Unilateral conduct in the energy sector: An overview of EU and national case law - Antitrust Writing Awards 2013 3/3/21,

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Unilateral conduct in the energy sector: An overview of

EU and national case law
John Ratliff, Roberto Grasso, e-Competitions, 15 March 2012, N°44203.

The object of this foreword to the Special issue of e-Competitions is to provide an overview of
the most recent developments in the EU Competition authorities’ practice regarding unilateral
conduct in the energy sector, as reported in e-Competitions [1]. There are more than 90 cases
reported (including national court judgments and investigations, which were settled or did not
result in a decision).

The approach taken here is to look at the way that the national competition authorities
(“NCAs”) and national courts have been applying what is now Art. 102 of the Treaty on the
Functioning of the European Union (“TFEU”) [2], or its national equivalents, since Regulation
1/2003 [3], alongside the European Commission’s (“EC”) recent enforcement. To that end, we
have broken out the material into what we hope are useful topics, as explained below.

The EC’s activity in the energy sector has been important and extensive in the last few years.
Notably, the EC has adopted nine decisions since the EU Energy Sector Inquiry [4] (“the EU
SI”), including some significant settlements pursuant to Art. 9 of Regulation 1/2003.

In its Final Report on that inquiry the EU had identified several shortcomings in the electricity
and gas markets: Mainly too high a market concentration in most national markets; a lack of
liquidity, preventing successful new entry; too little integration between EU Member State
markets; and the absence of transparently available market information, leading to distrust in
the pricing mechanism [5].

Most of the EC investigations since appear to have been prompted by the EU SI. Notably, the
EC has taken on cases related to: Vertical integration conflicts; foreclosure issues in relation to
infrastructure capacity; foreclosure issues in relation to long-term contracts; cross-border
issues; and alleged market manipulation. As we will see, new abuses such as “strategic
underinvestment”, “capacity hoarding” and “withholding of generation capacity” have been
raised.

National decisions have sometimes addressed similar issues, with some cases of considerable
importance. For example, the Italian Competition Authority’s (“ICA”) cases on strategic
underinvestment in 2006 and on alleged market manipulation in 2011. Other national
decisions address different concerns. For example, there are many cases on exploitative
abuses, such as excessive pricing; or tying obligations related to supply or payment; and
many cases focussing on practical issues of interconnection (such as access to technical
information); and access to infrastructure (such as a voltage grid for onward local supply). It
is also interesting to see that some national cases started with national energy regulator
(“NER”) complaints to the NCA; and that, often a NCA may also “reciprocate” in the sense of
consulting a NER on the appropriateness of a proposed commitment.

Taken as a whole, it will be seen that there are a lot of decisions, generally showing a
developing pattern. There are many fines and many cases settled with commitments. It should
also be noted that there is an Energy Working Group in the European Competition Network of
EU NCAs, likely fostering a coordination of EU and EU NCA practice.

We now plan to review the recent cases reported based on the following topics (although it
may be appreciated that some issues will come up under more than one topic heading, as
cases are described).

1. Abuse of strategic underinvestment

The EC has recently closed two investigations related, amongst other things, to alleged
strategic underinvestment, with commitments: One case concerned GdF Suez’s alleged
foreclosure of access to gas import capacities in certain balancing zones in France; the other
concerned ENI’s alleged abuses on the market for the transport of natural gas to Italy and on
the downstream markets for the supply of gas.

In these cases the EC’s references to “strategic underinvestment” were new. In its ENI
decision, the EC stated that a dominant essential facility holder is under an obligation to take
“all possible measures to remove the constraints imposed by the lack of capacity and to

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organise its business in a manner that makes a maximum amount of capacity of the essential
facility available”.

It could be argued that this just followed from earlier essential facility cases, such as that
involving access to the ramp at Frankfurt Airport [6]. However, the EC’s position was
controversial, especially if it was meant to infer a wide duty.

It appears that, in the EC’s view, a company in such a position may be obliged to share the
existing capacity, or even to make specific investments to expand the capacity of its facility, if
there is appropriate demand and it makes economic sense to do so, looking at the facility
concerned on a standalone basis.

