VAS “Latvijas dzelzceļš” meitassabiedrība AS “LatRailNet” has raised the railway infrastructure fee for Russian-origin grain cargo transit by only 24%, falling significantly short of the 300% increase urged by the Latvian government. While the state sought the triple tariff hike to halt aggressor-state grain transit through the country, the infrastructure manager cited economic and legal limitations.
Government Response and Ministerial Directives on Transit Restrictions
Prime Minister Andris Kulbergs criticized the decision during a government session, stating that the enterprise is failing to execute mandates issued by both the Cabinet of Ministers and the Saeima. Kulbergs noted that while “LatRailNet” claimed to have initiated coordination with European Union institutions regarding a 300% tariff hike on October 1, the delayed action remains unacceptable. He questioned what the company had been doing since September 15.
In response to the stalled tariff policy, the Prime Minister has tasked specific government ministers with drafting alternative regulatory measures. Satiksmes ministrs Rihards Kozlovskis must prepare a draft bill regarding the potential liquidation of “LatRailNet” and the transfer of its functions to the SPRK. The proposal must ensure continuity in fee setting and compliance with EU requirements. Kozlovskis is also directed to examine Poland’s approach to restricting Russian grain transit by separating transit and import conditions. This assessment must determine if and how such an approach can be legally applied in Latvia.
Ārlietu ministre Baiba Braže must submit a proposal for a transit ban based on Estonia’s approach within a week, alongside an assessment of its impact on budget revenues. Braže and Tieslietu ministrs Edvards Smiltēns are tasked with preparing a national sanctions package to ban Russian and Belarusian grain transit while ensuring compliance with EU law. This package will include an evaluation of financial impacts. Meanwhile, Zemkopības ministrs Uldis Augulis is scheduled to report on grain sampling progress and cooperation with Ukraine.
Legislative Changes and Timeline for Railway Infrastructure Fees
The Saeima adopted amendments to the Railway Law on September 17 under an urgency procedure to accelerate the review and implementation of infrastructure charges for Russian grain transit. These legislative changes allow the notification period for fee adjustments to shrink from two months to two weeks, requiring the infrastructure manager to review and decide on applicable tariffs within one week. The regulation applies to transit cargo where the shipping station is in Russia and will remain in effect until December 31, 2026.
Despite these accelerated legal tools, explanatory notes accompanying the legislation highlight risks of reduced cargo volumes, potential international litigation, and disputes regarding EU transport policy alignment. Kulbergs stated that these litigation risks must be evaluated in monetary terms, with answers expected by next week.
Latvian government evaluates Estonia grain transit ban
Concurrently, the Latvian government is evaluating Estonia’s recent decision to ban Russian and Belarusian grain transit. Kulbergs described the Estonian move as an important measure for joint Baltic security policy. While Estonian authorities noted that Russian grain transit through their country has been nearly nonexistent, the measure functions primarily as a preventive safeguard against new export routes.
Frequently Asked Questions About the Grain Transit Dispute
Why did “LatRailNet” increase the fee by 24% instead of 300%?
“LatRailNet” pointed to legal and economic constraints when evaluating the government’s proposal, ultimately adopting a fee increase aligned with its interpretation of current regulations before beginning EU-level coordination on October 1.
What legal changes did the Saeima enact regarding the railway fees?
The Saeima adopted urgent amendments to the Railway Law on September 17, shortening the fee publication timeframe from two months to two weeks and requiring a decision within one week for shipments originating in Russia.
What is the status of cargo sampling at the border?
The Food and Veterinary Service has received authorization to take samples from transit grain loads and perform laboratory checks to verify the declared country of origin. Latvia intends to limit Russian grain transit while maintaining the ability to support the export of Ukrainian and Latvian farmers’ products through Latvian ports.
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