State ownership , also called public ownership or government ownership , is the ownership of an industry , asset , property , or enterprise by the national government of a country or state , or a public body representing a community, as opposed to an individual or private party . Public ownership specifically refers to industries selling goods and services to consumers and differs from public goods and government services financed out of a government's general budget . Public ownership can take place at the national , regional , local , or municipal levels of government; or can refer to non-governmental public ownership vested in autonomous public enterprises . Public ownership is one of the three major forms of property ownership, differentiated from private, collective / cooperative , and common ownership .
60-418: Russian Railways (Russian: ОАО «Российские железные дороги» (ОАО «РЖД») , romanized: OAO Rossiyskie zheleznye dorogi (OAO RZhD) ) is a Russian fully state-owned vertically integrated railway company , both managing infrastructure and operating freight and passenger train services. The company was established on 18 September 2003, when a decree was passed to separate the upkeep and operation of
120-415: A government owning all or a controlling stake of the company's shares . This form is often referred to as a state-owned enterprise . A state-owned enterprise might variously operate as a not-for-profit corporation , as it may not be required to generate a profit; as a commercial enterprise in competitive sectors; or as a natural monopoly . Governments may also use the profitable entities they own to support
180-612: A meeting of the Russian Academy of Science, Vladimir Yakunin presented an ambitious new transport route called the Trans-Eurasian Belt Development (TEPR) which would go "through Russia with a mega road and high-speed rail network to link Asia with Europe' and with the opportunity to go to Chukotka and Bering Strait and then to the American continent" to Alaska, "making overland trips from Britain to
240-465: A new corporate style which changed fundamentally the way the Company presented itself visually to the outside world. The change of corporate identity underwent several stages during the 2007–2010 period. The final version of the logo was designed by BBDO Branding. Also, commissioned by BBDO Branding The Agency HardCase Design created a family of corporate fonts RussianRail, consisting of 15 fonts. In
300-605: A program to introduce new high-speed trains. The first train, Sapsan , commenced service in December 2009 and connects Saint Petersburg , Moscow and Nizhny Novgorod and is operated with trains manufactured by the German company Siemens. The second train, Allegro , has run from Saint Petersburg to Helsinki via Vyborg since December 2010 and is owned and operated together with the Finnish VR Group . Sapsan
360-423: A specific state institution or branch of government, used exclusively by that branch, such as a research laboratory. The latter refers to assets and resources owned by the population of a state which are mostly available to the entire public for use, such as a public park (see public space ). In neoclassical economic theory , the desirability of state ownership has been studied using contract theory . According to
420-542: A speed of up to 250 km/h (155 mph). They are derived from the German ICE 3 train but with bodies widened by 330 mm (13.0 in) to 3,265 mm (10 ft 8.5 in) to suit Russia's wide loading gauge . Four of the trains (EVS2) are equipped for both 3 kV DC and 25 kV 50 Hz AC operation. The total length of each ten-car train is 250 m (820 ft 3 in), carrying up to 600 passengers. Development and construction
480-406: A whole. As such, state ownership is only one possible expression of public ownership, which itself is one variation of the broader concept of social ownership. In the context of socialism, public ownership implies that the surplus product generated by publicly owned assets accrues to all of society in the form of a social dividend , as opposed to a distinct class of private capital owners. There
540-463: Is Oleg Belozerov. Before him, the position was occupied by Kirill Androsov from September 2011 till June 2015, and previously by Alexander Zhukov – from 20 July 2004 to September 2011 and Viktor Khristenko – from 16 October 2003 – 20 July 2004. Gennady Fadeev was President of JSC Russian Railways from 23 September 2003 – 14 June 2005. He was succeeded by Vladimir Yakunin – from 14 June 2005 to 20 August 2015. Oleg Belozyorov has been president of
