Belgium (Brussels Morning Newspaper) The European Commission has approved two government schemes together worth EUR 4.1 billion to compensate companies affected by additional costs in two EU member states, France and Germany.
The first scheme, worth €3 billion, is intended to compensate companies operating in five French outermost regions for the additional costs incurred until 2027. The aid takes the form of a reduced rate on the docks due and a total exemption for companies with a turnover below €500,000. This is the second French government aid scheme approved this month, as an EUR 1.4-billion scheme to compensate Air France received approval a week ago.
The second scheme is worth €1.1 billion and will compensate rail transport operators using electric traction in Germany for the increased electricity costs due to the spike in electricity prices in the context of Russia’s war against Ukraine. The aid will take the form of monthly reductions in the freight and passenger rail transport operators’ electricity bills, and the scheme will cover electricity consumed between 1 January 2023 and 31 December 2023.
Considering the French scheme under the Regional aid Guidelines, the Commission found that the scheme is necessary and appropriate, proportionate, and will not have undue negative effects on competition and trade in the EU.
Compensation plans
The German scheme was assessed under the 2008 Guidelines on State aid for railway undertakings because it aims to support and preserve the modal shift from road to rail transport using electric traction in a situation of exceptionally high electricity cost. The Commission found that the scheme is beneficial for the environment and mobility, necessary and appropriate, proportionate, and will not have undue negative effects on competition and trade in the EU.
The French program will help companies operating in Guadeloupe, French Guiana, Martinique, Mayotte, and La Réunion to remain competitive and contribute to their regional development. These outermost regions face additional costs due to their distance from mainland Europe, which can discourage companies from operating there.
The scheme will run until 2027 and will compensate companies through reduced dock dues and total exemptions for some companies. However, companies active in certain sectors, such as lignite, coal extraction, and financial services, cannot benefit from the scheme.
The German scheme will help rail transport operators using electric traction to cover part of the additional electricity cost experienced due to the exceptional increases in electricity prices in the context of Russia’s war against Ukraine. The aid remains below the maximum thresholds set out in the Railway Guidelines and is limited to reducing the competitive disadvantages faced by rail transport using electric traction compared to road transport.
