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Wednesday 01.04.2020 | Name days: Dagne, Dagnis

Landmanis: FKTK needs to explain what banks should do with Ventpils Freeport companies

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Aivars Lembergs, wages, banks, BATL, FKTK, Ivars Landmanis, Māris Bremze, transit It is necessary for the Finance and Capital Market Commission (FKTK) to explain to banks how they should act towards companies operating from Ventspils Freeport. «Then companies will be able to prove on their own if they are controlled or not controlled by a person under sanctions,» says Baltic Association – Transport and Logistics (BATL) CEO Ivars Landmanis.

Banks are waiting for explanations from FKTK about what exactly they should evaluate in companies, whereas FKTK says banks have to determine why the situation has become so chaotic, says Landmanis.

He said the general situation for port-based companies has been resolved, but there is still increased supervision from banks. On top of that, some companies experience problems with transactions.

«This kind of situation has appeared for the first time for Latvia, and it is unclear what banks should focus on. This is about companies in which the office of the prosecutor has arrested the shares owned by the person under sanctions (Lembergs) and has delegated control over them to another person. The person under sanctions has no influence or control over such a company and the person is not paid any money from them,» says Landmanis, adding that active work with FKTK continues to resolve the situation in its entirety.

Landmanis also admits that if the situation with banks is not resolved, the companies in question may experience serious problems in the future.

More on this topic: Transit industry: it is unacceptable for thousands of people to not receive wages because of Lembergs

When asked if the port is losing customers and freights because of sanctions, Landmanis said no, adding that initially in December, shortly after the decision from the US Department of the Treasury Office for Foreign Asset Control to apply sanctions against Aivars Lembergs, there was some commotion and several ships decided not to enter Ventspils port, but the situation has been resolved since then.

«We have also asked the government to explain to foreign partners that the situation has been resolved,» Landmanis added.

He also said the volume of freights handled by the port has decreased, but this is mainly due the fact that the port does receive coal, which is due to reduced demand. ‘This is related to market price – warehouses of countries that procure coal are full,’ said Landmanis.

Railway freight carried LLC Baltic Express board chairman Māris Bremze said the only consequences from sanctions the company fees is that some employees have a difficult time with receiving salary, which may be a problem with a specific credit institution. This problem was observed in December and January. It has since been resolved and employees have received their salary.

Bremze also stresses that the biggest problem now is observed with coal freights, which are not supplied due to a decline of demand.

On 9 December 2019, based on the so-called Magnitsky Law, OFAC imposed sanctions against a number of persons and their organizations in Europe, Asia and Latin America, including Lembergs, for corruption.

Read also: Minister: Ventspils City Council needs to reduce Lembergs’ influence over municipality

In response to Ventspils Freeport authority’s addition to the list of sanctions, Saeima amended laws to have Ventspils Freeport and Riga Freeport taken over by the state. On Tuesday, 17 December, the government supported Transport Ministry’s proposal to found a new state company to take over management of Ventspils port territory and operations.

On 18 December 2019, OFAC announced removal of sanctions from Ventspils Freeport and Ventspils Freeport authority.

Sanctions were lifted from Ventspils Freeport after Lembergs stepped down from his positions in the board of the freeport and Latvian government took measures to exclude his influence over the port, according to the statement released by the US Department of the Treasury.

Lembergs has also stepped down from posts in multiple organizations, including Latvian Olympic Committee’s executive committee and basketball club Ventspils.

Corruption Prevention and Combating Bureau (KNAB) has commenced an inspection to see if the ties between the Union of Greens and Farmers (ZZS) and AIvars Lembergs are grounds for not providing the party with state funding. This, however, is not enough for ZZS to cut its ties with Lembergs.

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