However, it will be seen that these cases involve specific circumstances, where it appears that
a specific demand is identified and not met, not some broad doctrine that any dominant
company which controls an essential facility, always has to invest to meet any demand. In
other words, there still may be reasonable justifications for not investing, depending on the
facts.

(a) GdF Suez (2009) (EC)

In 2009 GdF Suez faced claims that it had foreclosed access to gas import capacities in certain
balancing zones in France, thereby restricting competition on the downstream gas supply
markets through, amongst other things, the strategic limitation of investment in additional
import capacity at two LNG terminals [7]. In one case, this was despite the existence of a firm
capacity request from a competitor following an open season procedure. The EC stated: “The
preliminary assessment also pointed to financial analyses, which apparently concluded that,
given the firm capacity requests received in the open season procedure, extension of the
capacity at the Montoir de Bretagne terminal would have been sufficiently profitable…..”. In the
case of another terminal at Fos Cavaou, the EC criticised that GdF had not conducted an open
season procedure to assess third-party demand. As part of its commitments GdF offered to
release capacity at the two LNG terminals.

(b) ENI (2010) (EC)

In 2010 ENI was faced with claims that it had abused its dominant position on the market for
the transport of natural gas to and into Italy, as well as on the downstream gas markets for
the supply of gas by, amongst other things, strategically limiting investments in its
international transmission pipeline system, despite short and long-term demand from third-
party shippers.

While denying any infringement, ENI offered a structural remedy, namely to divest its current
shareholdings in companies related to international gas transmission pipelines to a suitable
purchaser independent from ENI, who would not raise prima facie competition concerns.

The EC accepted commitments from ENI to divest its shares in the companies which own,
operate and manage the transport capacity on the international pipelines TAG, TENP and
Transitgas, bringing gas into Northern Italy respectively from Russia (TAG) and the North of
Europe (the TENP/Transitgas system) [8].

(c) ENI (2006) (Italy)

Interestingly, the strategic underinvestment abuse appears to be one of the few instances
where it is the EC that followed developing NCA practice, rather than the other way round.
Notably in 2006, in another case, the ICA investigated ENI’s decision not to pursue its planned
investment in pipeline capacity [9].

It appears that ENI planned an expansion of capacity through greater compression capacity on
the pipeline for gas from Algeria via Tunisia to Sicily, (the TMPC pipeline) operated by its
subsidiary. Afterwards, having allocated capacity, it was alleged that ENI delayed that
expansion because of an expected oversupply of gas to Italy. The ICA found this abusive, fined
ENI €290 million and ordered ENI to allocate capacity to third parties.

On appeal the fine was overturned on the basis that the issues were novel. In December 2010
the Italian Supreme Administrative Court ordered the fine to be set at €20 million [10].

2. Commitment to invest in new infrastructure

A related idea is the remedy, whereby a company may choose to offer to build more
infrastructure to meet a competition concern. This occurred in 2010 in the EC Svenska
Kraftnät case [11].

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There, the EC closed its investigation alleging that this entity (in fact a government controlled
department), which controlled transmission and balancing in Sweden, had abused its dominant
position by reducing export interconnection capacity between Sweden and its neighbours at
times of anticipated internal congestion in the Swedish transmission network.

The EC considered that this reduction of export capacity discriminated on the basis of
residence between Swedish electricity customers and customers in other EU Member States,
without any objective justification. The possible abuse was on the Swedish electricity
transmission market, but had effects on the wholesale and retail electricity markets in
neighbouring countries.

Interestingly, amongst other things, Svenska Kraftnät (“SVK”) committed to build and operate
a new 400 kV transmission line by the end of November 2011. This commitment was
considered necessary, because the system of bidding zones agreed in the other commitments
which were offered was considered not sufficient to manage congestion in the Swedish West-
Coast-Corridor. SVK also committed to divide the Swedish transmission system into two or
more bidding zones and manage congestion without limiting trading capacity on the
interconnectors.

