Agreement on Rail Baltica implementation being signed today

30. September 2016 zur Übersicht

Artikel erschienen in Baltic Business Daily am 30.09.2016

Agreement on financing and implementation of the Rail Baltica railroad project has been reached and it will be signed in the three Baltic capitals today, as the Baltic joint venture RB Rail CEO Baiba Rubesa told Saeima European Affairs Committee today.

Technical work is under way today so nine Baltic institutions would physically sign the agreement, said Rubesa. She admitted that reaching the agreement had not been easy, taking into consideration the different laws and legal procedures in each Baltic country. That, however, is a problem characteristic of all projects involving several European Union member states.

According to the agreement, RB Rail will have the central manager's role in the project, explained Rubesa. The company will manage procurements, supervise implementation of the project, as well as marketing and business activities.

As reported, representatives of the three Baltic countries at the meeting of the RB Rail council agreed on September 7 on the further procurement model and responsibilities in implementation the Rail Baltica project. They decided to divide all procurements in three groups - procurements organized by the joint venture only, consolidated procurements implemented by the joint venture, and procurements implemented by national companies under supervision of the joint venture.

The Latvian Transport Ministry reported that the meeting was a turning point in cooperation among the Baltic countries to continue work on the project. The representatives discussed centralized RB Rail procurements and national procurements supervised by RB Rail.

BNS also reported, Michael Cramer, chairman of the European Parliament's Committee on Transport and Tourism, warned earlier that the Baltic countries risked losing EU funding for Rail Baltica if they proved unable to reach common ground on the project's implementation.

The Baltic countries had reportedly failed to agree on the distribution of Rail Baltica money. Lithuania feared that, with all orders conducted by the Latvia-registered company RB Rail, VAT would remain in Latvia. Lithuania has always wanted the VAT for the work done in Lithuania to stay in the country's territory. In July, ministers of Lithuania, Latvia and Estonia agreed on VAT distribution, however, the countries were still to reach agreement on the final financing scheme.