Russian Railways preparing to break off agreement with Armenia
20.09.2019,
17:16
The state-owned Russian Railways (RZD) is preparing to break off the agreement with Armenia, claiming that its authorities are blocking the operation of its subsidiary South Caucasus Railway (SCR), which operates the Armenian railways.
YEREVAN, September 20. /ARKA/. The state-owned Russian Railways (RZD) is preparing to break off the agreement with Armenia, claiming that its authorities are blocking the operation of its subsidiary South Caucasus Railway (SCR), which operates the Armenian railways, RTVI said citing its source familiar with the status of negotiations between Russia and Armenia.
The information was confirmed by Russia's Ministry of Transport. The SCR press service did not comment on this report.
Relations between Russian Railways and the Armenian authorities escalated after Armenian law-enforcement authorities started a criminal case against SCR, accusing it of abuses and misappropriations. In December 2018, Armenia's Investigative Committee launched a criminal case against a former Deputy Minister of Transport for hiding a long string of abuses identified by an audit of the South Caucasus Railway.
In late 20018 December, the Investigative Committee said it was investigating SCR’s activities for the last 10 years to verify if it indeed had invested $226.8 million in the development of the facility. The company responded by saying that the investigation was “biased”.
According to a RTVI source, a total of seven cases were brought against SCR by Armenian authorities, which were combined into one. According to the source, if Armenia didn’t want to put pressure on Russia, but to figure out the situation, it would appeal to an international court.
“The agreement provides, for example, for appealing to the arbitration court in Paris to resolve disputes, but instead the Armenian side preferred pressure on the company,” the source said.
The Russian Ministry of Transport negotiated with Deputy Prime Minister of Armenia Mher Grigoryan to find a solution to the problem. Particularly, Moscow offered to close the criminal case in return for new investments. Russia also suggested conducting a new independent audit if the Armenian authorities were not ready to simply withdraw their claims.
“The dialogue did not produce any results, so Moscow is considering a way out of the agreement with Armenia,” a RTVI source said.
The Russian Railways did not confirm this information. On September 18 First Deputy CEO of Russian Railways Alexander Misharin was in Yerevan and SCR employees that working in Armenia is important for the company, and emphasized that SCR is one of the largest employers in Armenia having more than three thousand people on its payrolls.
South Caucasus Railway CJSC is a 100% subsidiary of Russian Railways OJSC. Armenian railway infrastructure was placed under concession management of SCR CJSC in accordance with the Concession Agreement signed on February 13, 2008. The concession management period is 30 years with the right to extend it for another 10 years. -0-
The information was confirmed by Russia's Ministry of Transport. The SCR press service did not comment on this report.
Relations between Russian Railways and the Armenian authorities escalated after Armenian law-enforcement authorities started a criminal case against SCR, accusing it of abuses and misappropriations. In December 2018, Armenia's Investigative Committee launched a criminal case against a former Deputy Minister of Transport for hiding a long string of abuses identified by an audit of the South Caucasus Railway.
In late 20018 December, the Investigative Committee said it was investigating SCR’s activities for the last 10 years to verify if it indeed had invested $226.8 million in the development of the facility. The company responded by saying that the investigation was “biased”.
According to a RTVI source, a total of seven cases were brought against SCR by Armenian authorities, which were combined into one. According to the source, if Armenia didn’t want to put pressure on Russia, but to figure out the situation, it would appeal to an international court.
“The agreement provides, for example, for appealing to the arbitration court in Paris to resolve disputes, but instead the Armenian side preferred pressure on the company,” the source said.
The Russian Ministry of Transport negotiated with Deputy Prime Minister of Armenia Mher Grigoryan to find a solution to the problem. Particularly, Moscow offered to close the criminal case in return for new investments. Russia also suggested conducting a new independent audit if the Armenian authorities were not ready to simply withdraw their claims.
“The dialogue did not produce any results, so Moscow is considering a way out of the agreement with Armenia,” a RTVI source said.
The Russian Railways did not confirm this information. On September 18 First Deputy CEO of Russian Railways Alexander Misharin was in Yerevan and SCR employees that working in Armenia is important for the company, and emphasized that SCR is one of the largest employers in Armenia having more than three thousand people on its payrolls.
On September 16, Prime Minister Nikol Pashinyan said that audits of SCR are being carried out to protect the interests of the country, and added that active negotiations with Russian partners were underway.
