The government has updated the Law of Ukraine "On Railroad Transport," the Information-Analytical Bulletin of the Cabinet of Ministers of Ukraine informs.

The document focuses on the key issues of industry which is run by the State Administration of Railroad Transport (Ukrzaliznitsia). First of all, the issues are related to the progressing aging and depreciation of fixed assets, the lack of an effective mechanism for involving private capital and low level of competition on the railroad transportation market in Ukraine.

The bill is based on the so-called "model" law initiated in the European Union, as well as on the world's best practices, including know-how of the Russian Federation and Germany.

The main innovations of the Law are introduction of a modern target model of the railroad transportation service market, definition of infrastructure of railroad transport and introduction of effective mechanisms to attract private capital to management of the state transportation monopoly.

It also implies introduction of new tariff regulation principles on railroad transport and utilization of modern, efficient logistics models for managing of passenger and cargo traffic.

In addition, according to the bill, the state tariff policy will be formed solely on the basis of cost-based tariffs. The updated Law has a clause stating that establishing regulated tariffs below the economically justified level without identifying the sources of compensation shall be prohibited and may be appealed in court.

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