OREANDA-NEWS. February 10, 2011. FAS Russia held a meeting of the Expert Council on Railway Transport, attended by members of the FAS Russia’s Expert Council, representatives of federal executive bodies, the Federal Tariff Service, the Ministry of Transport of the Russian Federation, and “Russian Railways” OJSC, reported the press-centre of FAS Russia.

The agenda included the following items:

1. On the composition and the types of services rendered by the owners of railway tracks that are not in common use, including the signs (criteria) of the services subject to tariff regulation and control by the antimonopoly bodies.

2. On improving the existing legislative norms of government regulation of the tariffs and fees for the services rendered by the owners of railway tracks that are not in common use.

3. On the impact of tariff de-regulation on forwarding multi-tonnage containers (containerized cargo) in transit railway transportation across the Russian Federation, on increasing the transit potential of the Russian Federation and developing competition in railway transport.

4. On 2011-2012 work schedule of the FAS Russia’s Expert Council on the issues related to railway transport.

Participants established that currently the tariffs for the services on railway side tracks rendered by the companies of industrial railway transport are regulated by the executive bodies of the Russian Federation in accordance with No.239 Decree of the Government of the Russian Federation of 7th March 1995. The Federal Tariff Service regulates activities on the sidetracks that are not in common use and belong to the owner of the “common good” infrastructure (“Russian Railways” OJSC).

Participants also emphasised a lack of uniformity in the approaches of the executive bodies of the constituent territories of the Russian Federation to definition of the subject of regulation, in terms of the list of works / services provided by the companies of industrial railway transport on the rail tracks that are not in common use.

Technologically, the works / services on the rail tracks that are not in common use are inseparably integrated to the shipment by railway transport in common use, in the part of terminal operations when hauling goods by railway transport in common use regardless of the goods ownership (by “Russian Railways” OJSC or by independent economic entities).

In the opinion of the Expert Council, the Federal Tariff Service, jointly with the involved federal executive bodies including FAS Russia, must draft and approve the standard Procedures for regulating the tariffs for the services of the owners of the railway tracks that are not in common use in order to develop a unified approach of the regulatory bodies of the constituent territories of the Russian Federation to regulation of the works / services on the side tracks that are not in common use and are not owned by “Russian Railways” OJSC.

This normative legal act should establish:

- The criteria for determining whether the services of the owners of rail tracks that are not in common use must be regulated, and the closed list of such services;

- The procedures for the subjects of regulation filing the petitions and the procedures for regulators considering petitions for fixing and changing the tariffs for regulated services of the owners of railway transport that is not in common use.

In particular, it should cover the period for petition consideration, the procedures for appealing the decisions and the procedures for bringing the interested parties in the petition consideration.

Regarding the government regulation of the tariffs and charges for the services of the owners of railway tracks that are not in common use, the Expert Council noted that the current legislation, first of all, the laws on railway transport – No.17-FZ “On the Railway Transport in the Russian Federation” of 10th January 2003 and No.18-FZ “The Regulations of the Railway Transport in the Russian Federation”, contain a number of ambivalent provisions, which creates unequal conditions in rendering services and using the infrastructure in common and not in common use.

Therefore, the Expert Council would like to draw attention of the authorised federal executive bodies to the need to introduce appropriate amendments to the normative legal framework in terms of regulating the work of railway transport in common and not in common use.

The Expert Council also pointed out that the main transit freight traffic flow between Europe and Asia take place in multi-tonnage containers; and due to the geography of Russia it such traffic flows are routed via the railway transport system of the Russian Federation.

Alternative routes for delivering containers (containerized cargo) are the shipping lines and railway infrastructure in the neighbouring countries, which by-pass the Russian Federation. Transportation services in the Russian Federation are regulated and in the neighboring countries they are based on the free-market mechanisms.

As the tariffs for transit container freight (containerized cargo) by railways are heavily regulated by the Russian Ministry of Transport, it is difficult for Russia to develop competitive offers in terms of the transportation costs and to promptly respond to the changing market conditions in container transportation (containerized cargo) between the points of cargo origin (Asia) and cargo delivery (Europe).

One of the main factors preventing effective encouragement of transit flows of containerised goods to the Russian railway infrastructure is the absence of flexible pricing policy, which is due to strict regulation of the tariffs for transit container transportation (containerized cargo).

Members of the Expert Council have noted the position of the Russian Ministry of Transport that deregulating transit transportation would be inexpedient. The FAS Russia’s Expert Council believes that deregulation and flexible pricing policy for transportation of containers (containerized cargo) across the Russian Federation is necessary and appropriate decisions must be made. It will create equal conditions for the Russian railway system competing in the global market and will allow taking advantage of the transit potential of the Russian Federation.