The European Commission on Wednesday opened an in-depth investigation to assess whether certain French measures to support the Fret SNCF SAS subsidiary of French rail operator SNCF SA are in line with European Union (EU) state aid rules.
Brussels notes that Fret SNCF has been consistently loss-making, except in 2021, and in the period from 2007 to 2019, its losses were continuously covered by its parent company SNCF through intra-group cash advances, which constitute state resources due to state participation and control.
At this stage, on the basis of its preliminary examination, the Commission has concerns that certain measures in favor of Fret SNCF taken during this period, are not in line with EU state aid rules.
In particular, it will investigate the cash advances made by SNCF in favor of its subsidiary from at least the beginning of 2007 until the transformation of Fret SNCF into a commercial company in 2020, estimated at between €4 billion and €4.3 billion; the cancellation of the financial debt, amounting to €5.3 billion; and the capital injection of €170 million made at the time of the conversion of Fret SNCF into a commercial company.
The Commission is now conducting a more in-depth investigation to determine whether its initial concerns are confirmed, while the opening of an in-depth investigation gives France and other interested third parties, including the beneficiary, the opportunity to submit their observations.
Source: (EUROPA PRESS)
