The Railway Authority revoked the licence of the Jindřichův Hradec railway to operate transport

Martin Štěrba

The Railway Authority has revoked the license of Jindřichův Hradec local railways (JHMD) to operate rail transport. The reason is the financial unfitness of the company. JHMD has been bankrupt since last October. It stopped running trains in October because it did not have the necessary permits.

JHMD owes around CZK 300 million, according to a debt overview. This is based on information in the insolvency register. The company operated trains on narrow-gauge tracks until the fall.

Last week, after more than a year, the railway authority concluded the administrative proceedings to revoke JHMD’s authorization to operate rail transport, spokeswoman Pavlína Straková said.

“The procedure for revoking the license was suspended last year at the company’s request. However, Jindřichův Hradec local railways did not submit documents demonstrating an improvement in their financial situation within the set deadlines and were thus unable to prove that they fulfilled the conditions of eligibility under the Railways Act,” said Jiří Kolář, director of the Rail Authority.

JHMD had earlier asked the Railway Authority to suspend all proceedings related to the operation of the railway.

Without these certificates, transport on the lines from Jindřichův Hradec to Nová Bystřice and Obratana cannot be operated, insolvency administrator Daniela Urbanová said in the insolvency register. According to the administrator, the company also does not meet the conditions for the court to allow it to reorganize.

The administrator said that without these certificates, it is impossible to start negotiations with the South Bohemian Region and the Vysočina Region on possible contractual relations and passenger transport for 2023.

According to her, the company’s operations have been loss-making for a long time. According to the company, the satisfaction of the CZK 108 million claims by the Vysočina Region would change the situation.

The company filed for insolvency in September 2022. At the end of June, it had 140 creditors and owed CZK 160.7 million. The claims continue to grow.

Raiffeisenbank filed claims against the company for CZK 100.5 million in October, and in December, the State Fund for Transport Infrastructure (SFDI) filed lawsuits for almost CZK 78 million.

JHMD has no money to repay its debts. It argues that the Vysočina Region does not pay it a fee for the use of the road. The Vysočina Region denies this, stating that it acts by a valid contract.

The South Bohemian Region and the Vysočina Region arranged replacement bus transport at the site of the narrow gauge railway. The municipalities located on the line of the Jindřichův Hradec narrow gauge railway want to work together to restore railway operation on the line.

They will form a registered association for this purpose. Restoring the operation on the Jindřichův Hradec narrow gauge railway would cost about CZK 20 million, Jan Šatava, one of the founders of JHMD and former chairman of the board of directors, said in November.

JHMD owns and operates narrow gauge railways from Jindřichův Hradec to Obratan and Nová Bystřice.

Operation on the Nové Bystřice line began on 1 November 1897. According to an earlier statement from the company, the trains carried about 400,000 passengers annually in the past years. Two-thirds of the lines are in southern Bohemia.