Yerevan mayor fires company responsible for ‘sabotaging’ municipal garbage services
Yerevan Mayor Hayk Marutyan has unilaterally terminated all contracts with the only company that is responsible for garbage collection in the Armenian capital.
The decision was made due to the fact that for a long time the company Sanitek has not been fulfilling its obligations in full.
Issues with the company’s work began in 2017 and increased in 2018 – and since August 2019, Sanitek has largely ceased to engage in garbage collection.
The city administration conducted an investigation into the matter, and the mayor later explained that it was necessary to have documented facts about whether Sanitek was properly fulfilling the agreements it had concluded and also to verify the legality of concluding the agreements themselves.
The fact is that this international company began to work under the former, that is, pre-revolutionary government.
Mayor Hayk Marutyan says the check has been completed and justified his decision to terminate the contracts with the results of investigation, noting there has long been a shortage of garbage cans and an abnormal condition of existing ones, as well as an insufficient number of garbage trucks.
Sanitek is a branch of an Lebanese international waste management organization. The company was established in 2010, and since December 2014 it has been working in the capital of Armenia.
Sanitek won an international tender announced by the former authorities of Armenia. The initial investment of the company at the time when it began to perform its duties amounted to ten million euros.
Relations between the Yerevan mayor
The garbage ordeal in Yerevan has been going on for about a year now.
Yerevan Mayor Hayk Marutyan publicly expressed dissatisfaction with the company’s work several times and made statements that “Yerevan residents will no longer tolerate work of this quality.”
In the spring of 2019, Sanitek was fined twice for failing to fulfill its obligations. The total amount of fines amounted to 39 million drams [about $80 thousand].
In mid-July, the company admitted that it had serious financial problems, and explained them as being due to “unreasonable sanctions and fines” from the mayor’s office.
Director of the company Nicholas El Tavil said that their losses are associated with the fact that Yerevan City Hall has not fulfilled its promises – that is, repairing the road leading to a garbage dump on the outskirts of Yerevan, on which, according to the head of Sanitek, the expensive company garbage trucks deteriorate.
The last time the company was fined AMD 12 million [about $25 thousand] in August 2019. However, the management of Saniteka was warned in advance of violations of the terms of the contract and offered to eliminate them within a reasonable time. The fine was imposed after it became clear – the company ignores warnings from city authorities.
The Elk faction (“Exit”), representing the political power of Prime Minister Pashinyan in the capital’s administration, proposed terminating the contract with the operator who is responsible for garbage collection in Yerevan:
“We propose announcing an international competition, to attract a new operator that will carry out garbage collection and sanitary work in the capital. Problems with the collection and disposal of garbage in Yerevan lie in the agreement signed with Sanitek four years ago. There must be competition in the field of waste management.”
“When a contract was signed several years ago with the international organization Sanitek, registered in Beirut, the competition for the second operator was never announced,” said David Khazhakyan, a representative of the opposition Luys faction in the capital’s administration.
In order to somehow improve the situation, the city authorities purchased new garbage trucks and tanks.
For this, the government allowed the use of funds from the state budget reserve fund. A total of 900 million drams were allocated [about $1.8 million]
Sanitek’s response to the accusations
Sanitek denied contact with the former mayor of Yerevan, Taron Margaryan, who is a member of the former ruling Republican Party of Armenia. The assumption that the company’s fleet had garbage trucks belonging to the former mayor, which he took from Sanitek after his resignation, was also denied.
When asked why the situation with garbage collection worsened precisely with the coming of the new government, the company said that problems arose earlier, and the crisis simply coincided with the arrival of new ones.
In July, Sanitek announced that it would hold a large press conference in Tbilisi at which it will provide answers to all questions. In addition, it offered reporters transport to the Georgian capital and food.
The company’s proposal did not please the opposition Luys faction in the capital’s administration. Its head, David Khazhakyan, said that he did not understand how a company that has financial problems is going to hold a press conference in the capital of a neighboring country, taking on the expenses of journalists for travel and meals.
As a result, the conference was held in Yerevan. However, an explanation was made why it was planned to be held in Tbilisi, and why the director and owner of Sanitek Nicolas El Tavil was not present at the press conference in Yerevan and answered the journalists’ questions via Skype.
It turned out that the company feared the director’s arrest in connection with the criminal case initiated against Sanitek. It was instituted in February 2019 in connection with non-payment of taxes in a large amount.
Sanitek Director Nicholas El Tawil argues that employees are subject to aggressive administrative pressure and see political implications in all of this.
“The criminal case is unfounded and illegal, it has political motives, this is one of the numerous attempts of the Yerevan Municipality to exhaust the financial resources of Sanitek, which, in essence, pursues one goal – to confiscate the property of a private investor by the authorities in an unfair and discriminatory way,” said Nicholas El Tawil
In July 2019, Sanitek International filed a lawsuit against the City Hall of Yerevan, demanding compensation in the amount of more than 24.7 million drams [about $52 thousand].
Now in court there are already two lawsuits, the second – from Sanitek itself, that is, a subsidiary of Sanitek International.
Before going to court, Sanitek repeatedly demanded that City Hall take measures in connection with the fact that their garbage containers are constantly set on fire or broken. The company also insisted on repairing the road leading to the landfill. Sanitek also considers the fines the company suffered unfairly and claim that it is because of them that they cannot pay their employees.