Lviv’s long-term construction project: Poles, with whom Sadovyi terminated a contract for a waste processing plant, have filed a lawsuit in international arbitration.

The Polish company Control Process SA, which had failed to meet its deadline for building a waste processing plant in Lviv, has filed for international arbitration after the city authorities terminated the agreement.

The “Our Money” project reports this.

Journalists recalled that construction of the waste processing plant in Lviv began back in 2021. The tender for the project was conducted by the European Bank for Reconstruction and Development (EBRD), one of the project’s lenders. In May 2021, the Green City LPU signed a contract with the contractor, the Polish company Control Process SA. The plant is scheduled for completion in August 2023, but the design has been subject to constant changes, delaying completion.

In 2024, a public dispute erupted between the city council and the contractor, and the dispute continued in 2025. The case is being resolved through arbitration. The Poles claim that the mayor’s office failed to pay for the work on time and in full. The mayor’s office claims that the Poles had already been paid 29 million euros, but they missed the construction deadline—the plant was supposed to be ready by the end of 2025.

According to NGL.media, last year, Lviv police opened a criminal case regarding possible abuses during the construction of a waste processing plant. A Polish contractor and unidentified Lviv City Council employees are suspected of embezzling budget funds.

On March 23, Green City terminated its contract with Control Process SA, citing the contractor’s prolonged failure to fulfill its contractual obligations. Earlier, on March 5, Control Process SA filed a claim with the International Chamber of Commerce (ICC). According to the ICC, the amount of payments awarded to Green City by the FIDIC Arbitration Tribunal exceeds €6.9 million.

As investigative journalist Yuriy Nikolov notes, the saga surrounding the construction of a waste processing plant in Lviv has dragged on suspiciously.

“One mayor once explained to me the logic behind mayoral salaries (I’m quoting it as I remember it): ‘Garbage is a must. Whatever it is, it’s up to you whose garbage trucks your landfill will accept. The hauling rate is opaque, so you can stuff it with whatever you want. You can always dump a stubborn garbage collector who refuses to bear the consequences. Because you hold the budget payments in your hands, which he must cash.’ This was during the years when Sadovyi, at the height of his standoff with the president, was shipping trucks carrying Lviv garbage all over Ukraine, and apparently even reached Kyiv for delivery. That was a long time ago. But since then, it’s simply astonishing – Sadovyi has never been able to complete the waste incineration plant. Whichever way you look at it, it’s highly suspicious,” Nikolov writes .

Lviv politician Volodymyr Hirnyak notes that Lviv is suffering significant financial and reputational damage due to the legal battle with Polish builders.

For twenty years, Sadovyi “built” a waste processing plant in Lviv, and finally, just when it was about to open, it ended in a massive scandal and disgrace across Europe. Moreover, it appears that the plant will no longer be built in Lviv anytime soon; the case will be stuck in international courts, and the city is suffering reputational and financial losses. As a reminder, the project was financed by the city budget, an EBRD loan, an E5P grant, and a Sberbank loan. Approximately €30 million and over ₽100 million have already been spent on the plant’s construction.
“And one more thing to consider when assessing the damage: every day the plant’s opening is delayed means the city incurs losses due to waste removal and disposal at landfills in other cities,” writes Girnyak.

He notes that the Polish company has built several facilities in Europe, and there have been no complaints. According to Girnyak, the city authorities simply find the existing waste disposal system more profitable. “As a Polish businessman I knew said many years ago: ‘You’ll never build a plant here. Because it won’t be profitable for those who make the decisions. Because our business is based on waste processing, and yours is based on its transportation,’” writes Vladimir Girnyak.

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