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EC opens in-depth investigation into public financing of Oresund fixed rail-road link

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Staff Writer | February 28, 2019
The European Commission has opened an in-depth investigation to assess whether Danish and Swedish public support for the Øresund fixed rail-road link is in line with EU State aid rules.
Øresund
Europe   The Commission has opened an in-depth investigation under EU State aid rules
This follows the EU General Court's annulment of a previous Commission decision approving the support.

The Commission has opened an in-depth investigation under EU State aid rules into the aid measures granted by Denmark and Sweden to the consortium owning and operating the Øresund fixed rail-road link.

The Øresund fixed rail-road linkconsists in a toll-funded 16 kilometres long bridge, an artificial island and a tunnel for road and railway traffic from the Swedish coast to the Danish island of Amager.

It is the longest combined road and rail bridge in Europe and connects Copenhagen to Malmö. The link was built between 1995 and 2000 and has been in operation since June 2000.

The Øresundsbro Konsortiet, a consortium formed by the Danish and Swedish states, owns and operates the Øresund fixed rail-road link on the basis of an intergovernmental agreement.

Under this agreement, Denmark and Sweden guarantee the loans that the consortium secured in order to finance the link.

Denmark also foresaw a special tax treatment for the consortium as regards depreciation of assets and fiscal loss carry forward.

In 2013, Scandlines Øresund I/S (“Scandlines”) filed a complaint with the Commission alleging that the State guarantees granted by Denmark and Sweden to the Øresundsbro consortium, as well as certain tax advantages granted by Denmark, were incompatible with EU State aid rules.

In particular, the Commission found that the public guarantees on the consortium's loans and the tax measures implemented by Denmark constituted State aid, as they gave a selective advantage to the consortium, which operates the link on a commercial basis.

However, the Commission found that the measures were necessary and proportionate for this project of common European interest to be completed.

Therefore, the Commission concluded that the measures were compatible with EU State aid rules.

the General Court partially annulled the Commission's decision on procedural grounds.

While the General Court did not rule directly on the compatibility of the measures with EU State aid rules, it found that the Commission should have opened a formal investigation to assess the case in-depth before adopting its State aid decision.

To comply with the General Court's September 2018 judgment, the Commission has today opened an in-depth investigation under EU State aid rules into the guarantees on the consortium's loans by Denmark and Sweden and the tax support measures implemented by Denmark.


 

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