Business opposes the introduction of differentiated coefficients to railway tariffs in the direction of ports

08/ 07/ 2025

The European Business Association is concerned about the intention of JSC “Ukrzaliznytsia” to introduce differentiated mark-up coefficients for calculating freight tariffs in the direction of specific seaports. The business community views this initiative as unfounded and potentially harmful to Ukrainian exporters and the broader economy. According to member companies of the ЕВА’s Logistics Committee, implementing such an initiative: Contradicts the principles of equal access to infrastructure and risks violating antitrust legislation. Applying different tariffs for transport routes to particular ports effectively interferes with the formation of transportation costs and is inconsistent with current legislation. Firstly, the Law of Ukraine “On Natural Monopolies” stipulates that tariff-setting must be based on economically justified expenses, depreciation, taxes, asset values, profitability, distance to the consumer, product quality, and government support. Therefore, tariffs should be formed using transparent and objective criteria, not solely on the direction of transport. Secondly, under the Railway Transport Statute of Ukraine, freight service users are cargo shippers, not seaports. As such, tariff policy should be grounded in equal access for all shippers rather than administrative efforts to level the playing field between ports. Moreover, the current Freight Tariff Guide already accounts for distance-based rate differentiation. Thus, the remoteness of consumers is already factored into tariff calculations. May slow down the transport sector’s European integration. As part of the EU integration process, Ukraine has committed to aligning its transport policy with EU standards. According to Directive 2012/34/EU on a single European railway area, tariffs must be transparent, economically justified, and non-discriminatory. Selective increases without sufficient justification or market consultation deviate from these principles. Will reduce the competitiveness of Ukrainian exports, especially in the agricultural sector. Amid war conditions, export-oriented companies across key economic sectors are already facing high logistics costs. In such circumstances, increased tariffs on routes to the busiest ports could further undermine exports, leading to: Higher production costs for Ukrainian goods abroad, Reduced competitiveness of Ukraine as an exporter, Lower foreign currency earnings, Decreased profitability in various industries and reduced tax revenues. In the long term, this may cause a shift to road transport, reducing freight volumes and revenues for the railway operator itself. These concerns are amplified by recent decisions to alter tariff distances to the ports of Odesa and Chornomorsk. Currently, trains are being redirected via longer routes, which has already raised railway transport costs and the final price of exported goods. EBA experts stress that support for river or underutilised ports should be achieved through targeted subsidies, investment, or infrastructure development – not by increasing tariffs for exporters. The business community does not support any form of tariff regulation that contradicts the principles of economic competition. The ЕВА insists on maintaining tariffs that are transparent, fair, economically grounded, and reflective of actual costs. Moreover, business calls for continued state oversight of tariff formation to prevent conflicts of interest. The European Business Association hopes for the implementation of a transparent and predictable tariff policy that aligns with national interests and supports the sustainable development of rail transport.

According to member companies of the ЕВА’s Logistics Committee, implementing such an initiative:

Contradicts the principles of equal access to infrastructure and risks violating antitrust legislation.

Applying different tariffs for transport routes to particular ports effectively interferes with the formation of transportation costs and is inconsistent with current legislation.

Firstly, the Law of Ukraine “On Natural Monopolies” stipulates that tariff-setting must be based on economically justified expenses, depreciation, taxes, asset values, profitability, distance to the consumer, product quality, and government support. Therefore, tariffs should be formed using transparent and objective criteria, not solely on the direction of transport.

Secondly, under the Railway Transport Statute of Ukraine, freight service users are cargo shippers, not seaports. As such, tariff policy should be grounded in equal access for all shippers rather than administrative efforts to “level the playing field” between ports.

Moreover, the current Freight Tariff Guide already accounts for distance-based rate differentiation. Thus, the remoteness of consumers is already factored into tariff calculations.

May slow down the transport sector’s European integration.

As part of the EU integration process, Ukraine has committed to aligning its transport policy with EU standards. According to Directive 2012/34/EU on a single European railway area, tariffs must be transparent, economically justified, and non-discriminatory. Selective increases without sufficient justification or market consultation deviate from these principles.

Will reduce the competitiveness of Ukrainian exports, especially in the agricultural sector.

Amid war conditions, export-oriented companies across key economic sectors are already facing high logistics costs. In such circumstances, increased tariffs on routes to the busiest ports could further undermine exports, leading to:

Higher production costs for Ukrainian goods abroad,
Reduced competitiveness of Ukraine as an exporter,
Lower foreign currency earnings,
Decreased profitability in various industries and reduced tax revenues.

In the long term, this may cause a shift to road transport, reducing freight volumes and revenues for the railway operator itself.

These concerns are amplified by recent decisions to alter tariff distances to the ports of Odesa and Chornomorsk. Currently, trains are being redirected via longer routes, which has already raised railway transport costs and the final price of exported goods.

EBA experts stress that support for river or underutilised ports should be achieved through targeted subsidies, investment, or infrastructure development – not by increasing tariffs for exporters.

The business community does not support any form of tariff regulation that contradicts the principles of economic competition. The ЕВА insists on maintaining tariffs that are transparent, fair, economically grounded, and reflective of actual costs. Moreover, business calls for continued state oversight of tariff formation to prevent conflicts of interest.

The European Business Association hopes for the implementation of a transparent and predictable tariff policy that aligns with national interests and supports the sustainable development of rail transport.