The German rail operator Deutsche Bahn has launched legal action against a decision by the Federal Network Agency (Bundesnetzagentur) requiring it to free up capacity on heavily used rail routes for competitors. The move comes amid plans by the Italian company Italo to enter the German long-distance rail market starting in 2028. Deutsche Bahn’s infrastructure subsidiary, DB InfraGo, is seeking an expedited ruling from the Administrative Court in Cologne to challenge the legality, proportionality, and practical feasibility of the agency's order. This dispute highlights concerns over how prepared Germany’s long-distance rail system is for increased competition, with critics suggesting it is far from ready. The Federal Network Agency mandated that Deutsche Bahn allocate at least one-quarter of its capacity on highly utilized routes to rival operators. This requirement aims to ensure that alternative providers can access the network, promoting greater choice and potentially lower prices for passengers. The directive applies particularly to key corridors such as those around Munich and Frankfurt, which have defined upper limits on capacity. The decision follows a complaint filed by Italo, which seeks to establish itself as a major player in the German rail sector. Deutsche Bahn argues that implementing this rule would complicate the allocation of track usage, leading to more conflicts among operators. Each year, rail companies must submit their planned route schedules to DB InfraGo, and disputes often arise due to limited track availability shared by long-distance, regional, and freight services. The company claims the new requirements could create legal and operational challenges for managing track capacities effectively. The Federal Network Agency expressed no surprise at the legal challenge, stating that the arguments presented by Deutsche Bahn had already been considered during the review process. Officials emphasized that fostering fair competition benefits consumers by increasing options and reducing costs. Currently, Deutsche Bahn holds a dominant position in the long-distance passenger rail market, controlling approximately 93 percent of all services. Italy’s Italo is not the only potential competitor eyeing the German rail market. Flixbus, based in Munich, announced plans earlier this year to expand into long-distance rail travel with new trains and routes by 2028. However, despite efforts to carve out a niche, Flixbus has struggled to make a significant impact, with its cheaper tickets offering little real alternative to traditional services, especially given its own issues with delays and cancellations. The situation has drawn attention to the broader question of whether Germany’s rail infrastructure is equipped to handle increased competition. While smaller players like Flixbus have made incremental gains, they remain marginal compared to Deutsche Bahn’s entrenched dominance. The arrival of Italo, however, has introduced a new dynamic, pushing the system to its limits. Italo is demanding framework agreements and assurances for its substantial investment, yet it faces immediate hurdles in securing track access through DB InfraGo, which operates under state mandate and is a subsidiary of the parent company. Critics argue that the relationship between Deutsche Bahn and DB InfraGo raises questions about impartiality, even though both claim to act in the public interest. Despite these concerns, the legal battle underscores the need for clear regulatory frameworks that enable fair competition while ensuring efficient operation of the rail network. The outcome of the court case could set a precedent for future interactions between regulators and rail operators in Germany. The political response to date has been cautious, with ministers expressing support for competition but falling short of taking decisive steps to create the necessary conditions for it to function fairly. As the legal proceedings unfold, the focus will shift to whether courts can provide clarity on the regulations and whether policymakers will take meaningful action to address the structural challenges facing the rail industry.
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