The European Commission has fined the state-owned Lithuanian Railways €28mn for hindering competition on the rail freight market, the EU executive announced on October 2.

In 2008, Lithuanian Railways dismantled a 19km track that had provided convenient rail access to neighbouring Latvia. Polish-owned refiner Orlen Lietuva used the line to haul its product to Latvian ports, using another rail operator. Following the track removal, however, the Polish company faced using a much longer route to Latvia and in effect redirected transports to the Lithuanian port of Klaipeda.

The Polish company also disputed Lithuanian Railways’ pricing of access to its infrastructure in a long-running dispute that at some point became a high-level flashpoint between the two countries and was only settled in June.

“Lithuanian Railways used its control over the national rail infrastructure to penalise competitors in the rail transport sector,” Competition Policy Commissioner Margrethe Vestager said in a statement.

“It is unacceptable and unprecedented that a company dismantles a public rail infrastructure to protect itself from competition,” Vestager added.

Lithuanian Railways said it would examine the commission’s decision in detail before deciding on how to proceed. The company appears to be sticking to its guns, however, saying the dismantling of the line to Latvia was due to the line’s poor condition and did not affect the flow of goods between Lithuania and Latvia.

In late September, the Latvian foreign ministry issued a note to Lithuania demanding that the line be rebuilt, the Latvian newswire Leta reported on October 2.