Deutsche Bahn Proposes Remedies to Settle EU Antitrust Probe

Deutsche Bahn AG, Germany’s state-owned railway, proposed remedies in a bid to settle a European Union antitrust probe into prices a unit charges for power used by trains.

The European Commission last year opened a formal probe into Deutsche Bahn’s DB Energie unit, the only supplier of traction current in Germany, and whether it offers discounts that may inflate prices for Deutsche Bahn rivals, putting them possibly at a “competitive disadvantage.” Traction current is electricity used to power locomotives.

The proposed settlement commitments include a new pricing system for traction current “with separate supply prices for electricity and separate grid-access fees,” the EU said today. “In this new system, DB Energie will charge the same price for electricity to all railway undertakings without volume- or duration-based discounts.”

Deutsche Bahn had already planned to change the pricing system and agreed to the concessions to swiftly end the dispute, company spokesman Gelfo Kroeger said in an e-mailed statement. Deutsche Bahn didn’t accept the commission’s “unfounded allegations” under the agreement, he said.

The Brussels-based EU regulator is now testing the company’s proposed remedies with rivals and interested parties, according to the EU filing.

Potential Competitors

The EU watchdog in 2011 raided Deutsche Bahn’s offices to check allegations that DB Energie was favoring the group’s rail-freight arm over others. EU Competition Commissioner Joaquin Almunia has said that enforcement must give potential competitors in industries dominated by former state monopolies “the opportunity to launch their own services and compete effectively.”

Under the proposed commitments, railway companies that don’t belong to the DB Group also will get a “one-time retroactive refund” of 4 percent of their traction-current invoice for the year preceding the new pricing system, the EU said in the filing.

The remedies would last for five years once they have been made legally binding, which will happen in case of a successful market test and at the earliest on Jan. 1, 2014. Rival and interested parties were given one month from today to respond to the proposed commitments.

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