Commission Regulation (EU) 2026/562 of 16 March 2026 declaring certain categories of aid in the rail, inland waterways and multimodal transport sector compatible with the internal market in application of Articles 93, 107 and 108 of the Treaty on the Functioning of the European Union

THE EUROPEAN COMMISSION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 108(4) thereof,

Having regard to Council Regulation (EU) 2022/2586 of 19 December 2022 on the application of Articles 93, 107 and 108 of the Treaty on the Functioning of the European Union to certain categories of State aid in the rail, inland waterway and multimodal transport sector (1), and in particular Article 1 thereof,

Having published a draft of this Regulation in accordance with Article 4 of Regulation (EU) 2022/2586,

After consulting the Advisory Committee on State aid,

Whereas:

(1) State funding meeting the criteria of Article 107(1) of the Treaty on the Functioning of the European Union (‘the Treaty’) constitutes State aid and requires notification to the Commission under Article 108(3) of the Treaty. However, in accordance with Article 109 of the Treaty, the Council may determine categories of aid that are exempted from that notification requirement. In accordance with Article 108(4) of the Treaty, the Commission may adopt regulations relating to those categories of State aid.

(2) Regulation (EU) 2022/2586 empowers the Commission to declare that aid for the coordination of transport as referred to in Article 93 of the Treaty may, under certain conditions, be exempted from the notification requirement.

(3) Aid to land transport is deemed compatible with the Treaty if it meets the needs of transport coordination or if it represents ‘reimbursement for the discharge of certain obligations inherent in the concept of a public service’ in accordance with Article 93 of the Treaty.

(4) To achieve the Union’s climate neutrality goal set out in Regulation (EU) 2021/1119 of the European Parliament and of the Council (2), a fundamental green and digital transformation of transport in the Union is needed. As part of the Commission’s 2020 sustainable and smart mobility strategy (3), the Union called on Member States to take measures making all transport modes more sustainable and to promote a shift to more sustainable modes of transport.

(5) Article 11 of the Treaty underlines the Union’s commitment to environmental protection and sustainability, emphasising the integration of environmental requirements into the definition and implementation of its policies and activities.

(6) Based on the Commission’s experience in applying Article 93 of the Treaty, certain categories of State aid that meet the needs of transport coordination are considered not to give rise to any significant distortion of competition and trade between Member States, provided that they meet certain clear compatibility criteria set out on the basis of the extensive decisional practice.

(7) This Regulation applies to operating and investment State aid measures granted in the sustainable land transport sectors.

(8) Aid that fulfils all the conditions laid down in this Regulation, both general and specific to the relevant categories of aid, should be exempted from the notification obligation laid down in Article 108(3) of the Treaty.

(9) State aid within the meaning of Article 107(1) of the Treaty not covered by this Regulation remains subject to the notification requirement laid down in Article 108(3) of the Treaty. This Regulation does not affect the Member States’ possibility to notify aid that has objectives that correspond to objectives covered by this Regulation.

(10) This Regulation should only apply to aid that meets the needs of transport coordination. By contrast, aid for the discharge of certain obligations inherent in the concept of a public service in the land transport sectors should continue to be governed by Regulation (EC) No 1370/2007 of the European Parliament and of the Council (4) or, where it does not meet the conditions laid down in that Regulation, should be notified to the Commission. Undertakings providing transport services entrusted with a public service contract should be able to benefit from aid granted under this Regulation provided in particular that Article 8 of this Regulation is complied with, and overcompensation is prevented.

(11) This Regulation should allow for greater simplification in line with the Commission’s objectives (5) and increase transparency, as well as effective evaluation and checks of compliance with State aid rules at national and Union levels, while preserving the institutional powers of the Commission and Member States. This is in line with the Commission’s Communication on EU State Aid Modernisation (6) and with the outcome of the fitness check carried out by the Commission in 2020 (7) highlighting the need to reduce administrative burdens and ensure efficient public spending.

(12) The general conditions for the application of this Regulation are laid down on the basis of a set of common principles that ensure the aid: (i) serves the purpose of transport coordination; (ii) has a clear incentive effect; (iii) is necessary, appropriate and proportionate; (iv) is granted in full transparency and subject to a control mechanism and regular evaluation; and (v) does not affect competition and trade to an extent that jeopardises the general interests of the Union.

(13) To ensure that the aid is necessary and acts as an incentive to further develop activities or projects, this Regulation should not apply to aid for activities or projects in which the beneficiary would in any case engage even in the absence of the aid. Aid should only be exempted from notification under this Regulation if the work on the aided project or activity starts after the beneficiary has submitted a written application for the aid. Buying land and preparatory works such as obtaining permits and conducting feasibility studies are not considered start of work on the aided project.

