Financial Services, Latvia, Legislation, Port, Transport

LETA was told at the State Audit Office that since 2009 when the Competition Council imposed the first fine on the port authority for breaching competition rules by abusing its dominant position in organizing tugboat services in the port, the Freeport of Riga Authority has spent more than EUR 1.5 million on this and successive fines, as well as legal expenses. The fines charged by the Competition Council make up EUR 850,000 and legal costs EUR 200,000 of this amount.

On examining the situation in the port, the auditors came to the conclusion that after paying the first EUR 64,000 fine, imposed by the competition watchdog, the Freeport of Riga Authority could have dealt with the problems and stop abusing its dominant position in the tugboat business to avoid further expenses.

Another opportunity to stop paying fines came in 2013 when the State Audit Office advised the Freeport of Riga Authority to restructure its fleet and fold its tugboat business. This would have spared the port authority new inquiries and fresh penalties, such as a EUR 620,000 fine charged in 2015.

Since the Freeport of Riga Authority ignored the state auditors' recommendations, the Competition Council imposed two more fines, increasing their total amount to EUR 850,000.

"The systematic failure to assess such violations and the failure to call the responsible officials to account discredits the rule of law and sends wrong signals to all the law-abiding heads of other institutions," Auditor General Elita Krumina said, criticizing the ministry in charge and the port's officials for their reluctance to deal with the violations of competition rules.