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28.09.2011 11:16

The EC Investigates Gas Incumbents across Europe

The EC would not disclose which countries were involved; Bulgaria's Overgas reported it cooperated with the inspectors, Bulgargaz investigated over incumbency

AUTHOR: publics.bg

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The European Commission launched a series of "dawn raids" Tuesday to investigate possible anti-competitive practices at 10 natural gas companies in Central and Eastern Europe, Platts reported.

"The European Commission can confirm that, today, commission officials undertook unannounced inspections at the premises of companies active in the supply, transmission and storage of natural gas in several member states," the EC said in a statement.

"The commission has concerns that the companies concerned may have engaged in anti-competitive practices in breach of EU antitrust rules or that they are in possession of information relating to such practices," it said.

The EC said that in most countries, it was the first competition inspection in the energy sector and in some, the first-ever competition inspection.

The EC said its investigation focused on upstream supply level, where competition may be restricted unilaterally or through agreements.

The gas companies being investigated were suspected of exclusionary behavior, such as "market partitioning, obstacles to network access, barriers to supply diversification, as well as possible exploitative behavior, such as excessive pricing."

EU antitrust rules prohibit abuse of dominant positions and restrictive business practices.

Unannounced inspections are normal procedure and a preliminary step into suspected anti-competitive practices, the EC said.

The EC would not disclose which countries were involved. "We have released what information we can for the moment. It is now up to the countries to come forward," said an EC competition spokeswoman.

Bulgarian gas utility however informed that it agreed to cooperate with the EC by providing the inspectors and provided all documentation that they required. There is also evidence that the incumbent gas company Bulgargaz has also been subject of inspection, as it is the only company to actually have access to the distribution network.

There is no legal deadline to complete the antitrust investigations. The EC said that the duration depends on a number of factors, including the complexity of each case and the extent to which the companies involved cooperate with the EC.

The EC conducted a series of antitrust investigations between 2007 and 2010 against a number of gas incumbents in Western Europe -- Distrigas in Belgium's market, RWE and E.ON in Germany's market, GDF Suez in France's market, Eni in Italy's market.

In January 2008, the EC imposed a Eur38 million fine on E.ON for breaching a seal that the EC had fixed on an office door on May 29, 2006, to secure documents during a "dawn raid" inspection, as part of enforcemen activities against allegations of anti-competitive practices in Germany's energy markets.