New franchises for two franchised bus companies

The Government plans to engage Citybus Limited (Franchise for Hong Kong Island and cross-harbour bus network) (Citybus (Franchise 1)) and New Lantao Bus Company (1973) Limited (NLB) in the fourth quarter of this year for discussion on the granting of new 10-year franchises, a government spokesman said today (June 24). The new franchises will take effect immediately upon the expiry of the existing ones to ensure the continuous provision of proper and efficient public bus services.

The spokesman said that the current franchises of Citybus (Franchise 1) and NLB would expire on June 1, 2016, and March 1, 2017, respectively. The two franchised bus companies have indicated an interest to apply for new 10-year franchises. According to the Public Bus Services Ordinance (Cap. 230 of Hong Kong Laws), the Executive Council may grant to a company a franchise conferring the right to operate a public bus service for a period not exceeding 10 years. The Ordinance also requires the grantee of a bus franchise to maintain a proper and efficient public bus service to the satisfaction of the Commissioner for Transport at all times during the franchise period. As per the Ordinance, the Government has in the past granted a new 10-year franchise near the expiry of an existing one a number of times, as long as the pre-existing grantee was able to prove its ability to provide a proper and efficient public bus service and was willing to further invest in the franchised bus operation.

Citybus (Franchise 1) mainly operates the Hong Kong Island and cross-harbour bus network. NLB mainly serves Lantau Island and Shenzhen Bay Port.

"Citybus (Franchise 1) and NLB have been providing proper and efficient bus services, and are willing to invest for further improvements," the spokesman said.

"The operating environment of the bus industry in the foreseeable future is expected to remain rather difficult owing to rising operating costs as well as keen competition from other public transport modes including railway.

"To ensure a continuous provision of essential public bus services, the Government plans to engage the two franchised bus companies for discussions on new 10-year franchises. The Government will strive for the most favourable franchise terms for the public as far as possible in a pragmatic manner. Yet, we do not underestimate the difficulty of the discussions and will have to take into account the actual operating environment in the process."

The Panel on Transport of the Legislative Council (LegCo) and the Transport Advisory Committee discussed the requirements of the new franchises yesterday (June 23) and today respectively. Information on the two franchises can be downloaded from the websites of the Transport and Housing Bureau (www.thb.gov.hk) and Transport Department (www.td.gov.hk) starting tomorrow (June 25). From tomorrow to September 16, 2014, members of the public may put forth their views on the requirements of the two new franchises concerned by post (addressed to Bus and Railway Branch, Transport Department, 40/F, Immigration Tower, 7 Gloucester Road, Wanchai, Hong Kong), fax (2802 2679) or email (bus-franchise@td.gov.hk). The Government will also invite views from members of the Traffic and Transport Committees of the District Councils.

Meanwhile, the current franchise of The Kowloon Motor Bus Company (1933) Limited will expire on July 1, 2017. As there is still some time until that date, and given the size and number of routes covered by the bus network concerned, the franchise for this network will be separately handled. The Government expects to report to LegCo on this in mid-2015, and will invite public views on the requirements for that new franchise.

Ends/Tuesday, June 24, 2014
Issued at HKT 17:12

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