Business sets 15 expectations for the Minister of Infrastructure of Ukraine
On May 20, the Verkhovna Rada supported the appointment of Oleksandr Kubrakov as a new Minister of Infrastructure of Ukraine. The EBA Logistics Community would like to remind about the most urgent tasks facing the Ministry on the course towards the comprehensive development of the industry.
1. Adoption of the law “On the National Commission for Transport Regulation”, as for many years, there is no state regulator in the field of transport which is contrary to the requirements of the law. At the same time, the business expects the regulator to be a fully independent and transparent body.
Sea and river transport
2. Adoption of the Procedure for Compensation of Investments in Strategic Port Infrastructure, which was developed with the participation of the EBA, USPA and the Ministry of Infrastructure.
3. Adoption of the Methodology for Calculating Port Dues Rates and Procedures for the Collection, Accounting, and Use of Port Dues Funds. The EBA community expects a reduction in port dues with the adoption of a reasonable Methodology for the calculation of port dues rates and the relevant Procedure for their collection and use.
4. Simplification of the permitting procedure for construction works in the water areas of seaports and inland waterway transport lands. For this purpose, the experts of the EBA Logistics Committee developed a draft law “On amendments to some legislative acts of Ukraine regarding construction on lands occupied by inland waterways of general use” and sent it for revision to the Ministry of Infrastructure.
5. Development of leasing and privatization in seaports as an investment attraction tool (along with concessions). Firstly, business stresses the need for a political decision to be made at the level of the Government, the Ministry of Infrastructure and the State Property Fund to start privatization processes in all domestic ports. Secondly, it is important to improve the legislation on privatization and leasing of state property, because the current regulations contain a number of deficiencies and inhibit large-scale investment in the port sector.
6. Revision of regulations to bring them in line with the Law on Inland Waterway Transport. The business community welcomes the extremely important last year’s event concerning the development of inland waterways of Ukraine – the adoption of the long-term sectoral law “On the Inland Waterway Transport”. The Ministry is now faced with an equally ambitious task – to update the regulations so they can be adopted or amended in connection with the adoption of the law before the entry into force of its basic norms.
7. Cut the List of specialized services provided in the seaport by the exclusion of pilotage and icebreaking from the List of specialized services in the seaport by natural monopolies, subject to state regulation.
8. Adoption of the Railway Transport Law. After all, the rail transport market needs long due changes to improve efficiency, promote investment in the sector development and create access to transportation by private locomotives.
9. Reform of the JSC “Ukrzaliznytsia” structure. It is necessary to reform the financial and organizational division of Ukrzaliznytsia into separate segments by type of activity by establishing in each segment (except infrastructure) of competing companies within Ukrzaliznytsia as joint-stock companies, which will create conditions for transparency, service quality and efficiency of rail transportation.
10. Address the issue of unprofitable passenger traffic and its actual cross-subsidization by freight traffic. Cross-subsidisation of passenger traffic at the expense of freight traffic is unacceptable as it negatively affects the financial condition of the railway industry and its development and, in fact, is an indirect additional financial burden on business representatives to cover losses of Ukrzaliznytsia.
11. Address the issue of land taxation by Ukrzaliznytsia. The tax on railway transport land should be abolished, as this tax burden creates an economically unjustified underestimation of the profitability of railway transport activities, together with a rise in the cost of transportation and the need to increase tariffs, negatively impacting the business community.
12. Increased liability for the dismantling of cars. A draft law to amend the Criminal Code has already been drafted by the Ministry of Infrastructure of Ukraine with the participation of experts from the Logistics Committee, and business is waiting for its adoption.
13. Address the issue of Ukrzaliznytsia reimbursement of excise tax paid on the purchase of fuels and lubricants. Ukrzaliznytsia uses the fuel purchased to operate diesel locomotives that do not travel on roads. It would therefore be logical to compensate the carrier for these funds and use them for the maintenance and development of railways.
14. Introduction of private traction market. Attracting private capital to improve the efficiency of Ukrzaliznytsia’s limited locomotive fleet.
15. Regulation of the problematic situation with the number of road transport permits for the transit through Poland. In recent years, Ukrainian carriers have been constantly faced with a critical shortage of road transport permits for international transportation. To comprehensively resolve the situation, the business proposed to negotiate with the EU to achieve the complete abolition of the need to obtain permits for vehicles of categories “Euro-5” and “Euro-6” for the carriage of goods from Ukraine to the EU.
The European Business Association wishes Mr. Kubrakov the drive and success in his new position. We hope that the renewed team of the Ministry will be able to implement most of these tasks and ensure the development of the infrastructure industry! At the same time, the business community thanks former Minister Vladyslav Kryklii for dialogue with business, willingness to cooperate, and initiated changes in the field, for example, the adoption of the Law on Inland Water Transport, and more.
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