The UK and France have both failed to pass laws to allow an open market for rail services in the Channel Tunnel, the EC said.
It said it was now launching “infringement proceeding” against the two countries.
The Commission said the two countries should have passed legislation allowing for competition by 2003.
It said failure by either the UK or France to remedy the current situation will “result in further measures against these two countries.”
The EC “railway package” seeks to create an open market allowing competition including the independence of the infrastructure and open access to the track for train companies.
“More competition…will lead to better services and prices for passengers and freight traffic,” the EC said.
Eurostar has had a monopoly of passenger services since it began in 1994.
When rail passenger services were liberalised in the EU region from the beginning of 2010, other train companies have been free to start services through the Tunnel.
So far only Deutsche Bahn, the German network, has said it will start services from London St. Pancras to Amsterdam and Cologne and Frankfurt in 2013.
The EC said that if its first railway package is not fully implemented, “it could prevent the creation of an internal market for rail services in Europe.”
An internal market with “competition between different rail operators would encourage them to become more efficient and would result in more choice, better services and lower prices,” the EC said.