Draft East Anglia franchise agreement

590 Pages·2015·3.96 MB·English

ITT Issue Version 3 17.09.15

Dated [201]

(1) The Secretary of State for Transport

(2) [FRANCHISEE]

Draft franchise agreement revised and republished 17 September 2015

EAST ANGLIA FRANCHISE AGREEMENT

Guidance Note to Bidders: The franchise agreement should be read together
with the Explanatory Note which is to follow and sets out the changes to the
Franchise Agreement since the issue of the Northern and TPE Competition
Agreements in April 2015.
CONTENTS

Clause Page
1. INTERPRETATION ........................................................................................ 1
2. AGREED DOCUMENTS .................................................................................. 4
3. DEFINITIONS .............................................................................................. 5
4. COMMENCEMENT ...................................................................................... 89
5. DURATION OF THE FRANCHISE AGREEMENT ................................................ 90
6. GENERAL OBLIGATIONS............................................................................. 90
7. ASSIGNMENT............................................................................................ 91
8. CHANGE OF CONTROL AND FACILITATION FEE ............................................. 91
9. COMPLIANCE WITH LAWS .......................................................................... 92
10. CUMULATIVE RIGHTS AND REMEDIES ......................................................... 92
11. DISPUTE RESOLUTION PROCEDURE ............................................................ 93
12. NOTICES .................................................................................................. 95
13. SET-OFF................................................................................................... 96
14. MISCELLANEOUS PROVISIONS ................................................................... 96
15. ENTIRE AGREEMENT .................................................................................. 98
16. GOVERNING LAW AND JURISDICTION ......................................................... 99
1 Passenger Service Obligations ................................................................... 101
SCHEDULE 1.1 ......................................................................................... 102
Franchise Services and Service Development ............................................... 102
Part 1 - FRANCHISE SERVICES .................................................................. 102
1. Franchise Services .............................................................................. 102
2. Restrictions relating to Franchise Services ............................................. 102
3. Restrictions on Closures of Railway Passenger Services or Railway
Facilities .................................................................................................. 103
4. Subcontracting any Passenger Services ................................................. 104
5. Station Services ................................................................................. 104
6. Light Maintenance Services ................................................................. 105
7. Ancillary Services ............................................................................... 105
8. Royal Train ........................................................................................ 108
Part 2 - SERVICE DEVELOPMENT ................................................................ 109
9. Train Service Requirement - Purpose And Responsibility ......................... 109
10. Train Plan .......................................................................................... 109
11. Consultation on Significant Alterations to the Timetable .......................... 110
12. Timetable Development Rights ............................................................. 111
13. Certification and Notification by Franchisee of Exercising Timetable
Development Rights ................................................................................. 114
14. Planning to meet Target Passenger Demand .......................................... 114
15. Capacity Mitigation Plan ...................................................................... 116
16. New or amended Train Service Requirement by the Secretary of State
and Franchisee Informed Opinion ............................................................... 117
17. Procedural Arrangements and Timescales .............................................. 118
18. Obligations in relation to other Train Operators ...................................... 119
19. Provisions relating to Access Agreements and Property Leases ................. 119
20. The Timetable and Network Rail's Working Timetable ............................. 120
SCHEDULE 1.2 ......................................................................................... 121
Operating Obligations ............................................................................... 121
1. Daily Operating Obligations ................................................................. 121
2. Timetabling and Train Planning Compliance Investigation ........................ 121
3. Timetable changes proposed by Network Rail ........................................ 123
4. Timetable changes proposed by the Franchisee ...................................... 123
5. Timetable changes requested by the Secretary of State .......................... 124
6. Obligations of the Franchisee in the event of disruption to railway
passenger services ................................................................................... 124
7. Obligation to use all reasonable endeavours under this Schedule 1.2 ........ 125
SCHEDULE 1.3 ......................................................................................... 129
NOT USED ............................................................................................... 129
SCHEDULE 1.4 ......................................................................................... 130
Passenger Facing Obligations ..................................................................... 130
1. Publishing the Timetable ..................................................................... 130
2. Communicating Late Timetable Changes ............................................... 131
3. Fares Selling Restrictions .................................................................... 132
4. Passenger's Charter ............................................................................ 134
