The Lithuanian government decided on Wednesday that the state-owned railway company must terminate its contract with Belarus' potash giant Belaruskali, because it clashes with national security interests.
Back in December, a special governmental commission vetting deals by strategic enterprises also ruled that the contract between Belaruskali and Lithuanian Railways (Lietuvos Geležinkeliai, LTG) was not in line with the country's national security concerns.
“As of February 1, it [the contract] is no longer valid,” Transport Minister Marius Skuodis said after the cabinet's meeting on Wednesday.
Fertiliser shipments under the contract must stop by that date, because the government’s decision leaves no legal basis for them to continue, Skuodis added.
If other companies want to transport Belaruskali fertilisers through Lithuania, their deals with the Belarusian company will also be subject to government scrutiny, he added.
The minister described Wednesday's decision as the first step toward stopping the transit of Belaruskali fertilisers via Lithuania.
The contract was signed by LTG and Belaruskali in the spring of 2018 and was to remain in effect until the end of 2023.
It provides for the transport of about 11 million tons of Belarusian fertilisers via Lithuania to the seaport of Klaipėda annually.
Belaruskali product shipments via Lithuania did not stop after the US sanctions came into force on December 8, because the Belarusian company had made an advance payment to LTG, sufficient to cover the cost of rail services for several months.
LTG ‘too dependent’ on Belarusian company
MP Laurynas Kasčiūnas, chair of the parliamentary National Security and Defence Committee (NSGK) criticised LTG, saying the state-owned railway company is too dependent on Belaruskali.
“Some of LTG's action algorithms seemed to show that the company at that time was too dependent on this contract,” Kasčiūnas told reporters on Wednesday after a joint meeting of the NSGK and the Economy Committee.
“Certain steps were made, not so much to avoid sanctions, but to delay them a little. Here we are talking about the advance payments,” he added.
Kasčiūnas said that “it is worth raising the question of how much a state-owned company should be dependent on a country like Belarus”.
“Such contracts were supposed to bring profits, but there is also national security to consider,” he said.
The conservative MP noted that LTG's contract with Belaruskali had never been vetted by a special governmental commission for national security concerns.
“The company itself did not feel legally obliged to have it cleared” by the commission, he said.
LTG's acting CEO Egidijus Lazauskas, who took part in the meeting, said that lawyers hired by the company had recommended against referring the contract to the commission.
Kasčiūnas rejected the opposition's call to set up a special commission to further investigate Lithuania's failure to stop the transit of Belarusian fertilisers despite the US sanctions on Belaruskali.
“Parliamentary control is sufficient,” he said.
However, NSGK members from opposition parties insist on the need for a special inquiry.
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