Main points
- Lviv terminated the contract with the Polish contractor Control Process SA due to inadequate quality of work and plans to attract Ukrainian contractors.
- The European Bank for Reconstruction and Development agreed to terminate the contract, and the customer plans to legally record the deficiencies and resume construction.
Lviv terminated a contract with Polish contractor Control Process SA for the construction of a waste plant due to inadequate quality of work. The European Bank for Reconstruction initially tried to reconcile the parties, but it did not work out.
Director of the Green City Construction Company Oleksandr Yegorov explained to Channel 24 that they plan to resume construction in the future, but will focus on Ukrainian contractors.
Why couldn't the parties reach an agreement?
For reference! In 2019, Lviv decided to build its own waste processing plant using budget funds and a loan from the EBRD. In October 2020, a contractor was selected – the Polish company Control Process SA. Due to the full-scale invasion, the deadline for the completion of the facility was “moved” somewhat. In September 2024, another deadline passed, and construction was suspended. The Lviv City Hall accused the contractor of violating the terms of the contract.
The day after the contract was terminated, the contractor sent a letter of disagreement to challenge the decision. However, the client has a developed legal strategy to defend its interests.
At the beginning, the European Bank for Reconstruction and Development acted as a moderator between the parties, but eventually realized the seriousness of the situation and the lack of prospects.
The bank cannot drag out the project for a decade, so it agreed to terminate the contract. After that, the contractor tries to lobby to influence the bank's decision in various ways. However, the chance has already been lost,
– explained Egorov.
The customer is currently consulting with law enforcement and regulatory authorities, as this is an unprecedented situation with an international FIDIC contract.
Therefore, the customer will attract maximum resources to conduct a forensic construction examination in order to record deficiencies and adjust the design and estimate documentation before a new procurement of construction services.
When will construction work resume?
In parallel, they plan to resume the construction of the first phase, which the contractor blocked for almost a year, and digitize the documentation for the second phase. Only after a full package of claims regarding incomplete construction and penalties is formed, they plan to look for a new contractor.
The contractor has not yet left the site, there are still several people there, because he understands perfectly well that the more unfinished work he leaves, the more claims and fines he will receive. The contractor carries out slow work, not coordinated with the customer, ignores the engineer's instructions to eliminate defects and sabotages the installation of equipment,
– explained Egorov.
When the contractor Control Process SA was selected for the work, it was not yet known about its scandalous projects in Poland.
The director of the Green City LCP recommends that communities obtain all letters of recommendation regarding the contractor before starting projects and engage local Ukrainian companies as contractors instead of directly hiring foreign companies, as this will allow them to pay taxes to the Ukrainian budget.
“Everything that was built at the plant was done by Ukrainian companies, but they did not receive full financing. This is proof that Ukrainian companies are capable of implementing complex projects. Of course, design technologies must come from foreign companies, but Ukrainian ones can implement them,” Yegorov emphasized.
What else is known about the construction of a waste processing plant in Lviv?
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The plant in Lviv was supposed to process up to 250 thousand tons of waste annually, and all work was supposed to be completed in 2023.
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The readiness of the building itself is estimated at approximately 80%, while part of the structure remains unfinished, in particular, the construction of fire tanks has only just begun.
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In 2025, Lviv Mayor Sadovyi informed representatives of the governments of Ukraine and Poland about the difficulties with construction, emphasizing that this could affect the further involvement of Polish companies in the reconstruction of Ukraine.