It appears that SVK wanted to keep a unitary pricing zone in Sweden, whereas the grid
structure and pattern of supply and demand meant that variations in prices, with related
pricing zones, were required. In particular, without structural market changes, prices in
Southern Sweden could be higher than in the North.

Interestingly, it appears that, as a result of the changes concerned, some regions might have
higher prices (at least until the relevant grid bottlenecks were removed), while others may
have lower prices (e.g. the regions in neighbouring countries which had entered into supply
contracts relying on the interconnector supply, which SVK had blocked previously to keep
Swedish prices as a whole lower and unitary). Overall that appears to have been considered an
improvement in EU consumer welfare.

3. Access to infrastructure
There are two main NCA decisions we would like to mention here. (Other cases come under
other headings below.)

(a) Demasz/DHE
In February 2008, the Hungarian Competition Authority (“HCA”) held that the practice by
Demasz and DHE (respectively the owner and operator of the only electricity distribution
network in the Demasz service areas) of refusing requests from wind farms to transform
certain sections of their network into dual-system networks was objectively justified and did
not affect competition between wind farms [12].

The decision was influenced by the fact that the transformation of the network into a dual-
system is only one way of connecting wind farms to a dedicated connection point. The second
possibility is through an overhead or underground cable network built by the operator of the
wind farm itself. Demasz and DHE required all wind farms to build their own infrastructure
between their power generation sites and the dedicated connection points.

The HCA held that this practice was objectively justified. In particular, the HCA accepted that
the construction, operation and maintenance, as well as the development of a dual-system
network would require Demasz and DHE to incur costs that it would not incur if they did not
convert certain parts of their network into dual-system networks. Also the HCA accepted that
such an obligation would adversely affect their ability to develop their network independently.

For another case on wind farm access see the note on the ENEA Operator case, (2008)
(Poland) [13].

(b) Mainova (2005) Germany

In June 2005, the German Federal Court of Justice upheld a decision of the German
Competition Authority ordering Mainova, which is the incumbent regional electricity utility in
Frankfurt, to provide requesting operators with access to its medium-voltage power grids,
which they needed to supply their customers with electricity in their low-voltage area
grids [14].

Mainova alleged, amongst other things, that the operation of the network as a whole would
become more expensive, if it had to allow others in, as operating a network with “insular
exclaves” is inefficient. Interestingly, the Court rejected this ground of appeal, noting that

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rising costs were part of the liberalisation process and could be dealt with by delegated
legislation if the inefficiencies of a fragmented distribution should become excessive. Some
cherry-picking of the most lucrative areas was also to be expected, but such competition was
part of the liberalisation process.

Mainova also argued that for an “essential facility” abuse in German Competition law, a
company had to be dominant on the infrastructure market, here the medium-voltage power
grid, and the downstream market for area networks. The Court rejected this, considering that
dominance on the network/infrastructure was enough [15].

4. Long-term capacity booking as a refusal to supply

In two interesting cases the EC has focussed on the issue of long-term capacity bookings,
which were treated as a form of refusal to supply.

(a) GdF Suez (2009) (EC)

Here the EC found that GdF Suez (“GdF”), the leading gas supplier in France and owner of the
largest gas transmission networks in France via its subsidiary GRTgaz, had booked on a long-
term basis (until 2019) the vast majority of available capacities at the main entry points into
the French gas transmission network [16]. This meant that competitors could not acquire
transport capacities to enter the market.

The EC considered GdF’s gas network to be an essential facility, since access was necessary to
carry on business in the gas supply markets of GdF’s grid area. Further, GdF was found
dominant on several related import and supply markets. The long-term capacity bookings were
therefore treated as refusals to supply which could maintain or reinforce such positions.

GdF offered commitments to reduce its capacity bookings to a maximum of 50% on the H-gas
network, with a phased release (first some 10-15% of total capacity) at the most important
entry points, then later a further release, bringing GdF’s share to a maximum of 50% by 2014.

The EC appears to have rejected all arguments that the network could be reproduced
(although one may think that, to some extent, this may be viable in a cherry-picking strategy)
and further, not to have been deterred by the existing long-term supply contractual
arrangements.

