A government decision aimed at bringing the charter of the Ukrainian Railways public joint-stock company (Ukrzaliznytsia) in line with the law "On the Particulars of Creation of a Public Joint-Stock Railway Company" has transferred control of Ukrzaliznytsia directly to the Cabinet of Ministers of Ukraine. This move is aimed at improving the efficiency of management of the railway company, and it is expected to strengthen the role of Ukrzaliznytsia’s supervisory board.
The Ministry of Infrastructure’s State Secretary Andrii Haluschak announced this, the Interfax Ukraine news agency reports.
"From now on, the government, as the shareholder of the company, will be able to quickly make effective decisions that are necessary for the functioning of the company and reforms," he said.
According to him, the changes that were made to Ukrzaliznytsia’s charter will strengthen the role of the company’s supervisory board as a management body headed by First Deputy Minister of Infrastructure Yevhen Kravtsov.
"The Ministry of Infrastructure will focus on its core function of formulating state policy on rail transport without being distracted by resolution of administrative issues," Haluschak said.
The changes to the charter of Ukrzaliznytsia were made at a government meeting on 18 January. According to the Economic Pravda publication, Minister of Economic Development/Deputy Prime Minister Stepan Kubiv proposed the changes. Kubiv submitted the relevant government resolution at the request of Prime Minister Volodymyr Groysman.
Deputy Infrastructure Minister Dmytro Romenskyi confirmed to the CFTS portal that members of the Cabinet of Ministers voted to make the appropriate changes to the charter of Ukrzaliznytsia.
Ukrzaliznytsia’s Board Chairman Wojciech Balczun welcomed has the changes. "We welcome any steps aimed at improving the efficiency of the company’s operations… The board of the company will consistently implement the reform strategy formulated by the government, which is the shareholder,” Balczun said.
Article 13 of the previous version of Ukrzaliznytsia’s charter stipulated that “the company’s operations are to be guided by the Constitution and laws of Ukraine, acts of the president of Ukraine and the Cabinet of Ministers, orders of the Ministry of Infrastructure, other legal acts, and the company’s current charter and internal documents adopted in accordance with the current charter."
The phrase “orders of the Ministry of Infrastructure” is excluded from the new version of the company’s charter.
In addition, under the previous charter, the company’s shareholder (the Cabinet of Ministers) had the right to transfer certain powers to manage the state’s corporate rights in Ukrzaliznytsia to the Ministry of Infrastructure. The new version of the charter strips the Ministry of Infrastructure of this right.
Currently, the highest organ of Ukrzaliznytsia is the general meeting of its shareholders. The Cabinet of Ministers performs the functions of the general meeting of shareholders.
The Ministry of Infrastructure has also been stripped of the right to determine the direction of Ukrzaliznytsia’s operations, influence the number of the company’s shares, and approve its financial plans, annual reports, and number of employees.
Now, decisions on these issues are to be made in accordance with the relevant act of the Cabinet of Ministers, a draft of which is to be prepared and submitted in accordance with procedures established by the Ministry of Economic Development (rather than the Ministry of Infrastructure).
