The CEO of the National Transport Authority is to refer to the competition authority the tendering for bus routes by a state subsidised company in Kerry.
The Kerry Flyer won five out of 12 contracts that were put out to tender this year by Bus Eireann.
Anne Graham told a meeting of the Joint Committee for Transport and Communications that the National Transport Authority has no role to play in the provision of school transport services funded by the Department of Education and Science.
She said Bus Éireann procures school transport services under an administrative agreement with that department and therefore the Authority is not in a position to comment on any school transport contract as it is not a party in their procurement
The Castleisland based community bus service is part funded by Pobal and private operators believe it has an unfair advantage.
However as part of the funding it receives, the Kerry Flyer must generate additional independent income.
Pobal says tendering for contracts is allowed in this regard.
Three Kerry TDs, Tom Fleming, Brendan Griffin and Martin Ferris attended a meeting of the Joint Committee for Transport and Communications in the Dáil.
Also present was members of the National Transport Association and a number of Kerry bus contractors.
Deputy Tom Fleming who is a member of the Transport and Communications committee along with Deputy Brendan Griffin suggested Transport Minister Paschal Donohoe be contacted about the matter.