Stena Line Objects to State Aid for Undersea Fehmarn Tunnel

Ferry operator Stena Line believes that the European Commission’s tacit approval of public financing of the Fehmarn Belt fixed rail-road link between Denmark and Germany is discriminatory and not in line with EU State aid rules.

The financing model notified by Denmark involves public support for the planning, construction and operation of the rail-road fixed link and the Danish rail and road connections.The costs of the entire project are estimated to be DKK 64.4 billion (EUR 8.7 billion), part of which is funded by the European Union through the Connecting Europe Facility.

“Consequently, Stena Line will await the publication of the full decision and consider to appeal the Decision,” the company said in a press statement commenting on the approval.

“The existence of 9 ferry routes between 14 different ports is based on established interconnectivity needs and fair competition. The market is more than adequately served by these ferry routes. All the State’s involvement achieves is an extra 8 billion € cost for the taxpayers. A fixed undersea tunnel link between Rødby and Puttgarden supported by unjustified State aid creates an un-level playing field and distorts competition with the well-functioning ferry services which have been provided for many years. It also goes against the principle of shifting transport away from road,” says Carl-Johan Hagman, CEO Stena Line.

Stena Line noted that the Commission’s press release did not confirm whether the payment of State aid has taken place, but simply states that if State aid is involved, the aid can be approved.

“In doing so, the Commission seems to be taking an approach which is entirely out of touch with well-established case-law of the Union Courts and the practice of the European Commission, such as the Øresund Commission Decision, which confirms that public financing for commercially exploited infrastructure is subject to the State aid rules,” Stena Line added.

In addition to the above, the Commission does not seem to have prescribed a timeframe for the State aid.

“The idea of open-ended State aid without time limits, for a project of this magnitude, simply makes no sense. This provides the operators of the tunnel with the ability to use the State aid to dump their State-subsidised prices, thereby squeezing out competitors such as ferry operators,” Hagman said.

The ferry operator said it would wait the publication of the full decision and will consider to challenge the decision before the Union courts in Luxembourg.

“No doubt other affected operators will be doing likewise,” the company concluded.