Ilyashev & Partners Proved the Illegal Nature of Claims Filed by Ukrainian Sea Ports Authority for Termination of Servitude Agreements for the Berths of Mykolaiv Sea Port
The team of Ilyashev & Partners Law Firm has successfully defended the interests of Danube Shipping and Stevedoring Company LLC in a dispute with the State Enterprise Ukrainian Sea Ports Authority (hereinafter referred to as USPA) over the use of berth and berthing infrastructure of Mykolaiv Sea Port on the basis of the servitude agreement.
The dispute actually arose in connection with the supplement introduced by the Resolution of the Cabinet of Ministers of Ukraine No. 483 dated 07.07.2015 to the List of Specialized Services Provided in the Sea Ports by the Subjects of Natural Monopolies with a new specialized service for the port operator’s access to the berth. The tariffs for specialized service, approved by the Government and the Order of the Ministry of Infrastructure of Ukraine No. 541 dated 18.12.2015, were supposed to increase USPA revenues by 7-10 times as compared to the revenues received from the servitude agreements.
By the end of 2015, at the request of USPA, most port operators switched from the servitude agreements to a specialized service. However, the Danube Shipping and Stevedoring Company refused to terminate the existing servitude agreement and sign unfavorable special service agreements. To this end, back in 2016, the USPA initiated several lawsuits demanding termination of the servitude agreement, as well as inducement to amend the agreement in terms of servitude fee increase. Based on the results of a 2-year review, the courts of three instances dismissed all claims filed by USPA as groundless.
In August 2019, USPA received a recommendatory explanation from the Antimonopoly Committee of Ukraine, which concluded that the use of berths under the servitude agreement “may lead to a violation of antimonopoly legislation”, since the servitude fee is less than the cost of a specialized service. Claiming that the execution of the servitude agreement “may jeopardise the interests of the State”, the USPA filed a new claim to terminate the servitude.
By its Resolution dated 13 August 2020, the South-West Economic Court of Appeal has again confirmed the USPA’s claims to be groundless and unproven. Upholding the decision issued earlier by the first instance court, the court concluded that the port has no right to claim termination of the servitude agreement referring to changes in the government regulation and procedure for payment of tariffs for the port services.
Ilyashev & Partners Law Firm advised and represented the interests of Danube Shipping and Stevedoring Company LLC since 2015 at all stages: from correspondence with the governmental authorities to court proceedings. The project was supervised by Senior Partner Roman Marchenko and Partner Oleksandr Fefelov and carried out by Attorney at Law and Counsel Andrii Konoplia; Attorneys at Law Sergey Nedelko and Oleksandr Denysenko; Lawyers Oleksiy Gorbatyuk and Yevheniia Makarenko.
Founded in 1997, Ilyashev & Partners is one of the most prominent law firms in the Eastern European region. Today, Ilyashev & Partners employs more than 120 people in Ukraine, Russia and Estonia with its offices and representatives in Kyiv, Moscow, Tallinn, Dnipro, Simferopol, Odesa and Kharkiv. The firm has been recognized by the most prestigious legal market research guides, according to which it occupies a leading position in the markets of Ukraine, Russia and Estonia.