600-682: Is a Russian gauge high speed electric express train. The train is a Siemens Velaro model, which in turn is based on the ICE 3 M/F high-speed trains manufactured by Siemens for the German Deutsche Bahn (DB), known as the Siemens Velaro . The trains started regular service on the Saint Petersburg–Moscow Railway in December 2009 at a maximum speed of 250 km/h (155 mph). On 22 March 2022, following
660-550: Is a natural monopoly or because the government is promoting economic development and industrialization . State-owned enterprises may or may not be expected to operate in a broadly commercial manner and may or may not have monopolies in their areas of activity. The transformation of public entities and government agencies into government-owned corporations is sometimes a precursor to privatization . State capitalist economies are capitalist market economies that have high degrees of government-owned businesses. Public ownership of
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#1732791601270720-416: Is a process of transferring private or municipal assets to a central government or state entity. Municipalization is the process of transferring private or state assets to a municipal government. A state-owned enterprise is a commercial enterprise owned by a government entity in a capitalist market or mixed economy . Reasons for state ownership of commercial enterprises are that the enterprise in question
780-416: Is a wide variety of organizational forms for state-run industry, ranging from specialized technocratic management to direct workers' self-management . In traditional conceptions of non-market socialism, public ownership is a tool to consolidate the means of production as a precursor to the establishment of economic planning for the allocation of resources between organizations, as required by government or by
840-477: Is also part of the program. Between 2021 and 2025 RZD plans to build Rostov–Krasnodar–Adler, Tula–Voronezh high-speed rail and the extension of Kazan-Yelabuga high-speed rail, as well as other regional high-speed rail links. During the 2026–2030 third phase of the program, Russian Railways will build Moscow–Saint Petersburg high-speed rail section; the railway line will be extended from Yelabuga to Yekaterinburg, and from Voronezh to Rostov-on-Don. In March 2015, at
900-646: Is considered the first step to triggering a credit default swap . In December 2023 the joint venture with the VR Group , Finnish Railways, to run the Karelian Trains ceased, the trains having stopped running in March 2022 following the Russian invasion of Ukraine and Russian Railways having failed to meet their portion of the financing obligations, VR Group assumed the whole financial obligations and took over
960-563: Is desirable. In their model, the government and a private firm can invest to improve the quality of a public good and to reduce its production costs. It turns out that private ownership results in strong incentives to reduce costs, but it may also lead to poor quality. Hence, depending on the available investment technologies, there are situations in which state ownership is better. The Hart-Shleifer-Vishny theory has been extended in many directions. For instance, some authors have also considered mixed forms of private ownership and state ownership. In
1020-686: Is determined by the Federal Tariff Service at net cost or higher. Limited railway capacity is the main factor limiting Russian coal exports to Asia. Demand for Russian coal in Europe has declined due to the energy transition and Russia's invasion of Ukraine and this reinforces the need for Russia to reorient coal exports to Asia. Russian Railways has a near-monopoly on long-distance train travel, with its subsidiary, Federal Passenger Company, accounting for 90% of total passenger turnover in 2017. Passenger transportation accounted for 10.6% of
1080-454: Is divided into two components: «ticket» (which includes the cost of transport infrastructure, locomotive traction and the Station component) and «reserved seat» (service of transport company, which is the owner of the car). Since 2003, the flexible schedule tariffs (FST) to travel on long-distance trains is used: FST is calculated in such a way as to stimulate passengers to undertake a trip on
1140-606: Is the founder and sole shareholder of JSC Russian Railways. On behalf of its shareholders the powers are exercised by the Government of the Russian Federation . It approves the president of the company, forms the board of directors annually and approves the annual reports. An IPO for the company was considered in 2012, but it was pushed back to after 2020. The Chairman of the Board of Directors of JSC Russian Railways
