The legislation of the Finnish railway sector has changed considerably in recent years as a result of the EU railway packages. The European Union's desire to promote competition in rail transport resulted in Finland opening national goods transportation to competition at the beginning of 2007. The culmination of the law reform was the entry into force of the Railway Act (304/2011) on April 15 2011.

Under the act, a company that wishes to provide domestic goods transport services on the Finnish rail network must:

  • first apply for a safety certificate from the Finnish Transport Safety Agency (TraFi);
  • apply for a licence from the Ministry of Transport and Communications;
  • apply for rail capacity from the Finnish Transport Agency; and
  • conclude an access contract with the Finnish Transport Agency in order to use the services of the state rail network.

Despite efforts to encourage competition, Finland has remained one of the few EU countries where the goods transport network was operated by a single railway company – in this case, state-owned monopoly VR Group.

However, the countdown finally started in 2011 when TraFi issued the first safety certificates to private companies Proxion Train Oy and Ratarahti Oy.

Proxion Train was presumably the first company to enter into a contract for carriage of goods on the Finnish railways. It has concluded a contract with Vapo Timber to carry lumber from Vapo Timber mills from September 2013.

On May 15 2012 the Ministry of Transport and Communications issued a licence to Ratarahti, making it the first new official operator in Finland since the sector was opened to competition. Initially, Ratarahti will concentrate on timber transportation between a limited number of locations starting in Autumn 2012.

For many years, heavy-goods transport by rail declined as the structure of Finland's core industries changed. However, the Finnish mining industry, which has now largely been taken over by foreign companies, has been growing at record speed and now offers inviting possibilities to new private railway companies.

The Finnish Transport Agency will try to ensure that the use of the railway network is fair and efficient when the new players start their operations. The agency periodically publishes network statements, which provide information on services, access conditions and the capacity process. The current network statement is for the period from December 11 2011 to December 8 2012. The agency has also put into operation a railway capacity management system, called LIIKE, through which capacity applications can be made.

For further information on this topic please contact Matti Komonen or Herman Ljungberg at Hammarström Puhakka Partners, Attorneys Ltd by telephone (+358 9 474 2207), fax (+358 9 474 2247) or email ([email protected] or [email protected]).