5. End to End Journeys and Cycles ........................................................... 136
6. Statutory Notices ............................................................................... 136
7. Train and station cleaning ................................................................... 136
8. Publication of Performance Data ........................................................... 137
9. Publication of Complaints and Faults Handling Data ................................ 138
SCHEDULE 1.5 ......................................................................................... 140
Information about Passengers ................................................................... 140
1. Passenger Numbers Information .......................................................... 140
2. Manual Passenger Counts .................................................................... 141
3. Technology for Obtaining the Information Referred to in paragraph 1.2 .... 142
4. CRM Data .......................................................................................... 142
5. Yield Management Data ...................................................................... 143
6. Personal Data - General Provisions ....................................................... 143
7. Rail Passenger Counts Database .......................................................... 145
8. Intellectual Property Rights and General Provisions ................................ 147
SCHEDULE 1.6 ......................................................................................... 150
The Composition of the Train Fleet ............................................................. 150
1. Purpose and Definitions ...................................................................... 150
2. The Composition of the Train Fleet ....................................................... 150
3. Changes to the Train Fleet................................................................... 152
4. Rolling Stock Testing and Commissioning .............................................. 152
5. Controlled Emission Toilets .................................................................. 153
6. Baby Changing Facilities ...................................................................... 153
7. Metered Train Operator Status ............................................................. 153
APPENDIX TO SCHEDULE 1.6 ..................................................................... 154
SCHEDULE 1.7 ......................................................................................... 155
Stations .................................................................................................. 155
1. Station Asset Management .................................................................. 155
2. Station Maintenance Obligations .......................................................... 159
3. Station Condition Account ................................................................... 161
4. Uninsured Events and Latent Defects Liability ........................................ 164
5. Registration of Title ............................................................................ 166
6. Grey Assets ....................................................................................... 166
7. Station Social and Commercial Development Plan .................................. 166
8. Consultations ..................................................................................... 167
9. Principles of Inclusive Design ............................................................... 167
10. Security at Stations ............................................................................ 167
11. Information about Station Improvement Measures ................................. 168
12. Termination ....................................................................................... 168
APPENDIX 1 TO SCHEDULE 1.7 .................................................................. 170
APPENDIX 2 TO SCHEDULE 1.7 .................................................................. 172
Information about Station Improvement Measures ....................................... 172
APPENDIX 3 TO SCHEDULE 1.7 .................................................................. 173
Minimum Asset Remaining Life Table .......................................................... 173
APPENDIX 4 TO SCHEDULE 1.7 .................................................................. 174
Figures for Calculation of Annual Condition Amount ...................................... 174
2 Assets, Leases, Third Parties, Other Franchise Operations and Schemes .......... 175
SCHEDULE 2.1 ......................................................................................... 176
Asset Vesting and Transfer ........................................................................ 176
1. Vesting of Property Leases .................................................................. 176
SCHEDULE 2.2 ......................................................................................... 178
Security of Access Agreements, Rolling Stock Leases, Station and Depot
Leases .................................................................................................... 178
1. Novation of Access Agreements during the Franchise Term...................... 178
2. Rolling Stock Related Contracts and insurance arrangements ................... 179
3. Cascaded Rolling Stock and Delayed Cascaded Mitigation Plan ................. 180
4. Assignment of Property Leases during the Franchise Term....................... 182
5. Station and Depot Leases .................................................................... 183
6. Station Subleases ............................................................................... 183
SCHEDULE 2.3 ......................................................................................... 185
Other Franchisees .................................................................................... 185
1. Other Franchisees .............................................................................. 185
SCHEDULE 2.4 ......................................................................................... 186
NOT USED ............................................................................................... 186
SCHEDULE 2.5 ......................................................................................... 187
Transport, Travel and Other Schemes ......................................................... 187
