convention. In the second railway package, the EU declared joining COTIF as one of its aims (COM(2002) 24 final), and it was finally authorized by the Council to enter into negotiations with OTIF. These negotiations, however, have not yet been concluded. They are subject to a certain tension due to the efforts of OTIF to create a full-fledged international railway organization following the model of the International Maritime Organization (IMO) or the International Civil Aviation Organization (ICAO); the EU in contrast considers matters such as the establishment of technical specifications for interoperability as falling under its exclusive competence.
Béla von Nánássy, Das internationale Eisenbahnfrachtrecht (1956); Joseph Haenni, ‘Carriage by Rail’ in IECL XII (1973) ch 2; Marc Allégret, ‘Historique des conventions CIM, CIV, COTIF et des unions ou organismes internationaux ferroviaires’  Zeitschrift für den internationalen Eisenbahnverkehr 3; Gerfried Mutz, ‘Eisenbahntransport – Internationales Recht’ in Münchener Kommentar zum Handelsgesetzbuch, vol VII (1997); Beate Czerwenka, Christian Heidersdorf and Martin Schönbeck, Eisenbahn-Beförderungsrecht (4th edn, 2001); Anusch Alexander Tavakoli, Privatisierung und Haftung der Eisenbahn (2001); Rainer Freise, ‘Reform der Reform des Eisenbahntransportrechts in Europa?’  TranspR 377; Mihael A Pohar, Rechtsbeziehungen zwischen Fahrgast und Eisenbahn (2006); Rainer Freise, ‘Neue Entwicklungen im Eisenbahnrecht anlässlich des Inkrafttretens des Übereinkommens COTIF 1999’  TranspR 45; Rüdiger Schmidt-Bendun, Haftung der Eisenbahnverkehrsunternehmen (2007); Sandie Calme, L’évolution du droit des transports ferroviaires en Europe (2008); Rainer Freise, ‘Internationaler Eisenbahnverkehr’ in Münchener Kommentar zum Handelsgesetzbuch, vol VII (2nd edn, 2009).