The draft federal law On Amending Article 22 of the Federal Law On Concession Agreements and Federal Law On Motorways and Road Activities in the Russian Federation and On Amending Certain Legislative Acts of the Russian Federation was submitted by the Ministry of Transport. The document is part of the effort to attract investment in toll-way construction.
The draft law stipulates amendments to Article 22 of Federal Law No 115-FZ of July 21, 2005On Concession Agreements, hereinafter referred to as Federal Law No 115-FZ of July 21, 2005, and Articles 38 and 40 of Federal Law No 257-FZ of November 8, 2007 On Motorways and Road Activity in the Russian Federation and On Amending Certain Legislative Acts of the Russian Federation, hereinafter referred to as Federal Law No 257-FZ of November 8, 2007. Under these amendments, the relevant concession agreement shall stipulate calculation methods and maximum tollway rates for general-purpose tollways being constructed under concession agreements.
Provisions of Federal Law No 257-FZ of November 8, 2007 states expressly that the calculation methods and maximum tollway rates for federal, regional or inter-municipal or local tollways, as well as tollway sections on motorways, shall be approved by the Government, a top regional agency of state authority and local governments. The need to differentiate the relevant methods for the calculation of tollway rates and their maximum volumes, as regards tollways, which have been constructed under concession agreements, and all other tollways, was noted during the review of the draft Government resolution.
The need for this differentiation is motivated by several reasons.
Provisions of Federal Law No 115-FZ of July 21, 2005 (Article 10) and Federal Law No 257-FZ of November 8, 2007 (Article 38) stipulate essential terms for a concession agreement. The procedure for stipulating toll-way rates for toll-ways or toll-way sections of motorways shall serve as an essential provision during the signing of a concession agreement.
The signing of the concession agreement is based on the project-funding principle. Under this principle, the public-transit tollway rates for general-purpose federal tollways and tollway sections of motorways shall be calculated in line with investment expenses for building a tollway and maintenance expenses. Consequently, specific tollway rates depend on investment-recoupment.
Under the Concession Agreement No K-1 of July 17, 2009 “On Financing, Construction, Operation and Maintenance of a New Exit Linking the Moscow Ring Road with the M-1 “Belarus” Moscow-Minsk Federal Motorway” and Concession Agreement No K-2 of July 27, 2009. “On Financing, Construction, Operation and Maintenance of a Tollway Section of the Moscow–St Petersburg Motorway (15th Km – 58th Km), average toll rates totaled 6.8 roubles as of January 1, 2012.
Under Federal Law No 257-FZ of November 8, 2007, the following motorways can serve as tollways, with due consideration for alternative routes:
· Roads built as tollways;
· Roads converted into tollways after upgrades and resurfacing;
· Roads converted into tollways after major construction improvements.
Considering the fact that available motorways that run through regions of traditional settlement of population, can be converted into tollways, it was suggested using the social element with regard to these motorways. This will make it possible to eliminate social tensions with regard to establishing a maximum toll rate amount for such motorways. The relevant rates, calculated in line with the social element for private cars using these tollways, totaled 1.5 roubles.
If used for tollways, which have been constructed under concession agreements, the relevant 1.5-rouble rates, calculated in line with the social element, will not generate enough income to allow the investor, who signed the concession agreement, to completely recoup construction and maintenance expenses. Consequently, this may create problems in attracting private investment during the construction and maintenance of a road infrastructure facility.
Maximum toll rates being stipulated by the Government under Article 40 of Federal Law No 257-FZ of November 8, 2007 shall regulate specific tollway rates/prices being stipulated by a concession agreement during the signing of concession agreements on financing, construction, operation and maintenance of tollways.
Considering the fact that toll rates rates under concession agreements, which have already been signed, considerably exceed 1.5-rouble rates per kilometre of tollway for private cars, which have been calculated in line with the social element, the approval of a maximum 1.5-rouble toll rate will make it necessary to reimburse the investor for revenue shortfalls.
In this connection, it was deemed appropriate to demarcate maximum toll rates for tollways, which have been constructed under a concession agreement, and for all other tollways.
However, the use of this differentiation runs counter to current legislation of the Russian Federation.
Considering the above points and rationale, the draft law is written to eliminate this contradiction.
It should be noted that, in order to prevent possible increases in maximum toll rates caused by the inefficient performance of a concessionaire during the fulfillment of specific obligations under a concession agreement, the document stipulates a provision, under which the relevant term of a concession agreement, as regards maximum toll rates, cannot be revised, with the exception of cases when during the term of an agreement the legislation of the Russian Federation, Russian regions and regulatory documents of local governments stipulate provisions aggravating the status of the concessionaire in such a way that he is largely deprived of benefits, which he could have reasonably expected when signing the concession agreement.
At the same time, considering the long-term nature of concession agreements, which take 25-30 years to execute, the draft law stipulates the possible indexation of maximum toll rates in accordance with the terms of the agreement.
Also, considering the social significance of motorways and the need to prevent a discriminatory approach with regard to various population groups, the draft law stipulates maximum toll rates for general-purpose federal, regional or inter-municipal and local tollways, as well as for tollway sections of general-purpose federal, regional or inter-municipal or local motorways, which have been constructed, and/or which are being resurfaced and upgraded under concession agreements. The Government, a top regional institution of state authority and local governments shall be authorised to approve these maximum toll rates. This will make it possible to combine the interests of the public and the investor during the adoption of decision to sign concession agreements with regard to a tollway or a motorway with tollway sections, as well as the subsequent operation and maintenance of the relevant transport and road infrastructure facility.
The draft law will be considered at a Government meeting.
