WORKING WITH NETWORK RAIL (NWR)

  1. INTRODUCTION
    1. NWR is a major force in the UK economy; it owns and operates the country’s rail network including stations and freight yards and is a major landowner in its own right.
    2. NWR is a publicly owned utility and is regulated by the Office of Rail and Road ( ORR), essentially via its licence to operate the rail system. NWR is the distant descendant of the Victorian rail companies that built the largest part of our current rail system.
    3. It is a complex organisation positioned at the intersection of a number of important policy and market trends. There are many opportunities in its extensive landholdings but engaging with NWR can be a challenge and this paper works through some of issues to be considered.
  2. STRUCTURE OF INDUSTRY
    1. It is worth briefly describing the structure of the rail industry today. Inevitably it is under almost constant review.
    2. As mentioned NwR owns the track and stations . The major stations ( eg London termini ) are operated by NwR.
    3. Passenger services are provided by Train Operating Companies ( TOCS ) who in principle hold franchises for the delivery of services on specific routes and hold leases from NwR of the stations on the franchised route.
    4. Rolling stock is owned by rolling stock owning companies (ROSCOs) who lease the assets to the TOCs.
  3. procurement and value for money
    1. As a public body ( in shorthand ) NwR is obliged to comply with general public procurement and value for money policies and rules which make it very difficult for NwR to engage with the private sector otherwise than via transparent public competition.
    2. This is a longstanding challenge for NwR who find it difficult to respond to unsolicited proposals except in narrowly defined circumstances. It is possible ( but not likely ) that this will become easier post Brexit.
  4. Station works
    1. It is common for rail related development or works proposals to include changes , upgrades or enhancements to an existing station .In principle all changes like this would need to go through the Station Change procedure .
    2. This is a regulated procedure and involves consultation and dialogue with all affected stakeholders in the station. Depending on the scale and issues involved this can be a complex and time consuming aspect . This can have material cost and programme impacts.
  5. network licence conditions
    1. As is to be expected these Conditions include at Condition 17 ( LC 17 ), procedures for ORR to consult on and in substance control proposed land disposals by NwR. This will include in most cases proposed disposals etc of station carpark land as well other assets.
    2. The detail of these procedures lies outside the scope of this brief note but the interaction of this aspect eg with the Station Change procedures in relevant circumstances can need close and careful management to manage programme and cost impacts.
  6. land and air rights  
    1. Sometimes transactions can involve the purchase of freehold land from NwR. It is important to bear in mind that this may be the first occasion on which the parcel has been transferred since the original railway to which it is connected was built in the 19th C. There can on occasion be a need for careful historical research to ensure there are no residual issues from the original Acts of Parliament etc which will have authorised the construction works.
    2. On other occasions transactions may involve the grant of rights over or under NwR assets. Whilst the detail will clearly vary from project to project it will be important to bear in mind that these require careful and very precise engineering and in particular engineering drawings.
  7. commercial issues
    1. As a prudent and experienced owner of major assets NwR will always address very carefully the issue of counterparty risk and will generally expect guarantees and similar security to be available ( commensurately with the project ) to manage risks associated with performance and delivery by its counterparty.