Construction, Latvia, Legislation, Lithuania, Port

“A search was conducted yesterday, but there cannot be any objective reason for it. There is no information about the details, except that the local institution had received a request from Lithuania,” Afanasejva said, adding that BMGS is operating in several countries in compliance with the laws of each particular country and the European Union, as well as business ethics.

Commenting on the situation, Afanasjeva said that when it applied for participation in a tender to reconstruct embankments at the Lithuanian Port of Klaipeda, BMGS picked a partner with whom a consortium was established in order to meet the client’s qualification requirements. “All bids are being made on in the name of the consortium. The other member of the consortium is Lithuanian company Hidrostatyba, which is not our rival,” the BMGS CEO explained.

As reported, officers from the Klaipeda department of the Lithuanian Special Investigation Service raided a Lithuanian construction firm on Tuesday as part of an international pre-trial investigation into suspected public procurement fraud.

The Special Investigation Service said that it was investigating the case in collaboration with the Latvian Corruption Prevention Bureau (KNAB) whose employees searched the home and office of a Latvian construction company’s CEO, a woman identified a S.A. The Latvian company, just like the Lithuanian firm, is involved in construction and renovation projects.

The law enforcement authorities suspect the above companies of entering an illegal agreement on terms for participation in public tenders. It is thought that by coordinating their actions the two companies won a contract whose value was increased by more than EUR 3 mln.

In March 2017, Lithuanian builder Hidrostatyba and Latvia’s BMGS won a EUR 14.837 mln tender to reconstruct the embankments used by Vakaru Laivu Gamykla (Western Shipyard, or VLG), a Lithuanian shipbuilding and repairing group controlled by Estonia's BLRT Grupp.

According to information from Firmas.lv, BMGS, established in 1993, closed 2015 with EUR 56.711 mln in turnover, down 43% from a year before. The company’s 2015 profit grew 2%

y-o-y to EUR 1.042 mln. Financial results for 2016 are not yet available.