Those guidelines are part of the Community actions aiming to the dynamization of the railway sector, which have included legilative developments for liberalization of the sector and interoperability of the rail european network. As a third pilar,  the Commission considers this support to be justified in certain circumstances in view of the substantial adaptation costs necessary in that industry.

The Official Journal of the European Union published in July 22nd, the Communication from the Commission establishing the Community guidelines on State aid for railway undertaking, aiming to clarify the situation and give legal certainty to the grant of these kind of support in the railway sector.

The White Paper “European transport policy for 2010: time to decide” and its mid-term review underline to what extent a dynamic railway industry is necessary for establishing an efficient, clean and safe goods and passenger transport system that will contribute to the creation of a single European market enjoying lasting prosperity. 

The Community is conducting a three-pronged policy to revitalise the rail industry by:

• Gradually introducing conditions fostering competition on the rail transport services markets
• Encouraging standardisation and technical harmonisation on the European rail networks, aiming at full interoperability at the European level
• Granting financial support at Community level (in the TEN-T programme and the Structural Funds framework)

The objective of these guidelines is to provide guidance on the compatibility with the Treaty of State aid to railway undertakings. In addition, Chapter 3 also applies to urban, suburban and regional passenger transport undertakings. The guidelines are based in particular on the principles established by the Community legislator in the three successive railway packages. Their aim is to improve the transparency of public financing and legal certainty with regard to the Treaty rules in the context of the opening-up of the markets. These guidelines do not concern public financing intended for infrastructure managers.

The guidelines include the Objective, Limitations, Compatibility in the following areas:

• Public financing of railway undertakings by means of railway infrastructure funding
• Aid for the purchase and renewal of rolling stock
• Debt cancellation
• Aid for restructuring railway undertakings — restructuring a ‘freight’ division
• Aid for coordination of transport
• State guarantees for railway undertakings

The aid ceilings stipulated in these guidelines are applicable irrespective of whether the aid in questionis financed wholly or in part from State resources or from Community resources. Aid authorised under these guidelines may not be combined with other forms of State aid within the meaning of Article 87(1) of the Treaty or with other forms of Community financing if such combination produces a level of aid higher than that laid down in these guidelines. In the case of aid serving different purposes and involving the same eligible costs, the most favourable aid ceiling will apply.

The Commission will apply these guidelines from the date of their publication in the Official Journal of the European Union.