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On 8 April, 2009, the Minister for Transport of the Russian Federation, Igor Levitin, held an extended conference devoted to discussing the draft Concept for reform of the management system for inland waterways of the Russian Federation. 

The participants in the conference included the Head of the Federal Sea and River Transport Agency (Rosmorrechflot), Alexander Davydenko, representatives of the Council of the Federation and the State Duma FC of the Russian Federation, federal executive authorities, representatives of constituent entities of the Russian Federation, and representatives of internal waterway enterprises and public organisations.  The law firm Vegas Lex was represented at the conference by its Managing PartnerAlbert Eganyan and Director of the Analytical Department Maxim Chernigovskiy.

Opening the conference, the Minister noted that, like other branches where a reform has been or is under way, internal water transport has not undergone reform for a long time.  The funding allocated from the budget is insufficient; the branch is not appealing to private business.  Moreover, the tariff system is ineffective, which makes water transport less competitive than other forms of transport.  All this is indicative of the need for reform.  According to the Minister, before the end of May, it is panned to consider this matter at a sitting of the Government of the Russian Federation.

The Head of the Federal Sea and River Transport Agency, Alexander Davydenko, supported by Albert Eganyan, Managing partner of Vegas Lex, spoke about the concept for reforming the management system for inland waterways of the Russian Federation.

The concept for reforming the management system for inland waterways of the Russian Federation sets the goals, tasks and mechanisms for implementing government policy to development the management system for internal waterways of the Russian Federation.  This basic document is called on to determine the role of the state in the sphere of regulation of the given activities at the current stage, in consideration of the principles of social responsibility of the state for providing the population and the economy with transport services.  The subject of the Concept is reform of the management system for internal waterways of the Russian Federation.  The concept is based on the need to develop the management system for internal waterways of theRussian Federation in accordance with the quantitative and qualitative characteristics of the change in the requirement of the population and the economy for carriage.

The task facing the lawyers of Vegas Lex in creating the draft Concept included elaboration of an effective organisational and legal model for Russia to implements the plans for creating the necessary conditions for maintaining the existing network of navigable waterways, safe navigation and accident-free operation of hydro-engineering facilities, as well as the plans for satisfying the solvent demand of branches of the economy and the population for internal waterway transport services in accordance with modern world standards.  The concept was developed on the basis of a study and analysis of the best foreign experience of organising inland waterway management systems. 

The experts of Vegas Lex suggested dividing administrative and economic functions involved in management of the inland waterway and river port infrastructure.  It is proposed that the administrative functions on inland waterways be assumed by the administration of river basins created on the basis of existing state basin managements.  At the same time, the economic functions of basic managements, together with the property intended for their fulfilment (in particular, the maintenance fleet, ship-repair shops and maintenance docks) would be handed over to the state unitary enterprise Russian Waterways (FGUP Rosvodput), which would also take over management of the federally owned part of the river port  infrastructure.  By means of additional commercial activities, FGUP Rosvodput would be able to increase revenues from use of state property and ensure worthy salaries for workers in the industry.

In view of the non-commercial nature of the state function of maintaining navigable hydro-engineering structures (navigable canals and locks), the latter are left in operational management by the administrations of river basins.  For the purpose of forming a competitive environment, however, contracts for construction and reconstruction of these facilities will be distributed by tender, in which private contractors will participate alongside FGUP Rosvodput.

The participants in the conference in general supported the draft Concept presented by Alexander Davydenko and Albert Eganyan.  After the discussion, it was decided to accept the draft as a whole; in consideration of proposals made at the conference, it was suggested that certain specifications be introduced into the Concept.  On 17 April, 2009, the Concept will be discussed at a sitting of the Marine Panel under the Government of the Russian Federation, chaired by Deputy Prime Minister of the Government of the Russian Federation Sergei Ivanov.

Information about the law firm Vegas Lex

Vegas Lex was founded in 1995 and, since 2000, has been one of the Top-3 leaders among Russian law firms.  According to Russian and international ratings, Vegas Lex is one of the leading legal consultants in the sphere of law making on and support for PPP and infrastructure projects.  The Firm has offices in Moscow, Volgograd, Krasnodar and a number of regional partners.  The Firm’s 11 practices include a Department for PPP and Infrastructure Projects.  Our clients are major Russian and international corporations, leaders in their market sectors.

Vegas Lex is a member of the Expert Council on PPP of the Ministry of Transport of the Russian Federation and co-operates with the Committee of the State Duma for Economic Policy and Enterprise and the Committee of the Council of the Federation for Economic Policy, Enterprise and Property (expert support for and membership of PPP working groups).  Vegas Lex experts belong to the Inter-departmental Working Group of the Council of the Federation for improvement of the PPP legislation, the Public Council under the Ministry for Regional Development of the Russian Federation and the Commission for PPP and Investments of the Russian Union of Industrialists and Entrepreneurs. 

In April 2009, Vegas Lex was awarded the Corporate Lawyer journal’s diploma for achievement in the social sphere in the category “For active participation in law making”.   It was the intention of the founders of this prestigious competition for the given category to encourage law firms that participate actively in legislative activities.  The prize in this category is awarded for expert support rendered to state authorities in drafting new bills.