Lithuanian Railways under EC anti-trust scrutiny over dismantling track to Latvia

However, the minister thinks that it is Latvia, rather than the crude refinery Orlen Lietuva, that needs the railway track between Bugeniai, in Lithuania, and Renge, in Latvia.

“If we saw that our arguments are insufficient, we would decide whether to go to the Court of Justice or to rebuild that track,” he told BNS.

Before the Commission has made a decision in its antitrust investigation against the state railway company, Lithuania will discuss the matter with the EU’s executive body, Sinkevičius said.

The minister thinks that it is Latvia that wants the track to be rebuilt because it expects to use it for transporting freight from its port.

“As far as I understand, Orlen doesn’t need that track very much, but Latvians expect to be able to transport a part of freight from their port using that track,” he said.

The ministry estimates that rebuilding the railway track would cost around 40 million litas (EUR 11.6m).

“In order to rebuild the track, we have to look at how much this is economically beneficial for the company and the state. The track was dismantled in 2008 and then the (economic) crisis came. Funds allocated for investments go toward international projects, those that bring real benefit,” LG spokesman Vidmantas Gudas told BNS.

The European Commission said on Monday that it had sent a statement of objections to LG. The EU’s executive body suspects the state railway operator of having limited competition in the Lithuanian and Latvian rail markets by removing the railway track in 2008.

The Commission opened formal antitrust proceedings against LG in March 2013. Poland’s oil group Orlen, which owns Orlen Lietuva, the only crude refinery in the Baltics, in 2011 filed a complaint with the Commission over the dismantling of the Bugeniai-Renge track.

According to the Commission’s press release, LG in September 2008 suspended traffic on the railway track and dismantled it a month later. The track has not been since rebuilt.