Commission adopts new State aid rules to boost the use of more sustainable ways of transport

This article is brought to you in association with the European Commission.

The European Commission adopted today the State aid Land and Multimodal Transport Guidelines (LMT Guidelines) and the State aid Transport Block Exemption Regulation (TBER). These instruments support more sustainable transport modes for both passengers and freight and update the EU State aid framework for land and multimodal transport. They will enter into force on 30 March 2026. The TBER will be in place until 31 December 2034. There is no end date for the LMT Guidelines.

The new rules replace the 2008 Guidelines on State aid for railway undertakings. The LMT Guidelines and the TBER establish a coherent State aid framework covering a broad range of sustainable transport modes and aid measures, while maintaining safeguards to prevent undue distortions of competition.

State aid Land and Multimodal Transport (LMT) Guidelines

The LMT Guidelines set out the conditions under which State aid that has to be notified to the Commission for approval before it can be granted may be declared compatible with the internal market. The new Guidelines include the following provisions:

• They cover all land transport modes that are more sustainable than road transport. These include rail, inland waterways and sustainable multimodal transport. When it comes to multimodal transport, at least one of the used transport modes has to be rail or inland waterways, or combine land transport with short sea shipping;
• They clarify the possibilities for several operating and investment aid measures, such as aid for the construction and upgrade of railway service and inland waterways facilities, aid to launch new commercial connections on rail and inland waterways, and they clarify the possibilities for aid in the form of reimbursement for the discharge of public service obligations in the rail freight sector.
• They introduce more flexible rules for aid measures that directly contribute to the green and digital transitions. This includes aid aimed at reducing the external costs of transport, as well as aid promoting interoperability, like aid for safer and more efficient operation across national rail systems. These provisions are designed to support a shift from road to more sustainable ways of transport, while ensuring that aid remains targeted and proportionate.
• They introduce safeguards to support the entry and growth of new operators in sustainable land transport markets. They facilitate access to finance for SMEs, small- and mid-caps (SMCs) and new entrants to purchase rolling stock and inland waterway vessels, while preserving effective competition.

State Aid Transport Block Exemption Regulation (TBER)

The TBER complements the Guidelines by exempting certain categories of aid in the rail, inland waterways and sustainable multimodal transport sectors from the requirement of prior notification to and approval by the Commission.

This new exemption framework constitutes a major simplification, enabling Member States to quickly provide aid where conditions are met. As a result, Member States can now implement many measures without the need for prior approval by the Commission. This is in line with the Commission’s approach to focus on delivering more and faster, while reducing undue administrative burden. The categories of aid and rules contained in the TBER widely mirror the LMT Guidelines.

Background

The adoption of the LMT Guidelines and TBER follows the conclusions of the 2019 Fitness Check on the existing rules applicable to the sustainable land transport sector. This exercise showed that the Railway Guidelines made an important contribution to encouraging a modal shift to rail and to promoting interoperability. At the same time, the evaluation showed that adjustments were needed to reflect market and technological developments and the current EU’s strategic priorities.

In October 2021, the Commission published an inception impact assessment concerning the revision of the Railway Guidelines and a roadmap for a new block exemption regulation for railway, inland waterway and multimodal transport. In December 2022, the Council adopted an Enabling Regulation, authorising the Commission to adopt this new block exemption regulation. In March 2024, the Commission published a call for evidence on the TBER, followed by a public consultation inviting all interested parties to comment on the draft LMT Guidelines and TBER. All these evaluation measures fed into the Guidelines and Regulation adopted today.

The revised rules are accompanied by an Impact Assessment Report that sets out the scope, content and likely impacts of the new rules and summarises the information received during the consultation activities organised by the Commission.

For more information

LMT Guidelines and TBER

All transport legislation

2008 Guidelines on State aid for railway undertakings

Revision of the Railway Guidelines inception impact assessment

New Land Transport Enabling Regulation Roadmap

Call for evidence

Public consultation