Serbia Changes Railway Law to Allow Competition and Curb Losses

Serbia adopted a new railways law to enable competition and attract investment in the services dominated by the state-run and unprofitable Zeleznice Srbije.

The changes open the market for passenger and cargo services for which the Belgrade-based Directorate for Railways will issue licenses and security certificates, according to the document, passed in the capital Belgrade today. The directorate will set rates for using the railway infrastructure, which will be managed by a public company and local authorities.

The government also plans to split Zeleznice into units that will handle infrastructure, transportation and asset management, as part of efforts to adapt Serbia’s legislation to the European Union. The Balkan nation expects to get a date next month for starting entry talks with the bloc.

Serbia aims to curb spending on state companies including Zeleznice. The monopoly gets 14.6 billion-dinar ($170 million) support from the budget this year, after posting a 16.5 billion-dinar loss in 2012. The government said the new law will improve efficiency and help integrate Serbia’s rail network with neighbors and with the EU.

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