News / Swissterminal heads to court over government subsidies to Gateway Basel Nord

© Swissterminal

Swiss container terminal operator Swissterminal has lodged an official complaint against the Swiss government over what it called unfair state aid in the construction of the new Gateway Basel Nord.

The complaint, which was lodged with the Swiss Federal Administrative court last month, alleges that the July decision of Switzerland’s Federal Office of Transport (FOT) to fund 75% of the costs of the first phase of the GBN, amounting to CHF83m ($84.4m), represented a “severe threat to competition in terms of container terminal handling services” in the country.

Swissterminal argued that the funds would restrict competition and said: “A key issue of the complaint is the infringement of economic freedom and fair competition through the federal government’s commitment to subsidise nearly CHF8m.

“The federal funds will finance a project through which private market players will be squeezed out of the market and ultimately eliminates or, at least, massively distorts current competition.

“The FOT’s decision also violates international regulations because the free trade agreements between Switzerland and the EU clearly rule out such kinds of federal subsidies that lead to impediments to the international movement of goods linked to the European Union’s market,” it said in a statement.

It also argued that FOT failed to demonstrate why the project needed the funds: “The complaint states that the FOT has not carried out the mandatory fact-finding process in a proper manner, but rather in an extremely biased way, because it simply followed the reasoning of the future gateway operators without any verification.

“Examples of this are the forecasted volume development, the claimed productivity growth, and the predicted shift of traffic from road to rail,” the company added.

And it further questioned whether rail operator SBB, which will operate the terminal, would be able to fund the remaining 25% of the project.

“In Swissterminal’s view, the financing of the remaining quarter of Gateway Basel Nord is questionable as well. Even though this part of the funds required should be met by GBN AG itself, the fact is that SBB Cargo is highly indebted and does not have the appropriate means for funding itself.

“It therefore needs to be examined whether the funds required originate from funds that SBB AG received for its subsidised business unit. If so, this would represent an unlawful cross-subsidisation,” it said.