Free checkpoints? At your expense!
One of the pressing problems of the Russian port industry is the situation with state border crossing checkpoints. By law, the financing of its arrangement lies within the state responsibility, but the demands placed upon such points by the state regulatory authorities overestimate the cost of expenses to such an extent that the funds easily run short. Therefore, the state wants to impose the burden of financing the objects on private business, but private companies are not willing to invest without guarantees of their return at the current high prices, requiring simplification of border procedures.
Turning over without compensation
In accordance with current legislation, the establishment, development and reconstruction of checkpoints across the state border of Russia, as well as its maintenance should be financed through the federal budget. But in practice, the state lacks enough funds for these purposes because of excessive demands made by control authorities to the border crossing points. It turns out a vicious circle, where the government can not fulfill its obligations due to the requirements of its own agencies who are not directly interested in optimization of these requirements. As a result, private businesses operating at seaports become fall guys, who have to suffer from this confusion.
As a result, this gave rise to proposals to restore through legislation the possibility of private participation in financing the checkpoints. If we talk about sea border crossing points, in fact it deals with a stevedoring business. As Elena Kitova, the chief of Rosgranitsa’s Department of state policy for the development of the state border Rosgranitsa said in an interview with PortNews "we believe that it is expedient to attract private business, because the market participants are directly interested in the functioning of the points”.
In this regard, we note that, according to the bill "On the border crossing points of the Russian Federation", the construction, equipping and reconstruction of such checkpoints can be carried out at the expense of private investors on a competitive basis, with subsequent transfer to the state without compensation, while maintenance of checkpoints is allowed only at the expense of budget funds. As by the project developers explained, to avoid the influence of investors on the work of regulatory bodies.
At the same time, Rosgranitsa is developing a Concept of the Federal Target Program (FTP) "State Border of the Russian Federation (2012-2017)" to be introduced in November 2010 to the Russian government. If it is approved the FTP Concept should be prepared by summer next year. It is assumed that the Federal program will include the financing of the reconstruction of border crossing points in 60 Russian ports. As the federal border service said under the Federal Law "On State Border of the Russian Federation’ the federal program concerns only federal funds, allocated for arrangement and equipping the border crossing points. But the implementation procedure of the FTP allows changes. Therefore, if the regulation of public-private partnership is adopted in the framework of the law of the checkpoints, this will give an opportunity to reconsider the schedule and volume of work and allocated federal funds.
Turning over without compensation
In accordance with current legislation, the establishment, development and reconstruction of checkpoints across the state border of Russia, as well as its maintenance should be financed through the federal budget. But in practice, the state lacks enough funds for these purposes because of excessive demands made by control authorities to the border crossing points. It turns out a vicious circle, where the government can not fulfill its obligations due to the requirements of its own agencies who are not directly interested in optimization of these requirements. As a result, private businesses operating at seaports become fall guys, who have to suffer from this confusion.
As a result, this gave rise to proposals to restore through legislation the possibility of private participation in financing the checkpoints. If we talk about sea border crossing points, in fact it deals with a stevedoring business. As Elena Kitova, the chief of Rosgranitsa’s Department of state policy for the development of the state border Rosgranitsa said in an interview with PortNews "we believe that it is expedient to attract private business, because the market participants are directly interested in the functioning of the points”.
In this regard, we note that, according to the bill "On the border crossing points of the Russian Federation", the construction, equipping and reconstruction of such checkpoints can be carried out at the expense of private investors on a competitive basis, with subsequent transfer to the state without compensation, while maintenance of checkpoints is allowed only at the expense of budget funds. As by the project developers explained, to avoid the influence of investors on the work of regulatory bodies.
At the same time, Rosgranitsa is developing a Concept of the Federal Target Program (FTP) "State Border of the Russian Federation (2012-2017)" to be introduced in November 2010 to the Russian government. If it is approved the FTP Concept should be prepared by summer next year. It is assumed that the Federal program will include the financing of the reconstruction of border crossing points in 60 Russian ports. As the federal border service said under the Federal Law "On State Border of the Russian Federation’ the federal program concerns only federal funds, allocated for arrangement and equipping the border crossing points. But the implementation procedure of the FTP allows changes. Therefore, if the regulation of public-private partnership is adopted in the framework of the law of the checkpoints, this will give an opportunity to reconsider the schedule and volume of work and allocated federal funds.
Law is tough, stevedores stance is tougher
Nevertheless, the stevedoring companies remain skeptical about the idea of fulfilling the government obligations at their expense. As Dmitri Morozov chairman of the Committee on investment programs for development of port infrastructure and operating issues of the Association of Commercial Sea Ports of Russia (ASOP) commented in an interview with PortNews, the stevedores would be willing to finance the construction, development and reconstruction of sea border crossing points, but only on a reimbursable basis, not free as the bill’s current version provides for.
