Gleiss Lutz has successfully represented DB AG in a formal state aid investigation before the European Commission. The Brussels authority has approved a measure worth EUR 1.9 billion to support the transformation of DB Cargo, the DB Group’s rail freight company. The approval was one of the outgoing Commission’s last official acts.
The proceedings were prompted by a complaint from a competitor. The formal investigation opened by the Commission in January 2022 concerned four measures. In its decision, the Commission followed the arguments of Germany, DB and Gleiss Lutz on almost all points. In particular, it came to the conclusion that none of the four measures contained notifiable ‘aid’ for the periods covered by the opening decision. The measures in question are either not attributable to the state or are in line with market conditions. The Commission has approved the funds made available by DB AG through loss transfer for the transformation of DB Cargo.
With the approval decision, the Commission is sending an important signal for the rail freight transport sector in Germany and Europe. The decision is also of fundamental importance for state-owned companies beyond rail freight transport. It confirms that intra-group measures only fall under the notion of aid by exception. In particular, it generally recognizes profit and loss transfer agreements as a market-compatible instrument for public groups of companies.
The transaction was handled in-house by Dr. Udo Woll and Nikolas Winter.
The following Gleiss Lutz team represented Deutsche Bahn in the proceedings: Dr. Ulrich Soltész (partner) and Dr. Harald Weiß (counsel, both Antitrust/Subsidies, both Brussels).
For more information on the formal investigation opened by the European Commission in January 2022, see https://ec.europa.eu/commission/presscorner/detail/en/ip_22_681
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