Is the Danish state’s financing of the Femern project illegal state aid under EU rules? That is what the shipping company Scandlines believes, having filed a case against the Danish state at the EU Court. Initially, the European Commission approved the financing of the project, but the EU Court overturned the Commission’s decision. This led the Danish state to file a case against the European Commission. And to add to the confusion, Scandlines has also filed a case against the European Commission, arguing for a reversal of the approval.
Is capital and loans state aid?
In short, the question in this complex of cases is whether it constitutes illegal state aid when the Danish state contributes capital and provides loans to Femern A/S Land Facilities. According to Scandlines, this gives Femern A/S an unfair competitive advantage over other actors.
Femern A/S does not set the price
On the other hand, the Danish state does not believe that loans, guarantees, and capital injections violate state aid rules. The state points out, among other things, that Femern A/S is not allowed to determine the price for using the Femern Tunnel. This price is set by the Danish Minister of Transport. This also means that Femern A/S does not perform an economic activity, and therefore, it is not a case of state aid, claims the Danish state.
“When the three judgments are available, the Ministry of Transport will assess any consequences for the financing of the Femern Belt project. I will inform the Transport Committee about the judgments and the possible consequences thereof,” writes Transport Minister Thomas Danielsen to the Parliament’s Transport Committee.
Potential precedent
It is highly questionable whether the cases will have actual consequences for the Femern project, which is already well advanced. However, they may affect what it will eventually cost to drive through the Femern Tunnel if changes are required in the project’s financing. The judgments will likely also set a precedent for future infrastructure projects within the EU.
Judgments in all three cases will be delivered on February 28th.
