Germany accused of giving unfair state aid to Deutsche Bahn

Germany accused of giving unfair state aid to Deutsche Bahn


Germany has been accused of providing unfair state aid to Europe’s largest railway company Deutsche Bahn in a complaint to the EU Commission.

Transport provider FlixMobility has filed the complaint, saying Berlin has delayed a request to Brussels to allow a €5bn capital increase to Deutsche Bahn because of fears it will be rejected for breaking state aid rules.

At the same time, Berlin is repeatedly lifting Deutsche Bahn’s debt ceiling, enabling it to raise more money in bonds in the markets that investors consider state-backed, according to the Munich-based transport provider.

Germany’s Bundestag on Wednesday agreed to raise Deutsche Bahn’s debt ceiling once more to €32bn and plans a further increase to €35bn next year as it tries to help the company deal with its biggest ever losses. 

FlixMobility, which partners with private bus and train operators across Europe and the US, says the lifting of the debt ceiling gives Deutsche Bahn an unfair competitive advantage.

The company thinks the commission would be likely to impose measures to ensure fair competition, as countries that hand out more than €250m of aid must make sure that it is not distorting the market.

The commission must wait for Berlin to present its package before it can assess its next steps, according to people familiar with the matter. One person said that if FlixMobility is right about its complaint, the European Commission could act before the package is presented.

“We do not oppose state aid for Deutsche Bahn in principle, but the competitive balance in the market needs to be preserved to the benefit of the entire sector,” said André Schwämmlein, founder and chief executive of FlixMobility. 

“Only with competition and the momentum it creates can we achieve the sustainability goals in Germany and Europe together.”

Deutsche Bahn said: “The accusations are unfounded and simply not accurate, partly because the complainant is comparing apples and oranges. In view of the factual situation, we look forward to the upcoming discussions with composure.”

The German transport department did not respond to request for comment at the time of publication.

The country’s commission on monopolies also raised concerns about the debt, requesting several measures to ensure fair competition.

This included lowering track fees for private companies as well as improving financial transparency and data sharing.

Deutsche Bahn has already come under scrutiny this year after travel booking sites said it was refusing to share real-time data.

They argue this is anti-competitive and a danger to passengers seeking information on crowd sizes amid worries about the spread of the coronavirus.



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