Government reorganizes Moldovan Railway: new joint-stock company created for passenger and freight transport

The Government of the Republic of Moldova approved at today’s meeting a decision on reorganizing the State Enterprise Moldovan Railway by division and establishing a new entity – the Joint-Stock Company Passenger and Freight Moldova Railway. The new company will be fully state-owned and will take over passenger and freight railway transport activities.

The decision was taken under the legislation on the management of public property and the organization of state enterprises, with the aim of restructuring the railway sector and clearly separating economic activities of public interest.

According to the decision, the Public Property Agency (APP) will exercise, on behalf of the state, the role of sole shareholder of the new joint-stock company. CFM ‘Passenger and Freight’ will be the legal successor of the State Enterprise Moldova Railway, within the limits of the assets established by the distribution balance sheet.

“Fixed and current assets used for passenger and freight railway transport will be transferred to the new company. At the same time, the allocation of rights and obligations, including debts and pledged assets resulting from re-crediting contracts concluded with the Ministry of Finance, will be carried out on the basis of the transfer act and the distribution balance sheet, in compliance with the Civil Code and the contracts in force. The share capital of CFM ‘Passenger and Freight’ will be formed from the assets transferred from the State Enterprise Moldova Railway, and the transfer of assets will be carried out in accordance with the Regulation on the transfer of public property,” the document reads.

The new company will take over all rights and obligations arising from the individual and collective labor contracts of the transferred employees. In situations where the transfer of staff will not be possible, layoffs will be carried out strictly in accordance with labor legislation.

The expenses related to the reorganization process will be borne by the State Enterprise Moldova Railway, which is undergoing reorganization.

The Public Property Agency also has a period of six months from the date of entry into force of the decision to approve the division project and the distribution balance sheet; approve the statute of the new joint-stock company and amend accordingly the statute of the State Enterprise Moldova Railway; appoint the interim director of CFM ‘Passenger and Freight’ until the definitive management is designated.

At the same time, the Ministry of Infrastructure and Regional Development will identify the railway infrastructure elements necessary for drafting the multiannual infrastructure management contract.

After the reorganization, the State Enterprise Moldova Railway will continue to carry out activities of public interest, with its main responsibility being the management of railway infrastructure, in accordance with the Railway Transport Code.

The government decision enters into force upon the publication in the Official Journal of the Republic of Moldova.