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Kālija parks considers taking international legal action because of Ventspils Freepor’s behaviour

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Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUKālija parks shareholders are prepared to launch international legal action against the state of Latvia in relation to the plans of Ventspils Freeport to terminate the land lease contract with the company and take over structures of the terminal that are located on the freeport’s owned territory, as noted by the company’s representatives.

«Attempts by [Chairman of Ventspils Freeport and Ventspils City Council] Aivars Lembergs and the management of Ventspils Freeport to terminate the land lease contract with Kālija parks and take over the terminal is nothing more than an illegal attempt to expropriate the company’s property. Public resources are being exploited to serve Lembergs’ private interests. Lembergs is one of the true beneficiaries from 50% of Kālija parks,» – the company explains.

According to Kālija parks, the rest of the 50% of shareholders are foreign investors. «The decision of Ventspils Freeport to claim Kālija parks’ assets is an attack on foreign investments, which are protected by international law. The Republic of Latvia is responsible for this, because representatives of Ventspils municipality and the ministry make up the majority of Ventspils Freeport’s management board,» – Kālija parks states.

Representatives of the company ask Prime Minister Maris Kucinskis to put an end to this unprecedented property expropriation. If these illegal attempts are not stopped, shareholders of Kālija parks are prepared to take legal action against the state of Latvia.

«These illegal attempts are a signal to all foreign investors that their investments in Latvia can be potentially arbitrarily taken away at any moment if it benefits Ventspils Freeport and/or Aivars Lembergs. There is not a single mention in the contract between Kālija parks and Ventspils Freeport that requires the company to reach a specific cargo turnover level. It would be impossible, considering railway tariffs in Latvia, mutual sanctions between Russia and the European Union and the situation on the world market. All of it has impacted the flow of cargoes carried through Latvia’s ports,» – the company explains.

At the same time, Kālija parks representatives say the management of Ventspils Freeport manages the port from a position of public power. «Kālija parks has already requested Ventspils Freeport management board to apply public rights to this dispute. This would provide more protection to Kālija parks, but Ventpils Freeport board wishes to resolve the case as a private case, as though it were a dispute between two private companies. It only demonstrates the lawlessness of Lembergs’ illegal attempts,» – the company continues.

It should be added that Lembergs announced this week that Ventspils Freeport board has decided to use legal action to terminate the land lease contract with Kālija parks and take over the structures of the terminal that are located on the freeport’s territory.

Lembergs explained this decision with unsatisfactory results of the company.

On 2 September, Ventspils Freeport board decided to ask the freeport’s manager Imants Sarmulis to ensure the preparation of the legal application and its submission to the court in order to terminate the land lease contract, as well as enforcement of penalties and lost revenue from the land lease from Kālija parks and recognize ownership rights of Ventspils Freeport for Kālija parks’ buildings and structures located on the territory of the freeport that is currently leased by Kālija parks.

Throughout the years Kālija parks has been informing Transport Ministry about the non-competitiveness of the tariffs for the use of railway infrastructure in Ventspils’ direction. Unreasonably high tariffs hurt the company’s competitiveness. Latvia has to change its railway tariff policy to help existing terminals attract cargoes, not gradually destroy them, notes the company’s board member Aivars Gobins.

Kālija parks and its shareholders will defend their stance and will use all available legal options in Latvia and international institutions. It is clear to shareholders that as long as Aivars Lembergs has the deciding vote in Ventspils Freeport management and as long as its board members from ministries and Ventspils City Council go along with him, foreign investments in Ventspils Freeport will not be safe, Gobins says.

Baltic Coal Terminal is another association that works at Ventspils Freeport and suffers from the trend, in which terminals are forced to pay money to Ventspils Freeport without any justification. When it comes to companies controlled by Lembergs, however, the situation is completely different. Baltic Juice Terminal often remained without work for years, but Ventspils Freeport took no action to take over its terminal, Gobins said.

Ref: 102.109.109.9811


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