Lithuania’s state-owned railway company LTG has asked law enforcement to investigate a possible violation of international sanctions, suspecting that luxury cars exported to non-EU countries may be ending up in Russia.
According to a press release from LTG Cargo, LTG’s freight arm, its experts responsible for sanctions supervision became suspicious about possible schemes to circumvent restrictions on luxury cars shipped to Russia.
On Tuesday, LTG Cargo contacted law enforcement following an internal investigation.
The company claims that it has already suspended the transportation of suspicious shipments and has forwarded the investigation material it has gathered to the Prosecutor General’s Office.
“We have informed our customers that LTG Cargo is suspending the transport of all luxury cars by rail through the territory of Lithuania due to the unacceptable risk posed by businesses seeking to circumvent sanctions,” the press release quoted Eglė Šimė, CEO of LTG Cargo.
The Lithuanian railway company believes that luxury cars destined for so-called third countries outside the EU – Belarus, Kazakhstan, Kyrgyzstan, Uzbekistan, Tajikistan, Georgia, and Turkmenistan – are in fact being transported to Russia.
An internal investigation by LTG Cargo into 447 shipments involving Mercedes, Porsche Cayenne, Cadillac and other luxury cars transported by nine customers revealed that 75 of them were registered in Russia, 55 entered Russia through other countries and no data was found on the place of registration of the remaining cars.
Four companies were found to be involved in a possible sanctions circumvention scheme.
According to Šimė, suspected sanctions circumvention schemes are monitored continuously.
“Every day, we work with a team of experts to prevent every attempt to circumvent the existing sanctions and to trace possible schemes to circumvent the restrictions. We cooperate with the relevant authorities and take all the steps we can to prevent unauthorised cargo from reaching Russia,” she said.
Re-export of luxury cars suspended from December
Later on Tuesday, LTG Cargo said it was suspending re-exports of luxury cars via Lithuania to third countries from December 1. Moreover, they will be subject to enhanced checks in November.
“The applications for November shipments were submitted and approved last month. Customers who submitted their applications in November and whose shipments will meet the requirements of the enhanced controls and who can prove beyond doubt that they comply with the sanctions will be allowed to transport these goods, provided that the shipments are completed by December 1,” the company told BNS.
LTG earlier explained it would reject all applications for shipping cars valued at more than 50,000 euros and produced in the last five years to countries outside the EU.
LTG Group’s Corporate Affairs Director Aleksandras Zubriakovas said that existing international sanctions may have been violated through the falsification of declarations.
“The essence of this scheme is the submission of a false declaration where the car seller, the company, provides false information about the final destination, which is not difficult to check by the car’s VIN code,” Zubriakovas told BNS on Tuesday.
Re-exports of luxury cars to countries like Kazakhstan and Kyrgyzstan, he said, increased in 2022 after the European Union imposed sanctions on Russia in response to its attack on Ukraine. This year, LTG’s tighter cargo checks have led to a slight drop in the flow of such cargo.
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