Lithuania needs very good reason not to allow freight transit – association

VILNIUS – Lithuania needs a very good reason to deny permission to those who want to transport goods through the country, according to the international convention on rail carriage, Edmundas Daukantas, president of Lineka, the national association of forwarders and logistics, said on Friday. 

His comment came after Lietuvos Gelezinkeliai (Lithuanian Railways, LTG) said it had received requests from three Belarusian companies for the transportation of Belaruskali potash fertilizers via Lithuania. 

"There are hardly any technical and legal possibilities to ban or deny that," Daukantas told BNS. "If the carrier is not a criminal or a company subject to sanctions and asks to provide a service on Lithuanian territory, practically, LTG can only regulate transit by prices, but it needs a very solid reason to say no."

Acco0rdingt to LTG, the three companies are Belintertrans, Belkali-Migao, and Belaruskaya Kaliynaya Kompaniya (Belarusian Potash Company, BKK), Belaruskali's export subsidiary. The latter wants to start shipments as early as January 24. 

According to Daukantas, Belintertrans is owned by the Belarusian state and is one of the country's largest freight forwarding companies.

"It [Belintertrans] will certainly be able to do this, and since it operates with the support of the state, it will definitely not have any major difficulties in transporting," the Lineka president told BNS. 

The logistics operations would most likely be handled by the parent company and a branch in the EU, for example, in Lithuania, could be used for payments, according to Daukantas. 

"Lukashenko's government has a very good habit of expropriating [hard] currency. All companies, even state-owned ones, seek to have branches in the EU to avoid pumping currency into Belarus," he said. "And to open an account in the EU, you need to open a company here."

Belintertrans Baltic CEO Arturas Gaidauskas told BNS that the Klaipeda-based company is a partner of Belintertrans.  

"We are partners with Belintertrans; we cooperate," he said, adding that he would not comment on whether his company is owned by Belintertrans. 

According to the Lithuanian Center of Registers, Belarus-registered Belintertrans holds 100 percent of shares in Belintertrans Baltic.

Belkali-Migao, which is based in Salihorsk, in Minsk Region, was founded by Belaruskali jointly with China's Migao Corporation Limited in late 2019.

The company says on its website that it planned to produce 80,000 tons of potassium nitrate and 62,000 tons of granulated nitrogen potassium fertilizers in its first year of operation for exports to the European Union, Turkey, Russia and China. It also had plans to enter North African and Latin American markets at a later stage. 

Earlier this month, LTG officially notified Belaruskali of the government's decision to terminate, as of February 1, the state-owned railway operator's contract with the Belarusian potash manufacturer on the transportation of 11 million tons of fertilizers through Lithuania per year. 

The railway group has already turned to a special governmental commission vetting deals by strategic enterprises over the new requests for Belaruskali fertilizer shipments. 

If they are not cleared by the commission, LTG will have a legal basis to reject the requests without risking to be sued by the companies.