Estonia, Port, Transport

International Internet Magazine. Baltic States news & analytics Monday, 21.05.2018, 19:49

Estonian EconMin fines new ferry operator EUR 400,000

BC, Tallinn, 06.01.2017.Print version
The Ministry of Economic Affairs and Communications on Friday forwarded to the Port of Tallinn subsidiary TS Laevad its decision to fine the company 400,000 euros over delays of new ferries to serve the routes connecting Estonia's large western islands with the mainland, inform LETA/BNS.

"One new ferry has arrived by today and the next one will start the journey within a few days, but the carrier as a contractual partner, i.e. TS Laevad, is responsible for fulfilling the contract. According to the agreement, new ferries were supposed to enter into service on Oct. 1 last year. The failure to put the ferries into operation on time entails a penalty," Minister of Economic Affairs and Infrastructure Kadri Simson said in a press release.

TS Laevad can in turn claim penalties from the Turkish and Polish shipyards that failed to deliver the ferries on time, she said.  

Under the contract between the state and TS Laevad, four brand new ferries were to start regular service on the island routes on Oct. 1, 2016. Although TS Laevad, a subsidiary of the state-owned Port of Tallinn, was able to continue regular services to the islands, the ferries it used did not correspond to the contractual terms, i.e. they were not new. The maximum fine the ministry could impose on the carrier was five million euros, which it would have claimed if ferry traffic had come to a complete standstill. Considering the breaches of contract so far, the ministry decided that an initial penalty of 400,000 euros was appropriate.  

The ministry will review the fulfillment of the contract every three months. If TS Laevad continues to use ferries that do not correspond to contractual conditions, the ministry has the right to impose further penalties of up to 100,000 euros per ship. 

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