1200-524: The 2022 Russian invasion of Ukraine , Siemens suspended its contract to supply additional trainsets, as well as announcing it would end maintenance and other services from 13 May 2022, with Russian Railways stepping in to continue their maintenance. On 18 May 2006, Siemens and Russian Railways signed a €276 million order for eight high-speed trains with a 30-year service contract worth around €300 million. The trains were ordered to connect Moscow with Saint Petersburg and later Nizhny Novgorod at
1260-533: The Nizhny Novgorod route on 30 July 2010. Sapsan set records for the fastest train in Russia on 2 May 2009, travelling at 281 km/h (175 mph) and on 7 May 2009, travelling at 290 km/h (180 mph). On 19 December 2011, a €600 million order for an additional twenty trainsets including eight EVS2 sets was signed in order to facilitate an increased number of services on existing lines and
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#17327916012701320-423: The means of production is a subset of social ownership , which is the defining characteristic of a socialist economy. However, state ownership and nationalization by themselves are not socialist, as they can exist under a wide variety of different political and economic systems for a variety of different reasons. State ownership by itself does not imply social ownership where income rights belong to society as
1380-454: The 1990s to 934,000 people in 2012. In 2012, it became one of the three largest transport companies in the world. According to a Reuters inquiry, RZD procurement activities in 2012 amounted to $ 22.5 billion; part of this was awarded to private contractors with no genuine operations in de facto noncompetitive tenders. Some of the company addresses listed on the tenders turned out to be private apartments, car repair shops or department stores. It
1440-582: The 2046 that had formed the MR system. Gennady Fadeyev, the Railways Minister, became the company's first president. The reform saw the creation of a new market segment following the privatization of the network's rolling stock. The company divided the bulk of its wagon fleet between two new operating companies, Freight One (which was later privatised) and Freight Two (renamed Federal Freight in 2012), and private players such as GlobalTrans also entering
1500-524: The 32 regions of the former Soviet Railways (SZD). In the mid-1990s, the profitability of railway transportation of the Russian Ministry of Railways fell to negative values, the bureaucratization of the ministry itself was publicly criticized, which became an occasion for reforms. Shortly after being elected president of Russia in 2000, Vladimir Putin approved the idea of reforming the railway transport, according to which all economic functions on
1560-735: The Federal Railway Transport Agency (FRTA) and Russian Railways (RZD). The reform also required RZD to provide access to railway infrastructure to other carriers and operators. As the law requires carriers to provide service to customers anywhere in Russia, RZD retained its dominant position. Later in 2003, the Decree No. 585 established RZD as a joint stock company, making it a holding in charge of 63 subsidiaries, including TransContainer , RailTranAuto, Rail Passenger Directorate, Russian Troika, TransGroup, and Refservis. RZD acquired 987 companies (95% in asset value) out of
1620-676: The French logistics company Gefco SA. The total value of the transaction was 800 million euros, the seller being PSA Peugeot Citroen , the parent company of Gefco. A program to modernize the Baikal–Amur Mainline was launched in 2013, costing the equivalent of £4 billion by 2018. In 2015, RZD International won a €1.2 billion contract to electrify the Garmsar–Inche Bourun line in Iran. In August 2015, company president Vladimir Yakunin
1680-498: The Hart-Shleifer-Vishny model it is assumed that all parties have the same information, while Schmitz (2023) has studied an extension of their analysis allowing for asymmetric information . Moreover, the Hart-Shleifer-Vishny model assumes that the private party derives no utility from provision of the public good. Besley and Ghatak (2001) have shown that if the private party (a non-governmental organization) cares about
1740-505: The Joint Stock Company Freight One , a subsidiary of Russian Railways, sold 75% of its shares minus two shares for 125.5 billion rubles (about 4 billion $ ) to Independent Transport Company owned by Vladimir Lisin . Thus, Lisin as Russia's largest operator of rolling stock acquired control of a quarter of the freight market. As part of its reform efforts, RZD massively reduced its workforce, from 2.2 million in
