The discussion about the EU’s simplified state aid rules for green transport like rail is again on the table. UIRR assessed that the new state aid rules proposal should function as the platform for deeper reforms starting with correcting the regulatory imbalance between transport modes.

ERFA was the first to react after Brussels communicated its plans to provide state aid for rail, inland waterway and multimodal transport in early July. The association stressed that simpler state aid rules are positive but with the danger of undermining fair competition between rail freight companies.

The International Union for Road-Rail Combined Transport (UIRR) got back to the discussion, praising the decision’s intentions but also underlying that state aid is not the only thing that rail and combined transport need. In fact, simpler state aid rules should just be the starting point for the Commission’s knife to cut deeper into imbalances and unfair competition, explained UIRR, highlighting that money is not everything in this case.

State aid doesn’t solve everything

“The spirit of the proposal should certainly be praised,” clarified UIRR. Yet, if the Commission wants to boost green transport and lay the ground for a sustainable future, simpler state aid will not do the job alone. The combined transport association elaborated that the real problem is the price signals for intermodal transportation. Where price signals, see the starting prices for rail, intermodal and combined transport services.

Consequently, UIRR believes that state aid should function as a balancing tool to correct the pricing imbalances between different transport modes until they are resolved for good. On top of that, it should be an incentive targeting shippers to support their modal shift.

On top of that, the association said that state aid should not only be translated into financial benefits. Policymakers could take other, smaller but impactful steps in this regard, like “the legal equivalence between a combined transport operation and its corresponding road haulage, or the additional weight allowance of trucks performing combined transport road legs.”

Finally, UIRR underscored that state aid decisions should align with longer-term objectives and thus not have a temporary character. As a result, reducing state aid should be accompanied by a regulatory leap to establish a more competitive and fair environment for intermodal transport. And intermodal transportation, concluded UIRR, should be distinguished from multimodal transport to avoid confusion and support the wrong transport modes.

Also read:

• “Simpler state aid is great, but mind the internal competition”
• Commission wants to make state aid for rail easier, what does this mean?