(14) As regards any ad hoc investment aid covered by this Regulation granted to a beneficiary that is a large enterprise, the Member State should ensure that,,in addition to complying with the conditions relating to incentive effect which apply to beneficiaries that are small and medium-sized enterprises (SMEs), the beneficiary has analysed, as evidenced by its internal documentation, the viability of the aided investment with aid and without aid. In such cases, the Member State should verify that such documentation confirms that the aid will result in a material increase in the scope of the investment supported by the aid, in a material increase in the total amount spent by the beneficiary on such investment, or in a material increase in the speed of completion of the investment.

(15) Automatic aid schemes in the form of tax advantages should be subject to a specific condition concerning the incentive effect, given that the aid resulting from such aid schemes is granted automatically. That specific condition means that those aid schemes should only support projects or activities on which works start after those schemes enter into force. However, this condition should not apply in the case of successor aid schemes, provided that the activity was already covered by the predecessor schemes in the form of tax advantages. When assessing the incentive effect of successor aid schemes, the crucial moment to be considered should be when the tax measure was laid down for the first time in the original scheme.

(16) Operating aid to reduce the external costs of transport meeting the conditions of this Regulation should be considered to have an incentive effect if the aid is passed on to the users and therefore increases the demand for sustainable transport services and a modal shift. Publicity is aimed at increasing awareness of the measures available to reduce the competitiveness gap between sustainable land transport modes and road-only or other competing less sustainable modes of transport. Publicity is hence considered to ensure that the aid is reflected in the price that users are asked to pay.

(17) For the purposes of transparency, equal treatment and effective monitoring, this Regulation should apply only to aid that may be calculated precisely in terms of its gross grant equivalent ex ante without the need to carry out a risk assessment (‘transparent aid’). For certain aid instruments such as loans, guarantees, tax measures and, in particular, repayable advances, this Regulation should define the conditions under which they can be considered transparent. Aid comprised in guarantees should be considered as transparent if the gross grant equivalent has been calculated on the basis of safe-harbour premiums laid down for the respective type of undertaking. It should also be considered transparent if before the implementation of the measure, the methodology used to calculate the aid intensity of the State guarantee has been notified to and approved by the Commission in accordance with a Commission notice on the application of Articles 107 and 108 of the Treaty to State aid in the form of guarantees (8). For the purposes of this Regulation, aid that involves a complex economic assessment in order to calculate precisely the gross grant equivalent of the aid ex ante (such as aid comprised in equity investments and quasi-equity investments) should not be considered to be transparent aid, unless the gross grant equivalent of such aid is considered to be the nominal amounts of such investments.

(18) To ensure that aid is proportionate and limited to the amount necessary, maximum aid amounts in terms of aid intensities in relation to a set of eligible costs should be laid down. Based on the Commission’s experience, the aid intensity should be fixed at a level that minimises distortions of competition and trade caused by the aided activity while appropriately addressing market failures or other obstacles to the coordination of transport.

(19) When calculating aid intensity, only eligible costs should be included. The identification of eligible costs should be supported by clear, specific and up-to-date documentary evidence. Aid which exceeds the relevant aid intensity should not be exempted from the notification requirements. All amounts used in the calculation should be taken before any deduction of tax or other charges. Aid payable in several instalments should be discounted to its value at the moment it is granted. The eligible costs should also be discounted to their value at that moment.

(20) The Commission should ensure that authorised aid does not affect competition and trade to an extent that jeopardises the general interests of the Union. Therefore, aid in favour of a beneficiary facing an outstanding recovery order following a previous Commission decision declaring an aid illegal and incompatible with the internal market should be excluded from the scope of this Regulation.

(21) Aid to undertakings in difficulty should be excluded from the scope of this Regulation. Such aid should be assessed on the basis of the Guidelines on State aid for rescuing and restructuring non-financial undertakings in difficulty (9).

(22) This Regulation consolidates the extensive experience acquired by the Commission in the assessment of operating aid designed to reduce the external costs of transport. Such aid should be quantified on the basis of the external costs that can be avoided by adopting a more sustainable transport solution instead of a competing, commercially viable mode of transport such as road-only transport. Aid can take the form of a reduction in the charges that transport operators pay for infrastructure use. Operating aid to reduce the external costs of transport should be covered by this Regulation only where distortions to competition and trade are limited and subject to well-defined conditions. This is the case where the external costs avoided are calculated in accordance with the rules and methodology set out in the Commission’s Handbook on the external costs of transport (10), where the aid intensity remains under certain thresholds, and where the aid is granted only for sustainable land transport services actually provided. This ensures that the aid is strictly limited to compensation for the external costs associated with using a more sustainable mode of transport.