1800-669: The Moscow ;– Tver and St Petersburg – Bologoye routes. Local trains in the rural areas were saved. The first and the only (since 2015) route for Sapsan trains. Moscow ( Leningradsky railway terminal ) – Tver (756A, 762A, 770A, 778A, 780A) – Vyshny Volochyok (758A, 768A, 776A) – Bologoye (756A, 762A, 770A, 778A, 780A, 784A) – Uglovka (758A, 760A, 768A, 778A) – Okulovka (758A, 760A, 768A, 778A) – Chudovo (756A, 758A, 768A, 776A, 780A, 784A, 786A) – Saint Petersburg ( Moskovsky railway terminal ) There are no Sapsan trains stopping at all stations on
1860-561: The US (via the Channel Tunnel) a possibility." Limited railway capacity is the main bottleneck for Russian coal exports to Asia. Demand for Russian coal in Europe has declined due to the energy transition and Russia's invasion of Ukraine and this reinforces the need for Russia to reorient coal exports to Asia. Various Russian actors have therefore proposed the rapid expansion of the country's eastward rail capacity. The Russian Federation
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1920-430: The company since 20 August 2015. As of December 2013, Russian Railways has controlling interests in the following companies: On 24 February 2022, in response to Russia's invasion of Ukraine , US President Joe Biden announced economic sanctions against several Russian companies, including Russian Railways. The main activities of Russian Railways involve freight and passenger traffic. In Russia, railways carry 42% of
1980-580: The company's revenue in 2017. The long-distance passenger fleet includes 19,386 rail cars as of 2017, with an average age of 19.1 years. Over 60% of long-distance passengers travel in third-class sleeping carriages. The long-distance rail passenger business is under increasing competition from airlines, due to their aggressive domestic pricing policies and generally shorter travel times for routes under 1,000 km. International rail passenger traffic dropped from 19.4 million passengers in 2013 to 6.8 million in 2017. In 2005–2010, JSC Russian Railways has launched
2040-646: The date with the lowest index. In 2010 and 2011, the average weighted index for calendar periods was 0.97 and the average volume of passenger traffic – 1.00. According to the JSC Russian Railways statement, the passenger transportation – except for some highly profitable directions – is unprofitable. These losses are partly compensated from the budget, and for the most part – with the help of cross-subsidies by income from freight. State-owned In market-based economies, state-owned assets are often managed and operated as joint-stock corporations with
2100-533: The discontinued Saint Petersburg – Moscow – Nizhny Novgorod route which allows passengers to take an 8 hour 11 minute journey without a train change in Moscow. On 1 July 2012, the Russian Railways company introduced a new tariff system for Sapsan trains which dynamically prices tickets based on two factors: The new rates range from 0.8 to 1.2 times the base rate for the day. It is possible to see
2160-448: The expansion of new service elsewhere in the system. The second-batch EVS1 sets (trainsets 9-20) will be same details as the first-batch EVS1 sets, but the second-batch EVS2 sets (trainsets 21 onward) will have retractable steps to suit for low platforms, unlike the first-batch EVS2 sets. According to the timetable valid from 30 October 2011, the direct train from Moscow to St Petersburg without intermediate stops needs 3 hours 40 minutes,
2220-467: The general budget. The creation of a state-owned enterprise from other forms of public property is called corporatization . In Soviet-type economies , state property was the dominant form of industry as property. The state held a monopoly on land and natural resources, and enterprises operated under the legal framework of a nominally planned economy , and thus according to different criteria than enterprises in market and mixed economies. Nationalization
2280-490: The high-speed rail sections linking Moscow–Kazan (1.2 trillion rubles), Moscow–Tula (268.6 billion rubles), Chelyabinsk–Yekaterinburg (122.6 billion rubles), Tula–Belgorod (86.8 billion rubles), Yekaterinburg–Nizhny Tagil (12.9 billion rubles) and Novosibirsk–Barnaul (62.3 billion rubles). The project design of the largest container port in Ust-Luga for reception and distribution of containerized freight on China–Europe route
2340-555: The market. In 2003, RZD launched a project to replace the narrow gauge on Sakhalin Railway to the broad gauge used in the rest of Russia, which it formally completed in August 2019. The share of privately owned wagons in the freight transport increased to one-third of the total by 2005. On 18 May 2006, the company signed an agreement with Siemens for the delivery of eight high-speed trains. On 23 May 2007, Russian Railways adopted
