COVID–19 - Creating a Fair and Balanced Temporary State Aid Framework for Rail Freight

Rail freight will face significant challenges to continued operations over the coming months, particularly in light of a significant slowdown in industrial output due to national measures taken to control the outbreak of COVID-19. These short-term measures could cause longer term damage to the sector, namely the disappearance of operators and capacity, if measures are not taken to support the industry. ERFA and UIP therefore call for State support measures to be granted to Infrastructure Managers coupled with a short-term waiving of Track Access Charges and Energy Charges for rail freight undertakings.

The outbreak of COVID-19, and national responses to stem to spread of the virus, have created significant challenges to the short-to-medium term viability of rail freight operations. Industrial output is limited and this is leading to a reduced demand for freight movement, including rail freight. These national responses are merited and supported, but it must still be recognised that measures are warranted to support the industry.

Given the exemptional circumstances, ERFA and UIP believe it is appropriate to use Article 107(2)(b) and Article 107(3)b of the TFEU to allow Member States to assist the sector over the coming months. Any mechanism must be horizontal, sectoral and compliant with existing competition rules. The objective of any aid must solely be to assist all operators on a short-term basis and solely address difficulties directly or indirectly related to the slowdown of economic input and reduction of traffic.

ERFA and UIP strongly believe that short-term support is essential in order to ensure that rail freight undertakings are in a healthy condition once industrial output resume. Without government actions there is a risk that operators will cease to exist or have to significantly reduce their capacity which would have a longer lasting impact on Europe’s modal shift objectives.

We therefore believe that state support is warranted and necessary, but must be done in a way that benefits the rail freight industry equally and only addresses short-term issues related to COVID-19.