EU Commission Closes Riga Infringement Case

Latvian tugboat company JSC PKL Flote failed to prove its claim before the European Commission in the infringement procedure against Latvia on the violation of the Treaty on the Functioning of the European Union with regard to providing tugboat services at the Freeport of Riga.

“Thus, the JSC “PKL Flote” failed to obtain the dominant position and the opportunity to raise the tug service charge and increase its profit,“the port commented.

In 2011, the European Commission received a complaint from the JSC “PKL Flote” in which it was claimed, that the company was prevented from providing tugboat services at Freeport of Riga.

The complaint was lodged with the objective to make the Freeport of Riga Authority terminate providing of the tugboat services, the port said.

“This would have strengthened the dominant position of the JSC “PKL Flote” on the towage market at Freeport of Riga, and due to potential use of the company’s market power, a twofold increase of the towage fee at the Freeport of Riga might be possible,”the port added.

According to the port, the price hike would have been detrimental to the competitiveness of the Freeport of Riga as a transit cargo transshipment center.

On the basis of the JSC “PKL Flote” complaint, the European Commission began investigating this case, because according to the information provided by the JSC “PKL Flote”, Latvian authorities failed to correctly apply the provisions of Article 49 of the Treaty on the Functioning of the European Union (TFEU) on freedom of establishment.

In July 2011 and in May 2012 the Latvian authorities provided explanations to the EC on providing tugboat services at the Freeport, rejecting the allegations in regards of restrictions on freedom of establishment.

The EU Commission closed the infringement case on February 26, 2015.