The payment of State grants to CIE is governed by three EC regulations as follows: Regulation EC No. 1191/69 provides for payments by the State in respect of losses incurred in providing essential public transport services; Regulation EC No. 1192/69 provides for payments by the State in respect of specified financial burdens borne by the railways such as the costs of the maintenance and control of level crossings; and Regulation EC No. 1107/70 provides for the payment of compensation in respect of rail freight infrastructure costs, residual deficits on railway operations and losses on road passenger services which cannot be recouped by fares increases or eliminated by economies in operation.
In the case of the majority of other EC States it is understood that state grants in respect of railway services are included as revenue in the accounts of the appropriate railway undertakings.