(b) E.on (2010) (EC)

The EC took a similar position in the E.on case in May 2010 [17]. Controversially, the EC noted
that even if E.on had used its booked capacities for its own supply business, this could not, in
itself, exclude an abuse under Article 102 TFEU. The EC also emphasised that E.on built its
network pre-liberalisation, at a time when it would have been shielded from competition.

Whilst denying any infringement, E.on committed to a phased release of capacity for H-gas
(again first some 10-15% of capacity) and then to a further release bringing E.on’s share to
50% by 2015 and for the L-gas network to 64% by 2015.

5. Other capacity access and hoarding issues

Access to capacity has been the focus of various decisions at EU and national level, with cases
raising a variety of interesting and new issues.

(a) ENI (2010) (EC)

In the ENI [18] case, the EC alleged that the Italian incumbent had refused to grant access to
capacity available on the transport network (“capacity hoarding”), and offered capacity in a
less useful manner (“capacity degradation”), despite significant short and long-term demand
from third party shippers.

On capacity hoarding, the EC alleged that ENI would have refused to offer available or unused
capacity to other shippers on the pipelines concerned. It was also alleged that ENI failed to
increase the efficiency of capacity management, thereby mitigating congestion. Further, that
ENI may have understated the capacity technically available to third parties. This was treated
as a form of “constructive refusal to supply”.

As regards capacity degradation, the EC alleged that ENI may have intentionally delayed
allocation of new capacity or fragmented it into shorter sales, when it could have been offered

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on a longer term basis. Further, the EC alleged that ENI may have allocated separate and
uncoordinated capacity to complementary pipelines, or interruptible rather than firm capacity,
making it less useful and attractive.

The EC considered that such practices may have led to a foreclosure of competitors trying to
transport and sell gas to Italian customers and therefore may have restricted competition on
the downstream gas supply markets.

Interestingly, as noted above, ENI offered to divest its shares in the companies which own,
operate and manage the transport capacity on various international pipelines bringing gas into
Northern Italy, from Russia and the North of Europe.

The EC accepted these commitments, stating that they effectively addressed its the concerns,
namely the conflict of interest resulting from the vertical integration of the company in both
the transport and supply of gas. In particular, the EC considered that the commitments
ensured that third party requests to access the gas pipelines would be dealt with by an entity
independent of ENI. According to the EC, any incentive for ENI, as operator of the transport
pipelines, to make additional profits from transporting more gas on its pipelines was more
than outweighed by the incentive for ENI to maximise its profits from selling gas to customers
on the Italian wholesale market by reducing access to that market for potential competitors.

(b) RWE (2009) (EC)

The EC’s decision in the RWE case in March 2009 also involved the separation of transport
networks from the supply business [19]. Again, the vertical integration of production,
transmission and distribution activities was found to preserve an incentive for the owners of
the transport networks to favour their own supply business and to keep entry barriers for
newcomers high.

The EC took the preliminary view that RWE may have abused its dominant position on its gas
transmission network by way of refusal to supply transportation capacity.

The EC’s view was that RWE’s gas transmission network could be considered an essential
facility and that RWEmay have pursued a strategy of systematically keeping transport
capacities for itself, especially on important bottlenecks. RWE had booked almost the entire
transport capacity on its own network on a long term basis. The EC alleged that RWE may
have understated its technically available capacity and managed its transport capacities in a
way that prevented competitors from accessing it.

Whilst denying any infringement, RWE undertook to sell its entire German gas transmission
network with a total length of approx. 4000 km, including the necessary personnel and
ancillary assets and services, which the EC accepted.

This was a controversial settlement because unbundling was an issue raised in the Third EU
Energy Liberalisation Package.

(c) ENI/GNL Italia (2007) (Italy)

In March 2007, the ICA closed proceedings by accepting commitments from ENI, the Italian
incumbent, for the alleged abusive conduct of its subsidiary (GNL Italia) on the market for
liquefied natural gas (LNG) [20].

