Legal Aspects
A monopoly is the exclusive right or power of someone to provide specific goods or services within a given market.

This broad definition includes how the term monopoly is commonly used where it describes a situation where one producer or supplier, because of the large size of the market it controls, can suppress effective business competition in that market and thus enhance the price of its products or services.

However the term monopoly also means — and this is how it should be understood here — the exclusive right granted by the state to one person or persons to sell a product or provide a service within a given area. This turns something that was once a common right into a privilege. Where the exclusive right is granted by the state to a public body it’s a public monopoly.

A public monopoly, in the context of urban bus transport services, entails the right of a municipal government or of a public transport authority to provide, to the exclusion of all others, urban bus transportation services within their areas of jurisdiction.

Two kinds of public monopolies
Municipal government
A municipal government is a city, town or other geographically defined urban area created by the will of the state and having autonomous authority to administer its own affairs. Municipalities are not independent entities. It and its governments are usually created by a law of the state or an equivalent legal instrument (e.g., a municipal charter) and derive their powers from it. This includes the right to regulate urban bus transport in its territory or to provide urban bus transport services itself, either in conjunction with others or on an exclusive basis.

While many municipal services can be sub-contracted to a third party, if the municipal government is granted a monopoly over the provision of urban bus transport services it will most likely operate those services:

• directly through a department of the municipality; or
• indirectly through a bus company specially set up by the municipality for that purpose.

Public transport authority
For large urban agglomerations the state may sometimes retain jurisdiction over urban bus transport services and create by law a public transport authority that it then controls to the exclusion of the municipalities over whose territory the public body operates.

Often this statutory public transport authority will be responsible for the provision of urban transport services, not only by bus, but also by metro, light rail, ferry or any other available means of urban public transport. When many modes of public transport are involved, the public transport authority can provide the urban bus transport services either directly or through a functional or legal subdivision of it (e.g., a business unit or a separate bus company).