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Commission announces settlement of an anti-trust case against E.ON's for blocking capacity to its gas networks (06 May 2010) The Commission opened anti-trust proceedings against E.ON following inspections, alleging that it had abused a dominant position by unnecessarily booking on a long-term basis the largest part of the available transport capacity at the entry points into its gas transmission networks. These bookings may have prevented other gas suppliers from accessing the German gas market, depriving them of the opportunity to compete with E.ON. As such, the case mirrored a previous one dealt with by the Commission in the GdF Suez case IP/09/1872. Rather than pursuing the case to a final decision and imposing fines, the Commission settled the case on the grounds of undertakings proposed by E.ON, which undertook to release large capacity volumes at the entry points to its gas networks by October 2010. The capacities to be released at different entry points by October correspond to around 15% of the pipeline capacity and will be published on the website of E.ON Gastransport GmbH in the course of next week. From October 2015, E.ON will further reduce its bookings of entry capacity in its German grid to 50% and in E.ON's grid for low-calorific gas to 64% of pipeline capacity. When the Commission accepts such commitments to close a case it takes a formal decision, and the commitments then become legally binding, on pain of fine of up to 10% of total annual turnover without having to prove any violation of the EU's competition rules. The Commission considered that the commitments are expected to have a major structural impact on the possibility for other companies to compete on the German market, to the benefit of domestic and industrial gas consumers. It reviewed the commitments in close cooperation with the German energy regulator (Bundesnetzagentur) and the German competition authority (Bundeskartellamt). This is already the ninth major antitrust decision adopted by the Commission in the wake of its energy sector inquiry (see on the sector inquiry IP/07/26; for other major antitrust decisions in the field of energy, besides GdF Suez, see IP/09/410, IP/08/1774, IP/10/425 IP/10/290; IP/09/1099; IP/07/1487; see also MEMO/10/29). Comment: this case follows the recent trend of the Commission accepting very major commitments from companies to close cases in the energy sector, rather than fining them and requiring them to stop the abuse in future. The advantage of this approach is that in accepting commitments, the Commission can potentially extract greater remedial action by the company than the company would take in order to remedy the abuse following a fining decision; see for example the long-running dispute with Microsoft on the action it had to take to bring to an end the abuse following a Commission decision and imposition of a fine. For more details on this case and the text of the decision accepting the commitments, please click here. This case highlights the need for energy companies to be fully informed and up to date on Community competition law in this sector. On 2-3 June this year Claeys & Casteels will organise the Second EU Energy Law and Policy MasterClass, an intensive training event figuring courses given by key academics, lawyers and decision-makers, giving a unique insight and working j-knowledge of these key issues. For more details, please visit: http://www.energymasterclass.com.  Other articles from May: List all messages of the previous month: April 2010 List all messages of the next month: June 2010 |