GNL Italia, the owner of (at the time) the only LNG receiving terminal in Italy, was accused of
having overbooked the whole terminal capacity and refused access to the facilities to third
parties. The concern was that ENI had bought up the terminal’s entire receiving and re-
gasification capacity between 2002 and 2005, with the aim of excluding other undertakings in
competition with ENI (which holds a dominant position in the downstream market of wholesale
supply of natural gas) from providing the national system with LNG.

The relevant markets identified were the market for continuous re-gasification of LNG in the
terminal of Panigaglia and the downstream market of wholesale supply of gas in the Italian
system. The final commitments submitted by ENI consisted in a gas release programme over
two years by ENI for some 4 bcm of gas, together with favourable conditions of supply [21].

On access to re-gasification capacity, see also the Enaga Gas Natural case in Spain [22].

6. Long-term / exclusive supply contracts

Another type of abuse investigated by the EC in recent years concerns long-term and exclusive
supply contracts in the downstream gas and electricity sectors. The EC focussed on such

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abuses in, for example, its Distrigas and EdF cases [23]. Both ended with commitments.

(a) Distrigas (2007) (EC)

In its 2007 decision, the EC expressed concerns under what is now Art. 102 TFEU that
Distrigas’ long-term gas supply contracts in Belgium would prevent customers from switching
and would thereby limit the scope for other gas suppliers to conclude contracts with
customers, foreclosing their access to the market [24].

However, Distrigas offered commitments, which were considered sufficient to address those
concerns. Notably, Distrigas undertook to ensure that for each calendar year a minimum of
65% and, for all calendar years over the four year commitment period, an average of
minimum 70% of the gas which it supplies to industrial users and electricity producers in
Belgium would be contestable by third parties, or “returned to the market” (with some
flexibility built into these assessments). Distrigas also removed certain use requirements on
customers, allowing them to resell gas if they so wished.

No new contract with industrial users and electricity producers could be longer than five years
in duration. Customers with existing contracts which were that long or longer were given
unilateral termination rights with prior notice and without indemnity so that, in effect, they
became one year contracts. The commitments were to last for four years from the start of
2007 (i.e. until December 2010) and were to apply as long as Distrigas held a share of more
than 40% of the market and at least a 20% gap to its nearest competitor.

(b) EdF (2010) (EC)

In the EdF case the EC alleged that the volume, duration and exclusive nature of EdF
electricity supply contracts with large industrial customers hindered competitors’ entry and
expansion in this retail market [25]. In addition, the EC alleged that the supply contracts
contained an illegal prohibition on resale insofar as electricity had to be consumed at the point
of delivery. The EC considered that this restriction prevented customers from managing their
energy supply and exacerbated a lack of liquidity on the trading market.

In March 2010 the EC accepted commitments offered by EdF. EdF offered to ensure that each
year an average of 65% of the electricity that it had contracted to sell to large industrial
customers would return to the market, with a minimum of 60% per calendar year.

Interestingly, the EC stressed that the objective here was to create a real opportunity for
competition, noting that it would have been disproportionate to oblige EdFto give away some
customers, which would have amounted to imposing a market share cap.

EdF also committed to enter into non-exclusive contracts with large industrial customers, with
a maximum duration of five years, or provide that the customer can opt out of the contract,
without incurring a penalty, every five years. To address the allegedly illegal resale restriction,
EdF offered to remove the relevant provision from its new contracts, and to allow large
industrial customers to change the power withdrawal points stipulated in their contracts. These
commitments are for 10 years unless EdF’s market share falls below 40% for two consecutive
years.

NCAs have adopted a number of decisions with regard to long-term supply contracts.

(c) EdF / KalibraXE (2007) (France)

In April 2007, the French Competition Authority (“Conseil de la Concurrence”; “Conseil”)
closely scrutinized EdF’s exclusivity clauses on the market for the supply of electricity to
eligible customers, in response to a complaint by a trading operator, KalibraXE. That company
sought interim measures denying EdF the ability to enter into exclusive supply contracts [26].

