Lietuvos Geležinkeliai’s deal with Skinest Baltija fails to clear national security hurdle

A draft government resolution, prepared by the ministry, says that Skinest Rail’s owner Oleg Ossinovski “maintains relations with institutions of foreign states or natural or legal persons from those states which increase the risk or pose a threat to national security”.

Also, Ossinovski is a suspect in a corruption case in Latvia.

Lietuvos Geležinkeliai spokesman Mantas Dubauskas could not say on Wednesday if other contracts between the state railway operator and Skinest companies will be reviewed, noting that the law on deals by strategic enterprises came into force on March 1, 2018.

However, the spokesman did not rule out that Lietuvos Geležinkeliai might turn to the commission over its earlier contracts.

“Lietuvos Geležinkeliai considers turning to the Commission for Coordination of Protection of Objects of Importance to Ensuring National Security regarding its earlier contracts with Skinest and future deals if the company bids for contracts in the future,” he told BNS.

Ossinovski, who is said to be one of the wealthiest people in Estonia, is at the center of a major corruption scandal in Latvia. The Estonian citizen is suspected of giving a bribe of 500,000 euros so that Latvijas Dzelzcels RSS, a subsidiary of Latvia’s state railway company, would buy four old locomotives from Skinest. A criminal case has been brought against Ossinovski.

Lietuvos Geležinkeliai in April asked the commission and the Lithuanian Financial Crime Investigation Service (FNTT) to look at whether its purchases meet the highest transparency criteria and the state’s interests.

Skinest Baltija submitted the lowest price offer in the tender for sleepers, 200,000 euros lower than another unnamed bidder.