The European Commission (EC) has given its approval to a $761.46m (€687m) Italian package, aimed at compensating commercial long-distance rail passenger services providers hit by the pandemic.

The approval has been granted under EU State aid rules.

Commercial rail passenger operators, who were adversely affected due to Covid-19-induced curbs, will receive the compensation for the damage suffered during 1 July 2020 to 30 April 2021.

Under this scheme, eligible beneficiaries will be authorised to obtain compensation in the form of direct fundings for the damage suffered during the aforesaid period.

EC executive vice-president Margrethe Vestager said: “This $761.46m (€687m) measure will enable Italy to compensate long-distance rail passenger operators on commercial lines for the damage suffered as a result of coronavirus related restrictions.

“We continue working closely with Italy and all other Member States to ensure that national measures to support all sectors that were hit by the crisis, including the rail sector, can be implemented as quickly as possible, in line with EU rules.”

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The Italian Government introduced several measures to control the spread of the virus, since the start of the pandemic.

All these restrictions negatively impacted the mobility of material passenger categories like business and leisure commuters.

Additionally, during late December 2020 and April 2021, the government placed a nationwide ban on interregional travels.

In a statement, EC said: “Because of the mandatory restrictions in place, long-distance rail passenger transport operators experienced a drop in transport volumes and revenues. In particular, during the period between 1 July 2020 and 30 April 2021, passenger numbers fell by up to 90% compared to 2019, resulting in a significant drop in revenues for providers of rail passenger services.”

Furthermore, transport operators also incurred various costs, including extra expenditures to implement improved sanitary and hygiene measures.

This caused ‘serious’ liquidity problems, putting the competitiveness of rail transport operators at risk.

Last year in August, EC sanctioned two German schemes worth over $2.97bn (€2.5bn) to support the rail freight industry and the long-distance rail passenger sector.