Public service obligation

Obligation imposed on an organisation to provide a service in the EU In the context of European Union law, a public service obligation or PSO is an obligation imposed on an organisation by legislation or contract to provide a service of general interest within EU territories. PSOs may operate in any field of public service, but postal services, social services, energy, transport and banking are specific sectors where the concept is relevant. Transport law Two DHC Dash-8-100 aircraft of Widerøe of Norway at Trondheim Airport, Værnes. Widerøe makes a large portion of its revenue from PSO routes like these in Northern and Western Norway. In EU transport law, a PSO is an arrangement by which a governing body or other authority offers subsidies in an auction, whereby the winning company will be obliged to operate a specified service of public transport for a specified period of time in return for the subsidy. This usually leads to the winning bidder having a monopoly on the route, as competing services would not be viable without subsidies. PSOs are aimed at routes which are unprofitable in a free market, but where there is a socially desirable advantage to transport being available.