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The first decision was confirmed.
According to the Lithuanian Court of Appeal, the panel of judges of the Civil Cases Division on April 27. by 2020 Vilnius Regional Court decision unchanged. November 16 a decision declaring illegal and canceling the year 2020 of the Public Procurement Office May 20 the conclusion of the evaluation, which obliges the municipal administration of the city of Vilnius and the Ministry of Education, Science and Sports to end the award procedures for the concession of the ongoing project “Multifunctional complex of health, education, education, culture and employment” (National Stadium).
“After examining the case, the panel of judges concluded that the contested VPT assessment conclusion was reasonably overturned as it does not comply with the provisions of Article 8 of the Public Administration Law of the Republic of Lithuania , which requires that the public entities of the administration not to violate the legal acts; the content of the decisions meets the requirements of legal regulations.
After examining the case, the panel of judges concluded that the contested conclusion of the VPT’s evaluation was reasonably overturned.
The panel of judges found that VPT did not properly apply the relevant legal norms for the evaluation of the legality of the concession, did not carry out a comprehensive analysis of the legal relationships of the concession project, therefore it did not adequately evaluate the legal facts (qualification) “Says the court report.
However, this does not mean that VPT cannot adopt another evaluation conclusion that meets the requirements of legal standards, it is at the discretion of the service.
Photo by Julius Kalinskas / 15min / National Stadium
Promises in three years
After the court announces its decision, Mayor Remigijus Šimašius will hold a short press conference.
“I am very happy that the way has been opened for the construction of a multifunctional center together with the national stadium. It turns out that we were right from the beginning, it is a pity that we lost two years in legal disputes, but we won the courts of first and second instance.
I would like to welcome two reasons: firstly, that a national stadium and a whole multifunctional center can appear in Vilnius, when necessary to stimulate the economy. This is a very good period, I believe that the Government will live up to its responsibilities and the agreements that have been made will be implemented. We will discuss this with the Government in the near future.
The second reason I am happy is for the whole of Lithuania, for Vilnius, because the VPT has sued us in court and tried to reform the jurisprudence and all legal practice on public-private partnerships. “I am very happy that the court has heard our arguments, which means that the public-private partnership will be able to function more smoothly and will not get bogged down in bureaucratic clutter,” said the mayor.
This aspect, according to the mayor, is especially important considering the decrease in EU money, as well as the decrease in other funds after the pandemic, so more objectives will be carried out through public-private partnerships. This court decision seems to offer many opportunities.
“In three years, we will invite them to the stadium if the government does not deviate,” said the mayor.
Dealers take the position that all agreements are valid.
VPN chief Darius Vedrick told BNS that the service is currently examining the court’s motives and will issue a report shortly. He has not yet been able to say whether the decision will be appealed to the Supreme Court.
On its website, VPT states: “VPT recalls that the evaluation concluded that such a project financing model could not be considered as a concession contract. A concession contract defines a public-private partnership in which, in exchange for an investment in public infrastructure, a private entity (concessionaire) is granted the right to carry out a commercial activity and receive remuneration for it. It is important to note that it is the private entity (concessionaire) that assumes the risk of return on investment.
According to the VPT, in the case of said project, the concessionaire would not have such a risk, since the public sector would pay the construction costs of the Multifunctional Complex, covering the credit and interests of the project company. Therefore, in VPT’s opinion, this form of association is not in line with the merits of the concession and cannot be applied in a specific case.
The VPT undertakes to make a decision on further actions after examining the decision and the arguments of the Lithuanian Court of Appeal.
The government, according to R. Šimašius, had suspended all work until the court decision, so it is now expected to resume talks and finish resolving some issues. It’s supposed to take months.
“We are ready to sign the contract tomorrow. The government has some problems, but I think we will solve them,” he said.
Photo by Lukas Balandi / 15min / Reimgijus Šimašius
The mayor says he is not afraid that the VPN may still take any action to reevaluate the concession, but he hopes the story will not continue. Darius Vedrick, the current leader, was supposed to make a decision on the second day of the appeal in December, but now the VPN is deepening and “it will no longer be in trouble.”
No government interference is expected, but separate precise negotiations have not yet taken place, pending a court ruling. So they promise to speak as soon as the Government and the Prime Minister can.
“Private partner, dealers take the position that all agreements are valid. We will still sit down and talk to VPT, because our goal is not to litigate with VPT, our goal is to work; in this case, a multifunctional center with a national stadium is at the forefront of work that both Vilnius and non-Vilnius residents are looking forward to, ”said R. Šimašius.
Axis Industries will not change its plans for the construction of the multifunctional center; the company is ready to sign the contract and start work: “We have all the capabilities and we are ready to sign the contract and start construction if the Vilnius city municipality decides to do so then.”
VPN application denied
Last December, the VPT rejected the Vilnius Municipality’s offer to reach an amicable settlement and appealed to the Court of Appeal against the Vilnius Regional Court ruling, which declared the VPT’s order to end the national competition illegal. of stadiums.
At the end of February, the Court of Appeals reopened the procedure on the merits.
In May last year, the Municipality of Vilnius received a letter from the VPN pledging to rescind the LTL 156 million. Tender in euros for the construction and concession of the National Stadium.
Previously, in March, the VPN did not allow the signing of the concession contract: the signature was suspended at the request of the Financial Crimes Investigation Service (FNTT) and the Attorney General’s Office. Law enforcement sought to determine whether the increase in the value of the concession after negotiations was reasonable and legal.
And in May, the VPN announced that the concession contract had to separate state and municipal risks, but the change in the financing model of the project left them with all the risks, so the foreseen contracts with Axis Industries cannot be considered. a concession contract.
Won Axis Industries
Axis Industries, an Icor company, won the tender to build a multifunctional center, and the Vilnius city municipality planned to sign a contract with it and the financier of the BaltCap project last March. This was supported by both the municipal council and the government.
Complex with 15 thousand. construction of the stadium and other facilities should cost around 93 million. However, the payments over 25 years would have paid almost € 156 million to the BaltCap Fund. euros.
The government’s share, according to the draft contract, would have been about $ 54.5 million. 101.5 million euros, municipalities. euros.
In addition to the stadium, it is planned to build an athletics stadium, a sports complex with gymnastics, handball, volleyball, boxing, basketball courts, a community and cultural educational center with a library, a 300-seat kindergarten and a sports museum.
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