1. Local Authority Concessionary Travel Schemes ...................................... 187
2. Multi-modal Fares Schemes ................................................................. 188
3. Discount Fare Schemes ....................................................................... 190
4. Inter-Operator Schemes ..................................................................... 190
APPENDIX TO SCHEDULE 2.5 ..................................................................... 191
List of Transport, Travel and Other Schemes ............................................... 191
3 Not used ................................................................................................. 193
4 Accessibility and Inclusivity ....................................................................... 194
1. Relationship with other obligations relating to persons with disabilities ...... 195
2. Physical Alterations and Accessibility of Stations .................................... 195
3. Dealing with Claims relating to Stations ................................................ 198
4. Specific additional obligations relating to persons with disabilities ............ 199
APPENDIX 1 TO SCHEDULE 4 ..................................................................... 201
Minor Works ............................................................................................ 201
APPENDIX 2 TO SCHEDULE 4 ..................................................................... 202
Accessible Transport Arrangements ............................................................ 202
5 Fares ...................................................................................................... 203
SCHEDULE 5.1 ......................................................................................... 204
Purpose, Structure and Construction ........................................................... 204
1. Purpose of Schedule 5 ........................................................................ 204
2. Structure of Schedule 5 ...................................................................... 205
3. Construction ...................................................................................... 205
SCHEDULE 5.2 ......................................................................................... 207
Franchisee's Obligation to Create Fares ....................................................... 207
1. Creation of Commuter Fares and Protected Fares ................................... 207
2. Restrictions on Creation of Fares .......................................................... 207
SCHEDULE 5.3 ......................................................................................... 208
Allocation of Fares to Fares Baskets ............................................................ 208
1. Allocation of Fares to Fares Baskets ...................................................... 208
2. Designation of Non Fares Basket Fares ................................................. 208
SCHEDULE 5.4 ......................................................................................... 210
Regulation of Fares Basket Values .............................................................. 210
1. Value of Fares Basket not to exceed Regulated Value ............................. 210
2. Value ................................................................................................ 210
3. Projected Revenue ............................................................................. 210
4. Regulated Value ................................................................................. 210
SCHEDULE 5.5 ......................................................................................... 212
Regulation of Individual Fares .................................................................... 212
1. Price or Child Price not to exceed Regulated Price or Regulated Child
Price ....................................................................................................... 212
2. Regulated Price .................................................................................. 212
3. Compulsory Inter available Flows ......................................................... 213
SCHEDULE 5.6 ......................................................................................... 214
Exceeding the Regulated Value, Regulated Price or Regulated Child Price ........ 214
1. Exceeding the Regulated Value ............................................................ 214
2. Exceeding the Regulated Price or Regulated Child Price ........................... 215
SCHEDULE 5.7 ......................................................................................... 216
Changes to Fares and Fares Regulation ....................................................... 216
1. Changes to Fares Baskets ................................................................... 216
2. Changes to the 2015 Nominal Ticket Sales ............................................ 217
3. Changes to the Reference Revenue, Gross Revenue, 2015 Nominal
Ticket Sales and/or 2015 Ticket Revenue .................................................... 217
4. Changes to Prices ............................................................................... 218
5. Changes to Fares Regulation ............................................................... 218
6. Changes to Compulsory Inter available Flows ........................................ 218
7. Change of Lead Operator/Major Flow Operator ....................................... 219
8. Changes to Fares Documents ............................................................... 219
SCHEDULE 5.8 ......................................................................................... 220
Fares Regulation Information and Monitoring ............................................... 220
1. Information ....................................................................................... 220
2. Monitoring ......................................................................................... 220
SCHEDULE 5.9 ......................................................................................... 221
Smart Ticketing ....................................................................................... 221
1. Smart Ticketing ................................................................................. 221
6 Franchise Specific Obligations and Committed Obligations ............................. 226
SCHEDULE 6.1 ......................................................................................... 227
Franchise Specific Obligations .................................................................... 227