"The existing text of the bill says about gratuitous assignment of the checkpoint facilities constructed on private funds to the state. However, this directly contradicts the law of the state border. For the investor, in fact, performs the obligations of the Russian Federation and, therefore, we expect a 100-percent reimbursement of its costs", says Dmitry Morozov.
According to him, the decision problem lies in formulating a reasonable specification for the design of checkpoints, particularly in the ports, where there is probably no need for building at each terminal a full-function checkpoint.
"Optimization of requirements, the introduction of new technologies that are now just not necessary and profitable for customs authorities and border guards, will thus reduce the costs. In this situation, there is a need for someone who would act as a mediator between the interests of various supervisory bodies and who would have the authority to define requirements for border crossing points and decision-making in this area. Rosgranitsa might be such a referee in this case,” said Dmitry Morozov. “So we welcome the development of a bill on border crossings, which will raise the regulatory framework governing the activities of Rosgranitsa to the level of federal law."
ASOP has already made amendments to the text of the bill that would guarantee the interests of the port business community, the return of private investments, extension of Rosgranitsa authority. There are no such provisions in the proposed version of the bill.
According to Dmitry Morozov, it is possible to cut down expenses on sea checkpoints, in particular, properly joining in a harbor single crossing point the common functions and objects, to avoid meaningless duplication in each of the terminals within a port.
The head of Rosgranitsa Dmitry Bezdelov shares this point of view about the need for uniformity and simplification of border crossing formalities, as well as the formation of single full-functioning port checkpoints. "Standardization will remove a large range of issues," Mr. Bezdelov said during his speech at the II International Conference "Modern Border Management” in Moscow.
In addition, we must not forget that under the Customs Union and in the Common Economic Space, we will have to develop common approaches to border crossing points at the external borders, which will also require new coordination and harmonization of border control procedures. According to Natalia Slyusar, the Director of the Legal Department of the Secretariat of the Customs Union’s Commission who was speaking at the Conference, the Union should create something similar to the EU’s Schengen zone.
Vitaly Chernov.
Nevertheless, the stevedoring companies remain skeptical about the idea of fulfilling the government obligations at their expense. As Dmitri Morozov chairman of the Committee on investment programs for development of port infrastructure and operating issues of the Association of Commercial Sea Ports of Russia (ASOP) commented in an interview with PortNews, the stevedores would be willing to finance the construction, development and reconstruction of sea border crossing points, but only on a reimbursable basis, not free as the bill’s current version provides for.
"The existing text of the bill says about gratuitous assignment of the checkpoint facilities constructed on private funds to the state. However, this directly contradicts the law of the state border. For the investor, in fact, performs the obligations of the Russian Federation and, therefore, we expect a 100-percent reimbursement of its costs", says Dmitry Morozov.
According to him, the decision problem lies in formulating a reasonable specification for the design of checkpoints, particularly in the ports, where there is probably no need for building at each terminal a full-function checkpoint.
"Optimization of requirements, the introduction of new technologies that are now just not necessary and profitable for customs authorities and border guards, will thus reduce the costs. In this situation, there is a need for someone who would act as a mediator between the interests of various supervisory bodies and who would have the authority to define requirements for border crossing points and decision-making in this area. Rosgranitsa might be such a referee in this case,” said Dmitry Morozov. “So we welcome the development of a bill on border crossings, which will raise the regulatory framework governing the activities of Rosgranitsa to the level of federal law."
ASOP has already made amendments to the text of the bill that would guarantee the interests of the port business community, the return of private investments, extension of Rosgranitsa authority. There are no such provisions in the proposed version of the bill.
According to Dmitry Morozov, it is possible to cut down expenses on sea checkpoints, in particular, properly joining in a harbor single crossing point the common functions and objects, to avoid meaningless duplication in each of the terminals within a port.
The head of Rosgranitsa Dmitry Bezdelov shares this point of view about the need for uniformity and simplification of border crossing formalities, as well as the formation of single full-functioning port checkpoints. "Standardization will remove a large range of issues," Mr. Bezdelov said during his speech at the II International Conference "Modern Border Management” in Moscow.
In addition, we must not forget that under the Customs Union and in the Common Economic Space, we will have to develop common approaches to border crossing points at the external borders, which will also require new coordination and harmonization of border control procedures. According to Natalia Slyusar, the Director of the Legal Department of the Secretariat of the Customs Union’s Commission who was speaking at the Conference, the Union should create something similar to the EU’s Schengen zone.
Vitaly Chernov.