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Saturday 22.09.2018 | Name days: Maigurs, Mārica, Māris

Riga Free port suffers heavy blow in litigation against PKL Flote

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The administration of Riga Free port (RFP), led by Leonid Loginov, has suffered a heavy blow in the litigation against PKL Flote. In 2011, The Competition Council (CC) fined the Board of RFP 105 thousand LVL for using a dominating position in bad faith and limiting the activities of the aforementioned enterprise on the port’s territory. RFP had turned to the court, but the Administrative Regional Court declined the plea of RFP to cancel the decision of the CC on January 7.

The CC and the Administrative Court both concluded that the RFP had unjustifiably denied PKL Flote the opportunity to offer tugboat services using Marss – 1 unit. On top of that, RFP had been using its dominant position in bad faith, because it did not create a fair division among tugboat service providers on the servicing of ships that have not specific tugboat service providers. The CC also concluded that in four cases the RFP unjustifiably refused PKL Flote to perform tugboat services and in ten cases limited the choice in relation to tugboat service providers at Riga port, thereby unjustifiably denying PKL Flote a chance to perform tugboat services in a full manner. Instead, the RFP performed tugboat services itself. This benefited RFP and caused harm to PKL Flote in terms of revenue, as well as presented concerns about losing clients, said the CC.

This action, possibly, created losses for ship owners as well, who were faced with declines to use services provided by PKL Flote, and were forced to pay more for relevant services to the administration of RFP, as concluded by CC.

PKL Flote is pleased with one more victory against RFP. This shows that there is still hope to resolve this issue in a judicial way,” – as the Director of PKL Flote Valery Ignatov commented the decision of the Administrative Regional Court to BNN.

It should be added that this is not the first fine administered by CC against RFP in the last several years. A 45 000 LVL fine was presented to RFP in March 2009. At the time, the CC had concluded that the RFP changed the collaboration rules when purchasing Santa and Stella tugboats and entering the market. This allowed RFP to create unjust advantages for itself in regard to PKL Flote. The RFP challenged this decision, but the Supreme Court declared it to be right and justified on July 1, 2011.

In April 2010, the CC applied another, 10 000 LVL large, fine to RFP for not complying with the March 2009 decision. The RFP challenged this decision as well, but the Supreme Court once again declared the decision legal and justified.

At the same time, Ignatov admits that even though several victories have been achieved in litigations against RFP, the port’s Board continues to set obstacles for PKL Flote, preventing the enterprise from working in Riga port. For example, on January 5, Bro Agnes ship required assistance, but seeing as though the RFP’s tugboats Santa, Stella and Sfinksa were occupied at the time, the captain of the ship was told to wait until one of them was free. PKL Flote offered its Tom tugboat, but the responsible pilot declined this solution, saying that it is too weak and has not been engaged in support of ships for a long time, as report of a responsible controller states.

“However, whenever the port has an emergency situation, it turn to PKL Flote for help. A fire broke out on Strādnieks tugboat on December 17, 2012. PKL Flote‘s tugboat Tom provided assistance in extinguishing the fire, while Santa, Stella and Sfinksa remained docked,” – adds Ignatov.

BNN previously reported that RFP suffered a major blow in a last year’s November litigation at the Administrative Court. Even though it was attempting to flush PKL Flote‘s tugboats from the port, the Board of RFP was ordered by the court to ensure that a five-year contract is signed with PKL Flote with permission to allow the enterprise to perform tugboat services within Riga port.


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