EU – Baltic States, Financial Services, Funds, Latvia, Legislation, Railways, Transport

He said that the EC has sent a positive assessment about Latvia's proposals, but also sent additional questions, which the Transport Ministry and the Finance Ministry will now work on.

As reported, on October 23, the government decided to give the Transport Ministry and the Finance Ministry mandates to begin discussion with the European Commission on redistributing Cohesion funds from the failed train procurement for other purposes. The Transport Ministry believes that these funds must primarily be distributed to improve rail infrastructure, as well as maintaining roads, that lead to rail infrastructure objects.

At the beginning of October Latvia's passenger train operator Pasazieru vilciens and Spain's train manufacturer Construcciones y Auxiliares de Ferrocariles S.A. (CAF) failed to reach an agreement on the procurement of new trains.

Pasazieru vilciens announced the train procurement in December 2009. In March 2011, the European Commission confirmed that LVL 100 million would be provided from the European Union's Cohesion Fund for the project. Under the failed contract, the total cost of new 34 electric trains and seven diesel trains that Pasazieru vilciens wanted to buy was LVL 144, of which LVL 100 million would have been covered from the bloc's Cohesion funds, whereas Pasazieru vilciens co-financing would be LVL 44 million.