(23) Furthermore, operating aid to support transport operators or transport organisers when launching new commercial rail freight or inland waterways freight connections should only be covered by this Regulation where distortions of competition and trade are limited and subject to well-defined conditions. This is the case where the aid amount is calculated in relation to the operating losses incurred by the beneficiary during the first five years of operation of the new commercial freight connection and the aid intensity remains under a certain threshold.

(24) Investment in railway service facilities, inland waterways facilities, rail or inland waterways multimodal transport facilities and in private sidings across the Union, is essential to ensure connectivity, sustainable functioning of the economy and cohesion among Member States. Such investments support the priorities of the Commission’s 2020 sustainable and smart mobility strategy (11), which prioritises the development of multimodal transport facilities. This Regulation should cover investment aid for the construction, upgrade and renewal of railway service facilities, inland waterways facilities, rail or inland waterways multimodal transport facilities, and private sidings. This Regulation should not apply to aid for port infrastructure (berths, jetties, etc.) and aid for port access infrastructure which are eligible pursuant to Commission Regulation (EU) No 651/2014 (12). This Regulation should, however, apply to aid for port superstructure (surface arrangements such as for storage, service facilities such as warehouses, as well as equipment used for the operation of facilities), as long as the superstructure in question is located in an inland waterways facility or a multimodal transport facility with a rail or inland waterways connection. For that type of aid, the administrative burden caused by the notification of straightforward State aid measures should be reduced, which also enables the Commission to focus on the potentially most distortive cases. The conditions for exempting investment aid to railway service facilities, inland waterways facilities, rail or inland waterways multimodal transport facilities, and private sidings from the notification requirement should limit distortions of competition and trade that would undermine a level playing field in the internal market. Trade and competition distortions are limited in particular by ensuring the proportionality of the aid.

(25) This Regulation should cover investment aid for the acquisition of vehicles for rail or inland waterways transport and certain categories of equipment instrumental to sustainable multimodal transport (i.e. Intermodal Loading Units and cranes on board vessels) only where distortions of competition and trade are limited. For the acquisition of certain types of equipment for sustainable multimodal transport, this is the case for aid schemes covering cranes on board vessels and part of the costs of Intermodal Loading Units and where the aid intensity remains under well-defined thresholds. For the acquisition of vehicles for rail or inland waterways transport, this is the case where the aid takes the form of a guarantee to the vehicle’s buyer subject to well-defined conditions. In the rail sector, SMEs and new entrants have difficulties in renewing or increasing their fleets because of the high investment costs of acquiring rolling stock and to difficulties in accessing finance. Small mid-cap undertakings (‘SMCs’) face similar challenges. In the inland waterways sector, most operators are SMEs or at best SMCs. This makes it difficult for them to renew or increase their fleet because of difficulties in accessing market financing. Therefore, investment aid in the form of guarantees to new entrants in the rail sector, to SMEs and to SMCs in the rail and inland waterways sectors, promotes sustainable transport without unduly distorting competition and trade.

(26) In line with the Union’s transport and digital policies, further efforts are required to enable communication between different transport information systems as well as coordination of transport networks and cross-border competition, and to improve transport safety in the Union. This is necessary because of the different standards of transport networks, the lack of technical harmonisation, incompatible tools and systems for data collection, and concerns about data sharing and data sovereignty. Furthermore, experience in assessing the measures for interoperability support notified under the 2008 Guidelines on State aid for railway undertakings (13) has shown that acute market failures exist because of coordination failures and the ‘first-mover disadvantage’, where the benefits linked to introducing specific technology or standard go beyond the commercial interest of transport operators.

(27) This is the case, for example, with train and traffic control systems such as the European Railway Traffic Management System (ERTMS). The ERTMS is a single European signalling and speed control system that ensures interoperability of national railway systems, reducing the purchasing and maintenance costs of the signalling systems and increasing the speed of trains, the capacity of infrastructure and the level of safety in rail transport. ERTMS is comprised of the European Train Control System (ETCS), i.e. a cab-signalling system that incorporates automatic train protection, the Railway Mobile Radio (RMR) and Automated Train Operation (ATO). The RMR system currently used for railway operations, namely the Global System for Mobile Communications – Rail (GSM-R), is based on specifications finalised 20 years ago. Because of technological obsolescence, industrial support for GSM-R is unlikely to be ensured after 2031. Given the limited negative effects on competition and trade that aid for interoperability has, and considering the experience acquired, such aid should be covered by this Regulation under well-defined conditions.

(28) To foster the competitiveness of transport by rail and inland waterways, it is also necessary to promote technical adaptation and modernisation in the sustainable land transport sectors. Aid for such investments should be subject to conditions that limit distortions of competition and trade which would undermine a level playing field in the internal market. In particular, the conditions for exempting such aid from the notification requirements should ensure the necessity and proportionality of the aid and include safeguards on the type of aid and the eligible costs.