1. Crossrail ........................................................................................... 227
2. New Stations ..................................................................................... 230
3. HS2 Spoil Train .................................................................................. 230
SCHEDULE 6.2 ......................................................................................... 231
Committed Obligations .............................................................................. 231
PART 1 - COMMITTED OBLIGATIONS .......................................................... 231
PART 2 - SPECIAL TERMS RELATED TO COMMITTED OBLIGATIONS ................ 232
1. Continuation of Availability .................................................................. 232
2. Expenditure Commitments .................................................................. 232
3. Liaison and Co-Operation .................................................................... 233
4. Nature of Commitment ....................................................................... 233
5. Review of Compliance ......................................................................... 234
6. Remedy for Late Completion or Non-Delivery of Committed
Obligations .............................................................................................. 234
7. Specimen Schemes ............................................................................ 234
8. Third Party Consents, Agreement and Conditions ................................... 234
9. Definition of "all reasonable endeavours" or "reasonable endeavours" ....... 235
SCHEDULE 6.3 ......................................................................................... 236
NOT USED ............................................................................................... 236
7 Performance Benchmarks .......................................................................... 237
SCHEDULE 7.1 ......................................................................................... 238
Performance Benchmarks .......................................................................... 238
1. Definitions, Formula Definitions and Location and amendment of
Benchmarks and Annual Benchmarks ......................................................... 238
2. Information Provisions relating to Cancellations Benchmarks and
Annual Cancellations Benchmarks .............................................................. 245
3. Cancellation Calculation: Value of A ...................................................... 246
4. Cancellation Calculations during the Initial Reporting Period .................... 246
5. Cancellation Calculations during the Breach Reporting Period ................... 246
6. Cancellation Calculations during the Subsequent Reporting Period ............ 246
7. Annual Performance Cancellations Calculations ...................................... 247
8. Allocation of Disputed Cancellations/Disputed Partial Cancellations ........... 247
9. Information provisions relating to TOC Minute Delay Benchmarks and
Annual TOC Minute Delay Benchmarks ........................................................ 248
10. TOC Minute Delay Calculations during the Initial Reporting Period ............ 249
11. TOC Minute Delay Calculations during the Breach Reporting Period ........... 249
12. TOC Minute Delay Calculations during the Subsequent Reporting
Period ..................................................................................................... 250
13. Annual Performance TOC Minute Delay Calculations ................................ 251
14. Allocation of Disputed Minutes Delay .................................................... 251
15. Short Formation Benchmarks and Annual Short Formation Benchmark ..... 252
16. Calculations ....................................................................................... 254
17. Notice of Performance Results ............................................................. 255
18. Consequences for Poor Performance ..................................................... 255
19. Performance Sum Payments ................................................................ 255
20. Determination of the Annual Benchmarks for Franchisee Years that are
shorter than thirteen (13) Reporting Periods ................................................ 271
21. Determination of the Actual CaSL Performance Level and the Actual
PPM Performance Level for Franchisee Years that are shorter than thirteen
(13) Reporting Periods .............................................................................. 274
22. Network Rail Claim ............................................................................. 275
APPENDIX 1 TO SCHEDULE 7.1 .................................................................. 276
Cancellations Benchmarks and Annual Cancellations Benchmarks ................... 276
PART 1 - CANCELLATIONS BENCHMARK TABLE ............................................ 276
PART 2 - ANNUAL CANCELLATIONS BENCHMARK TABLE ................................ 283
PART 3 - ANNUAL CANCELLATIONS PAYMENT TABLE .................................... 284
APPENDIX 2 TO SCHEDULE 7.1 .................................................................. 285
TOC Minute Delay Benchmarks and Annual TOC Minute Delay Benchmarks ..... 285
PART 1 - TOC MINUTE DELAY BENCHMARK TABLE ........................................ 285
PART 2 - ANNUAL TOC MINUTE DELAY BENCHMARK TABLE ........................... 292
PART 3 - ANNUAL TOC MINUTE DELAY PAYMENT TABLE ................................ 293
APPENDIX 3 TO SCHEDULE 7.1 .................................................................. 294
Short Formation Benchmark and Annual Short Formation Benchmark Table .... 294
PART 1 - SHORT FORMATION BENCHMARK TABLE ........................................ 294
PART 2 - ANNUAL SHORT FORMATION BENCHMARK TABLE ........................... 301
PART 3 - ANNUAL SHORT FORMATION PAYMENT TABLE ................................ 302
SCHEDULE 7.2 ......................................................................................... 303
National Rail Passenger Surveys, Customer Report and CCIF Scheme ............. 303
1. Conduct of National Rail Passenger Surveys .......................................... 303
2. Consultations ..................................................................................... 303
3. Customer and Stakeholder Engagement Strategy ................................... 304
4. Customer Report ................................................................................ 304