2400-533: The means of production may be labelled state socialism . State ownership was recognized by Friedrich Engels in Socialism: Utopian and Scientific as, by itself, not doing away with capitalism, including the process of capital accumulation and structure of wage labor. Engels argued that state ownership of commercial industry would represent the final stage of capitalism, consisting of ownership and management of large-scale production and manufacture by
2460-403: The new company logo Sans-serif RussianRail Grotesque Medium was used. In 2008, the new logo of Russian Railways became a runner-up for the international design competition WOLDA '08 award. Strategy 2030, an investment plan to expand and modernize the railway network, was approved by the Russian government in 2008. Since 2008, as part of the structural reform of rail transport, with separation of
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2520-399: The property rights approach based on incomplete contracting (developed by Oliver Hart and his co-authors), ownership matters because it determines what happens in contingencies that were not considered in prevailing contracts. The work by Hart, Shleifer and Vishny (1997) is the leading application of the property rights approach to the question whether state ownership or private ownership
2580-599: The public good, then the party with the larger valuation of the public good should always be the owner, regardless of the parties' investment technologies. More recently, some authors have shown that the investment technology also matters in the Besley-Ghatak framework if an investing party is indispensable or if there are bargaining frictions between the government and the private party. Sapsan The Sapsan ( Russian : Сапсан lit. ' Peregrine Falcon ' ), also known as Velaro RUS EVS ,
2640-599: The railway should be transferred to a joint-stock company with 100% state participation. The start of the state program for reforming the Russian railway sector was given by the establishment of Russian Railways in October 2003. The new company received over 95% of the assets belonging to the Ministry of Railways of the Russian Federation. In 2003, the Federal Law on Railway Transport divided the Ministry of Railways into
2700-592: The railways from the Ministry of Railways of the Russian Federation . RZhD is based in Moscow at Novaya Basmannaya str., 2. The operating units of the central part of the staff are at Kalanchevskaya str., 35. Railways in the Russian-occupied region of Crimea are controlled by Crimea Railway , a separate company. After the collapse of the Soviet Union in 1991, the Russian Federation inherited 17 of
2760-453: The rolling stock (including supply of Sapsan trains). In 2010, Federal Passenger Company was established as a fully owned subsidiary of Russian Railways, providing long-distance passenger services both in Russia and abroad. By the end of 2013, it operated all long-distance routes, except for high-speed Sapsan lines, which are operated by RZD. RZD issued its first dollar-denominated bond in 2010, raising $ 1.5 billion. On 28 October 2011,
2820-438: The rolling stock. In March 2016, RZD approved an updated version of high-speed rail development program until 2030. The 5 trillion ruble program includes the construction of Moscow–Kazan–Yekaterinburg, Moscow–Adler and Moscow–Saint Petersburg high-speed lines, as well as other high-speed lines connecting regional cities. The construction program is divided into three stages. By 2020, Russian Railways planned to put into operation
2880-537: The route. The fastest ones do not stop between Moscow and Saint Petersburg at all. Numbers of the trains which stop at intermediate stations are listed above. Such measures were implemented to increase speed. Former route of Sapsan trains. Since 2015, new Talgo Strizh train was introduced. All the Sapsans were directed to Moscow – St Petersburg route. Talgo trains are also high speed but more suitable for this route. On 1 March 2018, Russian Railways reopened
2940-514: The services infrastructure of transportation activity and the emergence of a competitive environment, Russian Railways has been transformed into a vertically oriented holding company. In 2009, the investment budget was 262.8 billion rubles (excluding VAT), of which 47.4 billion for projects related to the preparation and staging of the Olympic Games in Sochi; 58.7 billion for the renovation of
3000-625: The shipping company CMA CGM announced to be acquiring the French logistics company Gefco SA from Russian Railways and minority shareholder Stellantis . On 11 April 2022, the Wall Street Journal and Reuters reported that the International Swaps and Derivatives Association had determined a "failure to pay" credit event occurred on 250 million CHF worth of Swiss franc loan participation notes linked to an entity related to Russian Railways, RZD Capital. The determination
