FAS discussed the basic parameters of the new tariffs of “Russian Railways”

On 5 April 2017, the Sub-Group of the Federal Antimonopoly Service (FAS Russia) discussed operational costs subject to including in the tariffs, fees and charges for railway freight as part of the measures on establishing new rates of “Russian Railways” OJSC. Participants, comprising the largest consignors, rolling stock operators and expert economists from the leading research institutes looked into the pressing issues that must be solved to create a new tariff system of the infrastructure monopoly.

The welcoming remarks were given by Deputy Head of FAS Alexander Red’ko. He invited the experts to, first of all, determine the base costs encorporated in the future tariffs. Deputy Head of FAS emphasized “Russian Railways” should not transport cargo at the price not covering the marginal costs of the monopoly. At the same time, the existing costs “Russian Railways” must be transferred into the new tariff rates after their optimizing.

Experts were asked to discuss several issues, the questions to which can help formulate the future characteristics of the tariff system. Such characteristics include: defining the level of marginal costs of “Russian Railways”; transition to the pulling force estimation model, separating the costs by centers of financial responsibility and norm setting; developing a model for automated changing of the cargo tariff class in case of fluctuating world prices, etc.

Following the meeting outcome, “Russian Railways” is requested to devise an economic costs model that will form the tariff basis; other participants were asked to submit their proposals on the above items.