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Liniya Prava Advises on Concession Agreement for Creation of Tram Network in St. Petersburg

Liniya Prava Advises on Concession Agreement for Creation of Tram Network in St. Petersburg

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Liniya Prava has provided legal counsel to LLC Transport Concession Company (“TCC”) on the concession agreement it entered into on May 30th with the Government of St. Petersburg for the creation and reconstruction of a tramway network in the Krasnogvardeiskiy district of St. Petersburg. The CJSC Leader pension fund asset management company is the financial arranger of the concession.

The LLC Transportation Concession Company, a consortium established by the LSR Group and the Management Company Leader, was the only participant of the concession tender. The expected duration of the concession agreement is 30 years. The works are planned to be finished by mid-2018. The concessionary’s investment in the project will exceed RUB 8.9 billion (at 2015 prices). At the investment stage St. Petersburg will ensure financing in the amount of RUB 1.33 billion.

The project is expected to include the construction of new tramway tracks in all the major streets of the Krasnogvardeiskiy district up to the Ladozhskiy train station, as well as the building of a tramway depot for servicing and layover of the rolling stock and the creation of platforms designed for facilitating quick entrance and exits by passengers on the trains.

According to Liniya Prava, the legal support it provided included "counseling TCC at the preparation stage for participation in the tender procedures, drafting propositions relating to concession agreement terms, and support of tender procedures."

"This is the first project in Russia involving the construction of an all-inclusive transportation system in an entire district," commented Sergey Okutin, the Head of TCC. "We are going to carry out a complete reconstruction and raise the quality of public transportation services for those who live in the Krasnogvardeiskiy district. The tramway tracks will be made using a new noiseless technology and the trams will be able to accommodate more passengers. Overall, we expect to seriously improve transport accessibility of the Ladozhskiy train station and decrease the burden of other means of transportation."

Liniya Prava Managing Partner Andrey Novakovskiy commented on the signing of the concession agreement: "This project can very well be described as innovative. For the first time in Russia a concession tender has been held in the area of urban above-ground electrical transportation which will lead to the creation of district tramway communication in a city of federal importance. We are glad to play a part in development of the St. Petersburg transportation system."

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