3060-484: The state's management policies, though these rights are not property rights as they are not transmissible. For example, if a family is allocated an apartment that is state owned, it will have been granted a tenancy of the apartment, which may be lifelong or inheritable, but the management and control rights are held by various government departments . There is a distinction to be made between state ownership and public property. The former may refer to assets operated by
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#17327916012703120-577: The state. Within the United Kingdom, public ownership is mostly associated with the Labour Party (a centre-left democratic socialist party), specifically due to the creation of Clause IV of the "Labour Party Manifesto" in 1918. "Clause IV" was written by Fabian Society member Sidney Webb . When ownership of a resource is vested in the state, or any branch of the state such as a local authority , individual use "rights" are based on
3180-527: The state. State ownership is advocated as a form of social ownership for practical concerns, with the state being seen as the obvious candidate for owning and operating the means of production. Proponents assume that the state, as the representative of the public interest , would manage resources and production for the benefit of the public. As a form of social ownership, state ownership may be contrasted with cooperatives and common ownership. Socialist theories and political ideologies that favor state ownership of
3240-434: The total cargo traffic, and about 33% of passenger traffic. Some passenger categories, such as pensioners, members of parliament, and holders of Soviet and Russian state decorations, receive free or subsidized tickets. In 2013 railways carried nearly 90% of Russia's freight, excluding pipelines. In 2014, railway infrastructure and locomotive services accounted for 74% of the company's total revenue. The cost of freight tariff
3300-473: The train from Moscow to Nizhny Novgorod 3 hours 55 minutes. Introduction of Sapsan initially caused cancelation of affordable daytime trains between Moscow and St Petersburg. Since the end of 2012, Moscow – St Petersburg daytime trains other than Sapsan have been running again. New bridge crossings were built, platforms along the railway were reconstructed and additional track was completed in 2015. New Lastochka commuter trains were introduced on
3360-426: Was alleged that the contractors were actually shell companies , used to convey billions of dollars in tenders to close associates of Yakunin, president of RZD. Zheldoripoteka, RZD's real estate arm, was revealed to have sold land plots located close to railway stations in major cities to the son of Russian Railways president Vladimir Yakunin. Far East Land Bridge, a company partnered with a Russian Railways subsidiary,
3420-556: Was also linked to Yakunin's son. On 16 October 2012, Russian Railways has completed competitive negotiations with potential buyers of the remaining 25-percent plus 1 share stake in JSC Freight One . The best binding offer was received from the Independent Transport Company LLC. The assets were sold for 50 billion rubles. In early November 2012, Russian Railways announced the purchase of 75% of
3480-529: Was carried out by Siemens at Erlangen and Krefeld in Germany. In August 2009, it was announced that the fifth Sapsan had been delivered to Russia, of the eight that were planned. Four single-voltage ("EVS1", 3 kV DC powered, trainsets 5-8) trains entered passenger service at the end of 2009 on the Moscow ;– St Petersburg route , with the dual-system trains (EVS2, trainsets 1-4) entering service on
3540-595: Was dismissed, allegedly because of poor performance and mismanagement. Yakunin was replaced by Oleg Belozyorov . RZD International began works on the reconstruction of the Serbian Vinarci – Djordjevo line in 2016. The Moscow Central Circle railway, designed and managed by Roszheldorproject , an RZD subsidiary, opened in September 2016. In July 2018, the company announced plans to phase out third-class carriages on long-distance trains by 2025. On 8 April 2022,
3600-493: Was the most successful passenger train of JSC Russian Railways with occupancy rate of 84.5% (according to RZD in 2010) and profitability of 30% (although capital costs were not included in its calculation). Passenger tariffs (except for travelling in the stateroom, sleeping and VIP-cars) are approved by the State, represented by the Federal Tariff Service with social orientation of its traffic operations below cost. Passenger fare
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