The European Commission opened an investigation into Italy’s rail freight transport market for possible breach of EU state aid rules.

The Commision will examine measures that favoured companies within state-owned railways group Ferrovie dello Stato, namely its freight transport units Trenitalia and FS Logistica, it said.

In particular it will investigate the transfer of railway infrastructure assets to the two Ferrovie dello Stato’s units for free between 2007-2011, saying that these transfers might also affect trade between member states.

It will also look into payments Italian authorities have made to Trenitalia since 2000 under an obligation the company had to transport freight from and to southern Italy to ensure a universal service.

The Commission said public service obligations might not be necessary for freight services in substantial parts of Italy, given that competitors were already providing similar services without such compensations.

Ferrovie dello Stato said it would cooperate with Italian and European authorities to help resolve the case quickly.

It added that the group had accumulated significant losses on public freight transportation services over the years as compensations were well below the costs of running the services.

There was no timetable given for the EU to conduct its investigation. Italy will have to recover the aid if it is found to be illegal.

The rail freight market was liberalised in 2003 in Italy and in 2007 at the EU level. Trenitalia and other Ferrovie dello Stato companies compete on the freight transport market at national and EU level with domestic and international rivals.

The Ferrovie dello Stato group is among the largest players in Europe in the rail freight market. In Italy it competes against rivals from countries like France, Switzerland and Germany. (Reuters)