All wagons of Freight One, its subsidiary, to be unloaded, sent outside Ukraine – Ukrzaliznytsia head

All gondola cars belonging to Russian railway operator OJSC Freight One and its subsidiary Freight One LLC in Ukraine, companies which Ukraine recently imposed sanctions on, will be unloaded and sent outside Ukraine.

Head of the State Railway Administration of Ukraine (Ukrzaliznytsia) Oleksandr Zavhorodniy said in Kyiv on Thursday that as of September 23, the two companies had 3,676 gondola cars, some of them with cargo and some vacant, in Ukraine.

"It was decided that all the cars are unloaded and sent outside Ukraine and they will not be passed to the territory of the country in the future," he said.

Zavhorodniy said that this situation will not affect cargo flow, as this concerns only two companies. When asked about transit, he said, in his own words, that nature abhors vacuums.

"Another company on which sanctions are not imposed would appear and carry transit cargo," he said.

As reported, a decree of Ukrainian President Petro Poroshenko on the introduction of sanctions against companies and citizens of Russia, including these two companies, was made public last week.

The decree includes travel restrictions on the company's wagons on the territory of Ukraine (the share of Kyiv's Freight One of the Freight One's consolidated goods turnover is around 2.5% of the market) and it does not foresee detention, arrest or nationalization of the assets of these two companies.

Freight One is Russia's largest rail freight operator. Besides Russia and Ukraine, the operator works in Kazakhstan and has a joint venture with Finnish railways. Freight One is part of UCL Rail, the rail division of Vladimir Lisin's Universal Cargo Logistics Holding (UCL Holding). UCL Rail owns about 200,000 freight cars of different types, most of which are gondola cars. Besides railway assets, it includes stevedoring companies in the northwest and south of Russia, and large Russian shipping companies.