EU – Baltic States, Legislation, Lithuania, Port, Transport

"The port companies of Klaipeda were eagerly looking at the future prospects and bravely designed and carried out various investments' programs. Since 2004, the port companies have invested LTL 3.2 billion (EUR 0.9 billion) into the port's objects. When the guarantees on their first right to re-rent the land are over, the companies will be reluctant to invest into the port," – considered Lithuanian Stevedoring Companies Association Legal Committee Chairwoman Aldona Staponkiene.

Klaipeda port has a different activity plan compared to other EU ports. Private companies emerged in the port of Klaipeda when public companies were privatized. Although the land was rented to them by the government, they felt at home and invested into the port. In many EU ports, the port companies are only the users of the ports' facilities. Such companies come to the ports, where everything is created for them, including embankments and cranes. Similar situation to this of Klaipeda may exist in other post-Soviet countries. Thus, the EU's attempt to transfer its laws to the experience of these countries might simply not work, writes LETA/ELTA.

Lithuanian Civil Code contains a provision that after the land lease term, the tenant, if he/she paid regularly for the lease, has the first right to a contract extension. In the future, the port's land will be exceptional because it functions under the umbrella of the EU laws. "The port companies will be discriminated and the principle of justice will be breached," – claimed the representatives of port companies.

Under the EU law, any EU entity is able to rent the land in the port of Klaipeda. The arrivals from Stavropol will not be able to rent the land in the port of Klaipeda. However, the EU arrivals from Switzerland, Malta or Cyprus will be able to do that. These are the countries having the biggest amount of Russian investment.

Western European countries have liberal laws on land rent changes for quite a long time. Western Shipyard Manager Arnoldas Sileika noted that Europe has a lot of family companies renting the land for 2-3 centuries. This means that the rules governing land rent are somehow circumvent. Klaipeda port calls to look at the new economic tendencies of the EU with a caution. Lithuania has the only port and its loss could result into a serious economic damage.

The port companies of Klaipeda even went so far as to state that the EU provisions on the land rates in the port should not be applied in Lithuania. More specifically, this new law should be applied only for the newcomers. Today, the port of Klaipeda does not have a lot of vacant land. The new land would appear only if a new deep-water port is built. Liberal procedures for land lease are provided in the EU directives. Lithuania cannot categorically disagree with the EU directives. Upon entering the EU, Lithuania has agreed with is legal regulatory standards and committed to harmonize its laws with the existing EU laws.

"We cannot claim that we are not going to keep up with the land lease provisions. Such statement would equal to leaving EU. If the EU Court of Justice started procedures against Lithuania, the port would immediately lose all of the EU support. The biggest possible sanction could be a requirement to payback all the EU funds invested in the port so-far," – noted Klaipeda State Sea Port Authority Director Eugenijus Gentvilas.

The initiator of these land lease procedures is an Estonian EU Commissioner for Transport Siim Kallas, the former Estonian Minister for Finances. His initiative is also unwelcome in Estonia, where the situation is similar to that of Klaipeda.

"We cannot reject the new EU regulations on ports' land lease. We need to think about by-laws, port land lease tender conditions, also about compensations for those companies, which built terminals in those areas," – considered the Ministry of Transport, Water Transport Department Manager Jelena Antonevic.

Many questions arise today. First of all, in what kind of shape, the users need to return terminals? Are they going to be compensated? "According to the existing situation, the land has to be returned "naked". The situation is absurd, a step back for any port. We have to follow the EU law, but we should not do it blindly. What works for Spain or Italy, may not do for Belgium, Estonia or Lithuania. They should pay attention to the specificities of each country; otherwise, the ports will be on the verge of crash," – considered Klaipeda Stevedoring Company (KLASCO) Managing Director Audrius Pauza.