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LITHUANIA
Ratola offers a full tyre service centre
Ratola invested in new equipment from Akar Makina during the good times
Ratola Stands Against All Odds
The fight against the environmentalists
However, the state of the country’s transportation service network is not the only issue Ratola now has to cope with. As explained by Vasiulis, in 2016 the company received a request from the country’s governmental agencies for protection of the environment, who suddenly demanded that the company should double payments of the utilisation fee. In terms of the environment- protection legislation Lithuania is very similar to other countries of the European Union, and in particular it is requesting that the importer should pay fee for production or import of tyres. However, the environmentalists last year discovered some gap in the legislation, which says that tyre manufacturers should pay the fee for any “newly created product”, without specifying what it actually means.
In the opinion of the governmental agencies this
point means that retreaders should not only pay a utilisation fee for all casings imported into Lithuania, as they actually did over many years, but also for the tyres retreaded on these casings, because this is newly created product. Shortly after receiving the request Ratola took the environmental agencies to the country’s commercial disputes court, but primarily due to the lack of the resources, lost the case, so the government as the result introduced the duel taxation on the retreading industry starting from last year. Moreover, the environmentalists not only obligated Ratola to start paying the utilisation fee based on the new scheme, but also demanded that the company paid the “delinquent taxes” over the previous years adding it with late payment charges, Vasiulis stated. Obviously, this situation brought huge losses to the company and led to the situation whereby the taxation of the retreading industr y in
One of the Lithuanian truck tyre retreaders, Klaipeda-based Ratola, has probably faced all possible challenges over the past few years, associated not only with common industry problems like the distress coming from Chinese tyres and the effect of Russia’s sanctions on the local transport business, but also with some unique things, like unreasonable pressure from environmentalists, the company’s director Vaidas Vasiulis stated.
In Klaipeda Ratola remains the only truck tyre retreader, but it is hard to say, whether this is an advantage or not. The city is located on the cost of the Baltic Sea and for centuries was one of the most important trade hubs in the region connecting Western and Central Europe with the Russian Empire, in past decades also serving as a major transit point for cargoes flowing from Asia. For two decades from the country’s independence Lithuanian transport companies have been operating here, unloading giant commercial vessels coming to the city from all over the world, with Russia often the final destination. However, it seems that those days are gone, because this part of the city’s sea port’s business was heavily affected by the “sanction war” between Russia and the Western countries, which started back in 2014, when the first restrictive
measures were put in place. These things coincided with the commissioning of the Ust-Luga commercial port near St. Petersburg, which became a major competitor to Klaipeda for serving cargo flows coming to Russia via the Baltic Sea. Although, the cargo turnover in Klaipeda was growing in general, reaching the historic height of nearly 40 million metric tonnes in 2016, this figure is mostly accounted for
by oil, mineral fertilisers and liquid gas – all those things that are not transported in trucks. At the same time, the transit of food to Russia was blocked within the so-called food embargo, while the deliveries of ever ything else, fit for transportation in trucks, shrunk due to the fall in the value of the Russian Ruble against hard currencies.
All in all, these issues forced transport companies to leave the region, searching for some opportunities In the west, which in turn reduced the demand for tyres in Klaipeda. The problem is quite usual, not only in particular for Lithuania, but in general for the Baltic region, and although there is no certain statistical information, market participants believe that most trucks have emigrated from the countr y over the past few years and ver y few are still coming back to the countr y to change tyres.
38 Retreading Business