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Budapest to appeal decision on cancelled metro train order

The city of Budapest will appeal a decision by a French court on a cancelled order for metro trains, but it is also considering calling a new tender for the vehicles, mayor István Tarlós said at a press conference on Wednesday.

A French court in Nanterre on Tuesday accepted a plea by engineering giant Alstom to prevent Budapest local transport company BKV from calling down a bank guarantee for the delivery of underground trains, Alstom told MTI.

Under a contract signed in May 2006, Alstom was to deliver 22 trains for the capital's number two metro line for €150 million and 15+7 trains for the fourth line, under construction at present, for €114 million. BKV said in October 2010 that it cancelled the contract because Alstom "failed to do all that was expected of it in the interest of fulfilling the contract".

Alstom's application for permits for the vehicles it was to deliver was hampered because the brake systems used differed from those stipulated in Hungarian regulations.

The French court accepted Alstom's argument that the cancellation of the contract was unlawful, thus the bank guarantee could not be called down. (MTI-ECONEWS)