The Conseil first stressed that exclusivity provisions to the benefit of a dominant operator are
not a per se abuse of a dominant position. In line with the findings of the EU SI, the Conseil
distinguished between partial exclusivity and full exclusivity. It then considered the exclusivity
clauses, taking into account the scope and duration of the exclusivity clauses, the existence of
technical reasons for imposing exclusivity, possible efficiencies and financial compensation
granted to the customers, in exchange for the exclusivity.

The Conseil found EdF’s conduct abusive, because of the lack of information given to EdF’s
potential customers regarding the conditions for early termination (notably the amount of any
indemnity payable) and the ambiguity of the clauses describing the circumstances in which a
termination penalty was triggered.

The Conseil ordered interim measures, requiring EdF within two months to define in its general
terms and conditions of sale, the rules applicable in case of early termination of the supply

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agreements concluded with its customers who have exercised their eligibility and to inform
customers that they will not incur any penalty at the normal expiry date of the agreement.

(d) DONG (2005) (Denmark)

In December 2005 the Danish Competition Council (“DCA”) scrutinised a supply agreement of
natural gas provider DONG, which contained an exclusive supply clause preventing
Hovedstadsregionens Naturgas (“HNG”) and Naturgas Midt-Nord (“MN”) from buying gas from
other suppliers for a little over six years, and two price methodologies, whereby the supply
price to these companies varied according to whether they were supplying metered or non-
metered customers [27].

DONG was found to have a dominant position, with some 83% of the Danish wholesale market
and some 65% of the Danish retail market. HNG/MN were held to account for some 18% of
the Danish retail market.

The DCA objected to the duration of the agreements and their pricing structure. However, the
DCA approved the supply agreement between DONG and the two retailers, after the parties
offered binding commitments shortening the agreement by two years and committing to avoid
exclusivity clauses and different cost prices if they were to renegotiate the agreement.

(e) ENEL / Clienti Idonei (2003) (Italy)

In November 2003, the ICA imposed a €2.5 million on ENEL and its wholly-owned subsidiary
ENEL Energia, for applying various exclusive dealing arrangements in violation of what is now
Art. 102 TFEU [28].

The ICA found that ENEL Energia had abused its dominant position on the market for
electricity supply to eligible customers by, amongst other things, imposing exclusive
purchasing obligations; a ban on purchases from competitors; price increases in case of
purchases from competitors; and rebates conditional upon the renewal of the supply
agreement.

All these provisions, applied by a dominant firm, were found to tie a substantial part of the
demand, resulting in foreclosure of competition. It appears that the exclusive dealing
arrangements concerned some 17% of eligible customers and some 54% of electricity supplied
by ENEL in 2012. The decision was upheld on appeal in 2006 [29].

7. Alleged withholding of generation capacity

(a) E.on (2008) (EC)
In November 2008, the EC brought two cases to an end involving E.on, accepting
commitments offered [30]. The EC stated that it was concerned that E.on was abusing its
dominant position on the German electricity wholesale market through a strategy to withdraw
available generation capacity, with a view to raising electricity prices to the detriment of
consumers. The idea is that E.on may have withdrawn cheaper production capacity which it
owned to push the market price up to that determined by a more expensive plant in the merit
order of supply and then benefitted from the overall supply price obtained. The EC considered
that this may also have been complemented by a medium and long-term strategy of deterring
actual or potential competitors from entering the generation market and thereby limiting the
market volume in the electricity generation.

As regards the case on the German electricity balancing market, the EC was concerned that
E.on may have abused its dominant position on the market for the demand of secondary
balancing reserves in the E.on network area in two ways. First, by increasing its own costs by
favouring its own production affiliate and passing the costs on to the final consumer; and
second, by preventing power producers from other EU Member States from exporting
balancing energy into the E.on balancing market.

Whilst denying the alleged infringements, E.on offered to make significant divestments, some
5000 MW of E.on’s generation capacity (which appears to be from several plants in the merit
curve of supply cost). The EC considered that this removed both the ability and the incentive
for E.on to withdraw capacity, as alleged. E.on also offered to divest its German electricity
transmission system business consisting of its 380/220 kV-line network, the system operation
of the E.on control area and related activities. Again, this was a controversial settlement, given
the legislative debate on unbundling at the time.