5. CCIF Scheme ..................................................................................... 304
6. Customer Service and Satisfaction Data ................................................ 307
SCHEDULE 7.3 ......................................................................................... 308
Customer Experience Performance ............................................................. 308
1. Definitions ......................................................................................... 308
2. Conduct of Customer Experience Surveys .............................................. 309
3. Performance against KPIs .................................................................... 310
4. Calculation of performance against Key Performance Indicators ............... 310
5. Review and Reporting of Performance ................................................... 311
6. Customer Experience Reimbursement ................................................... 313
7. Remedial Action ................................................................................. 313
8. Reserved Obligations .......................................................................... 314
9. Review of Customer Experience Benchmarks ......................................... 314
10. Changes to Customer Experience Survey .............................................. 315
11. Change to Customer Experience Survey Methodology ............................. 316
12. Policy Changes ................................................................................... 316
13. Calculation of Performance Scores ........................................................ 316
14. Calculation of Customer Experience Reimbursement ............................... 319
APPENDIX 1 TO SCHEDULE 7.3 .................................................................. 322
Customer Experience Performance ............................................................. 322
APPENDIX 2 TO SCHEDULE 7.3 .................................................................. 323
Market Sector Thresholds .......................................................................... 323
PART 1 : INTER CITY MARKET SEGMENT MINIMUM PERFORMANCE THRESHOLD323
PART 2 : GREAT EASTERN MARKET SEGMENT MINIMUM PERFORMANCE
THRESHOLD .................................................................................. 324
PART 3 : WEST ANGLIA MARKET SEGMENT MINIMUM PERFORMANCE THRESHOLD325
PART 4 : STANSTED EXPRESS MARKET SEGMENT MINIMUM PERFORMANCE
THRESHOLD .................................................................................. 326
PART 5 : REGIONAL MARKET SEGMENT MINIMUM PERFORMANCE THRESHOLD 327
APPENDIX 3 TO SCHEDULE 7.3 .................................................................. 328
Reserved Obligations ................................................................................ 328
8 Payments ................................................................................................ 329
SCHEDULE 8.1 ......................................................................................... 330
Franchise Payments .................................................................................. 330
1. Franchise Payments ............................................................................ 330
2. Payment of Franchise Payments ........................................................... 332
3. Interest ............................................................................................ 333
4. Disputes under Schedule 8 .................................................................. 333
5. Industrial Action ................................................................................. 333
APPENDIX 1 TO SCHEDULE 8.1 .................................................................. 334
Annual Franchise Payments ....................................................................... 334
APPENDIX 2 TO SCHEDULE 8.1 .................................................................. 335
Figures for Calculation of Annual Franchise Payments ................................... 335
SCHEDULE 8.2 ......................................................................................... 336
Profit Share Mechanism ............................................................................ 336
1. Profit Share ....................................................................................... 336
2. Relevant Profit Report ......................................................................... 345
3. Payment of Profit Share and Determination by the Secretary of State ....... 346
APPENDIX 1 TO SCHEDULE 8.2 .................................................................. 347
Profit Share Thresholds ............................................................................. 347
APPENDIX 2 TO SCHEDULE 8.2 .................................................................. 350
Components of AFA and DFR ..................................................................... 350
SCHEDULE 8.3 ......................................................................................... 352
Track Access Adjustments and Station Charge Adjustments........................... 352
1. Track Access Adjustments ................................................................... 352
2. Station Charge Adjustment .................................................................. 353
SCHEDULE 8.4 ......................................................................................... 356
GDP & CLE Adjustment Payments ............................................................... 356
Part 1 ..................................................................................................... 356
1. Purpose and Application of Schedule ..................................................... 356
Part 2 ..................................................................................................... 357
GDP Risk Adjustment Payment................................................................... 357
2. Definitions ......................................................................................... 357
3. GDP Adjustment Payment ................................................................... 358
4. GDP Adjustment Payments (GDPA) ...................................................... 359
5. GDP Reconciliation Payments (GDPR1 and GDPR2) .................................. 361
6. Final Adjustments / Reconciliations ....................................................... 362
Part 3 ..................................................................................................... 364
