(FRANKFURT) - The German railway Deutsche Bahn has set aside 310 million euros (490 million dollars) in provisions in case the European Union commission forces it to reimburse possible state aid, a press report said Friday.

The EU commission was investigating whether a 2.1-billion-euro contract that Deutsche Bahn received from the German states of Berlin and Brandenburg for regional train service from 2002 to 2012 violated EU regulations, the Financial Times Deutschland reported, citing supervisory board sources.

The contract provided the German rail operator with a sales margin of 10 percent, the report said, while the EU regards a margin of three to five percent as common.

A Deutsche Bahn spokesman told AFP the railway would publish financial results Monday and said "the link made by the Financial Times Deutschland between provisions taken by the company and the EU procedure were false."

Regional train connections are Deutsche Bahn's most lucrative operations, and with the company hoping to publicly list shares as soon as possible, an EU sanction would represent a major setback to what is already a politically sensitive issue.

The newspaper report said Deutsche Bahn officially explained the provisions as intended to meet rising energy and personnel costs.

Text and Picture Copyright 2008 AFP. All other Copyright 2008 EUbusiness Ltd. All rights reserved. This material is intended solely for personal use. Any other reproduction, publication or redistribution of this material without the written agreement of the copyright owner is strictly forbidden and any breach of copyright will be considered actionable.