Russian Federation Government Relations

Relations with the Federal Executive Authorities of the Russian Federation for the 12 months of 2022

In 2022, FPC interacted with state authorities in four main areas:

  • Receiving compensation for the Company’s shortfall in income from the regulation of long-distance passenger fares for 2020 and allocating additional subsidies for 2022;
  • Indexing fares for long-distance passenger service on public railways in third-class open sleeping carriages and fourth-class seating carriages;
  • Reimbursing the costs of transporting refugees from the Donetsk People’s Republic and the Luhansk People’s Republic by JSC FPC;
  • Financing the FPC Investment Programme.

On 29 December 2022, FPC was granted RUB 5.9 billion from the Reserve Fund of the Russian Government to fully compensate the Company for losses in revenue from passenger transportation in third-class open sleeping carriages and fourth-class seating carriages for 2022 (Decree of the Russian Government No. 4183-r dated 24 December 2022).

The relevant ministries and agencies supported the proposals of FPC on the additional indexation of passenger fares from 1 October 2022 (by 6.52%) and from 1 January 2023 (by 8.1%) in order to partially compensate for the lack of carriages, as well as the funds allocated to ensure transport security. The respective decisions were given effect by FAS of Russia’s Orders No. 676/22 dated 23 September 2022 and No. 798/22 dated 11 November 2022.

FPC’s own financial sources for the investment programme were reduced as a result of a decline in passenger-distance brought on by the emergence of a new coronavirus epidemic in 2020.

At the beginning of 2022, FPC had RUB 3.1 billion of its own funds to finance the purchase of carriages.

After Decree No. 602 of the Government of the Russian Federation dated 6 April 2022 came into force, the authorised capital of the Parent Company increased by RUB 250 billion. From this amount, RUB 25.33 billion were allocated to increase the authorised capital of JSC FPC. These funds, along with the Company’s own resources, allowed the investment programme to be fully implemented in 2022, resulting into the purchase of 433 carriages. In addition, first steps were taken to secure financing for FPC’s 2023 Investment Programme: 550 carriages are to be purchased for a total of RUB 40.3 billion