The European Commission is examining a complaint made by private transport companies over State aid given to Dublin Bus and Bus Éireann.

Private operators claim there is a conflict of interest because the Government subsidises Dublin Bus and Bus Éireann, but also acts as the regulator in the transport market, deciding on licences for operators and allocating routes.

A spokeswoman for the commission confirmed it had received the complaint. "We are examining it to see if there are any grounds for formal procedures," she said.

The Coach Transport and Tourism Council (CTTC), which has been lobbying for a greater slice of the transport market, made the complaint on behalf of the larger private operators after commissioning a report which showed that subsidies on routes that compete with private operators could be illegal under EU competition laws.

The group sent a copy of the report to the Minister for Transport, Martin Cullen, but says it has yet to receive a satisfactory reply.

"We felt this [a complaint to the commission] was the only way to go forward," said Feargal Barton, chairman of the council.

The Government informs the European Commission each year of the subsidies it wishes to pay to Dublin Bus and Bus Éireann and to date no problem had been raised from Brussels, a spokeswoman for the Department of Transport said.

The council said it was also angry that Dublin Bus has asked the Minister for 200 new buses, some of which they say will run on new routes.

The council said this was despite the fact that Mr Cullen promised them 15 per cent of the new market.

"If Dublin Bus receives these 200 buses asked for, that will represent the next 20 per cent of the market," said Mr Barton.

The council also wants the Government to set up an independent regulator, which would oversee a review of the transport market and tender for new transport routes.

Dublin Bus said it received 26 per cent of its operational costs from the Government, which represented one of the lowest subsidies given to a state-run bus company across Europe.

"We're not against competition or new operators and feel they have a role to play . . . but we don't want to see any good work being eroded," said Gráinne Mackin, spokeswoman for Dublin Bus.

Meanwhile, the Minister for European Affairs, Noel Treacy, said last night that the Government had secured a significant foreign policy success by negotiating an EU declaration in support of a strong state aid policy that also supported competitiveness.

Mr Treacy said the declaration, which is contained in the draft conclusions of the forthcoming European Council meeting, represented a change of mindset at EU level on state aid that had recently been a source of disagreement between Dublin and Brussels.

The declaration states that "the review of state aid should encourage a high level of investment in Europe and make Europe attractive for future investment".

Brussels' decision last year to block State funding worth €170 million to Intel caused a rift with the commission over the future direction of its policy on state aid.

The European Commission is currently undertaking a review of state aid policy, and a declaration by EU leaders in favour of a strong state aid approach could help Ireland in its goal to be able to co-fund large investment projects by companies such as Intel.