CLE Adjustment Payment .......................................................................... 364
7. Definitions ......................................................................................... 364
8. CLE Adjustment Payment .................................................................... 365
9. CLE Adjustment Payments (CLEA) ........................................................ 366
10. CLE Reconciliation Payment (CLER) ...................................................... 368
11. Final Adjustments / Reconciliations ....................................................... 369
APPENDIX 1 TO SCHEDULE 8.4 .................................................................. 370
DFTGDPRW................................................................................................ 370
APPENDIX 2 TO SCHEDULE 8.4 .................................................................. 371
Adjusted Target GDP Index ....................................................................... 371
APPENDIX 3 TO SCHEDULE 8.4 .................................................................. 373
DfTCLERW ................................................................................................. 373
APPENDIX 4 TO SCHEDULE 8.4 .................................................................. 374
Adjusted Target CLE Index ........................................................................ 374
9 Changes and Variations............................................................................. 376
SCHEDULE 9.1 ......................................................................................... 377
Financial and Other Consequences of Change .............................................. 377
1. Purpose and Application of Schedule ..................................................... 377
2. Timescales ........................................................................................ 378
3. How any adjustments to Franchise Payments will be established .............. 378
4. How Model Changes and/or Revised Inputs will be established ................. 379
5. Changes to Benchmarks and/or Annual Benchmarks ............................... 379
6. Run of the Financial Model following agreement or determination of
the Revised Inputs and Model Changes ....................................................... 380
7. Certification or Audit of the New Results ............................................... 380
8. Costs of Audit .................................................................................... 381
9. Restatement of Annual Franchise Payment Components and/or
Benchmarks and/or Annual Benchmarks and/or Profit Share Components ....... 382
10. Estimated Revisions ............................................................................ 384
11. Information ....................................................................................... 386
APPENDIX 1 TO SCHEDULE 9.1 .................................................................. 387
Definition of Threshold Amount .................................................................. 387
APPENDIX 2 TO SCHEDULE 9.1 .................................................................. 388
Agreement or Determination of Revised Inputs ............................................ 388
SCHEDULE 9.2 ......................................................................................... 393
Identity of the Financial Model ................................................................... 393
1. Franchisee's Obligations ...................................................................... 393
2. Secretary of State's Obligations ........................................................... 393
3. Errors in Escrow Documents ................................................................ 395
SCHEDULE 9.3 ......................................................................................... 396
Variations to the Franchise Agreement and Incentivising Beneficial
Changes .................................................................................................. 396
1. Variations to the Franchise Agreement and Incentivising Beneficial
Changes .................................................................................................. 396
2. Protected Proposals ............................................................................ 397
3. Capital Expenditure ............................................................................ 398
SCHEDULE 9.4 ......................................................................................... 400
Secretary of State Risk Assumptions ........................................................... 400
1. ERTMS .............................................................................................. 400
2. Crossrail ........................................................................................... 400
10 Remedies, Events of Default and Termination Events .................................... 401
SCHEDULE 10.1 ....................................................................................... 402
Procedure for remedying a Contravention of the Franchise Agreement ............ 402
1. Contraventions of the Franchise Agreement ........................................... 402
2. Remedies for Contraventions of the Franchise Agreement ....................... 402
3. Remedial Plan Notices ......................................................................... 402
4. Remedial Plans .................................................................................. 402
5. Remedial Agreements ......................................................................... 403
6. Effect of Force Majeure Event on a Remedial Agreement ......................... 403
7. Monitoring by the Secretary of State .................................................... 403
SCHEDULE 10.2 ....................................................................................... 405
Events of Default and Termination Events ................................................... 405
1. Definition of Events of Default ............................................................. 405
2. Definition of Termination Events .......................................................... 409
3. Provisions Relating to Events of Default ................................................ 409
4. Notification of Event of Default............................................................. 409
5. Termination Notices ............................................................................ 410