Flixbus operator is suing against state aid for Deutsche Bahn

Flixtrain is reflected in the ICE of Deutsche Bahn

Flixtrain is afraid of being ousted by the state-owned Deutsche Bahn.

(Photo: imago / Chris Emil Janßen)

Düsseldorf. The Munich start-up Flixmobility, operator of Flixbus and Flixtrain, is taking legal action against the federal capital aid for Deutsche Bahn. On Wednesday, Flixmobility submitted a formal complaint to the EU Competition Commission, which is also directed against the rapidly increasing debt of the railway. The conflict between the state-owned company and its competitors has reached a new high point.

Like other railway competitors, Flixmobility fears that the billions in capital aid will distort competition and possibly even force companies out of the market. Your demand: All rail operators should benefit from government aid measures in the corona crisis. And: tax money for Deutsche Bahn only under certain conditions.

Flixmobility co-founder André Schwämmlein told the Handelsblatt that he was “not against helping Deutsche Bahn”. “But we want this aid to benefit the entire sector, that is, it does not disadvantage competition, and that it is therefore subject to conditions that make it possible for us to operate under acceptable market conditions in Germany.”

Industry associations such as Mofair and Allrail, which represent non-state railway companies in Germany and Europe, support the complaint in Brussels because “both an equity increase for Deutsche Bahn AG and a further increase in its debt limit would be state aid that would distort competition. In both cases, the German state would assume unilateral risk liability. ”

Criticism also comes from the opposition: “The financial and personal problems of the DB Group, which for the most part have nothing to do with the corona pandemic, can no longer be poured into billions of euros from the federal government,” says FDP transport politician Christian Jung. The FDP parliamentary group demands the complete waiver of a capital increase.

So far no application for aid in Brussels

In May, the federal government and Deutsche Bahn agreed on an aid package to compensate for the corona damage at the state-owned company. This is heading for a record loss of 5.6 billion euros this year. The federal government wanted to inject EUR 5.5 billion in fresh capital. The federal ministers later reduced the amount to five billion euros. To date, no state aid has been registered in Brussels.

The dispute is now exacerbated by a bizarre dispute between the Federal Ministry of Transport (BMVI) and the rail board. In the opinion of the responsible State Secretary Enak Ferlemann (CDU), the railway board of directors must apply for the so-called notification in Brussels, not the ministry.

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Ferlemann told the Bundestag Transport Committee on Wednesday that no application for a notification procedure had yet been made. This is the task of the board of directors of DB AG, not the federal government, said Ferlemann after reports from the meeting.

This statement surprised the members of the Transport Committee. Because, according to EU state aid rules, state aid must always be reported by the state in Brussels. Ferlemann added that the Bahn Management Board did not agree with the results of the discussions in the so-called preliminary proceedings with the Commission and therefore wanted to negotiate further. For the Ministry of Transport, the requirements of the EU Commission are quite acceptable. He did not say what specifications these are.

The Federal Ministry of Transport and Digital Infrastructure’s Secretary of State is now making the rail management, under the leadership of Richard Lutz, responsible for ensuring that even seven months after the agreement between the federal government and rail, no application has been made – and no money can flow. The railway did not want to comment on this. FPD politician Jung says: “It is high time that the federal government ended the unworthy aid poker game of DB AG and made it clear to the DB board that there would only be corona aid under certain conditions.”

Monopoly Commission advises conditions for the state company

The Monopolies Commission, which advises the government on competition issues, also recommends that capital aid for the railways should only be granted under certain conditions. The committee proposes lowering the prices for the use of the railway lines during the pandemic for all railways, creating more transparency between the infrastructure companies (network, energy, stations) and the rail holding company, and providing real-time data for all users in order to gain access to facilitate new railway companies.

If the payment of the billions is delayed further, the debt of the Deutsche Bahn increases. The state company needs billions to finance ongoing operations. The federal budget committee therefore raised the debt ceiling on Wednesday to 32 billion euros for 2020 and 35 billion euros for 2021 at the request of the government coalition of the CDU and SPD.

That would then be eleven billion euros more than at the end of 2019. However, with the stipulation: “After the capital increase by the federal government to compensate for corona-related damage in the DB Group, this target value must be reduced accordingly,” says the resolution.

Left calls for nationalization

Flixmobility sees the massive increase in the debt ceiling as a secret route for the state company to bypass Brussels. No private company would be able to take on such debts on the capital market. The left in the Bundestag is already calling for the 1994 privatized railway to be re-nationalized. “The transformation of the railway into a private company was a huge mistake that must be reversed,” says Victor Perli, member of the budget committee. “We need a citizens’ railway, not a heavily indebted stock corporation.”

To approve the state aid for the Bahn AG, an EU Commission spokeswoman had recently only replied to the Handelsblatt’s request: “The Commission is in contact with the German authorities on this matter, and we cannot anticipate the outcome of these contacts.” “In general it is important that the rail sector is supported where it is needed while ensuring that competition within the rail sector is maintained, ”she said

More: Flixtrain is examining a lawsuit against billions in railways before the ECJ

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