(b) ENEL / Edipower (2010) (Italy)

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In December 2010, the ICA closed two parallel investigations, one for alleged abuse of
dominance by the ENEL group; the other for alleged collusion between Edipower and its
industrial shareholders, in the power generation capacity market in Sicily, Italy [31].

As far as the assessment of Art. 102 TFEU was concerned, ICA noted that ENEL owned 50% of
power generation capacity in Sicily and alleged economic or physical withholding of electricity
to create shortages and raise prices in peak demand hours, when ENEL held a pivotal position.

As far as the assessment under Art. 101 TFEU is concerned, ICA reached a preliminary
conclusion that Edipower and its industrial shareholders had agreed to withhold their
proportional capacity owned within the generation plant of San Filippo del Mela. Such plant
was also pivotal (i.e. capable of determining the electricity price level in Sicily) in at least 30%
of the hours scrutinised.

The Italian regulators considered that such conduct affected the setting of the relevant prices
in Sicily and also the national single electricity price (“PUN”), to the detriment of consumers
(based on the weighted average of zonal prices). In both cases, the ICA closed proceedings,
making binding the commitments offered by ENEL and Edipower.

In its preliminary assessment, the Italian regulator made explicit reference to the EC
investigation into E.on’s market conduct in Germany [32].

8. Divestments to resolve conflicts of interest

The EU SI identified as main fundamental deficiencies in the competitive structure of the
current electricity and gas markets the systematic, structural conflict of interest caused by
insufficient unbundling of networks from the competitive part of the sector [33]. Since then, as
noted above, in three cases the EC has accepted proposed undertakings, which include
unbundling and noted that such remedies were proportionate to the competition concern
claimed, to the extent required in proceedings under Art. 7 of Regulation 1/2003.

It may be useful to recap the three cases where this has come up so far:
In E.on (2008) (EC) [34], E.on committed to divest about 5000 MW of E.on’s generation
capacity and to divest its German electricity transmission system business consisting of its
380/220 kV-line network, the system operation of the E.on control area and related activities.
In RWE (2009) (EC) [35], the EC accepted RWE’s commitment to sell its entire German gas
transmission network, with a total length of approx. 4000 km, including the necessary
personnel and ancillary assets and services.
In ENI (2010) (EC) (noted above), the Italian gas incumbent committed to divest its current
shareholdings in companies related to international gas transmission pipelines to a suitable
and independent purchaser.

Some argue that the EC’s decisions to accept structural remedies in this way is
disproportionate, in view of the EU legislator’s decision in the Third EU Energy Liberalisation
Package to accept alternative models for unbundling of energy companies. However, others
argue that the EC is not responsible for what the party claimed to infringe will offer as a
remedy and that the EC’s review of proportionality in a settlement procedure is a limited one.
In other words, being a settlement, such a review does not have to be as precise as a full
infringement case under Art. 7 of Regulation 1/2003.

Beyond that, it appears that the EC, as a competition authority, considers that it may be
justified to require structural unbundling, through appropriate divestments, if necessary to
resolve specific competition concerns. Notably, the EC has referred to the proportionality of
these structural solutions to resolve the conflict of interest and also where monitoring
behavioural commitments may be difficult (although arguably, in some cases, that may be
possible through coordination with NERs).

In any event, the main point to note is the tendency to structural remedies including
commitments to divest in these EC cases.

9. Pricing abuses
There have been many EC, NCA and national court decisions with regard to pricing issues. The
main ones which we would highlight are as follows:

(a) RWE (2009) (EC)

Part of the EC decision against RWE noted above was based on the EC’s concern that RWE may

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have abused its dominant position by way of a margin squeeze [36].

The EC stated that RWE may have set its transmission tariffs at an artificially high level in
order to squeeze its competitors’ margin; and that such behaviour has the effect of preventing
even an equally efficient competitor from competing effectively on the downstream gas supply
markets.

The EC stated that its investigation had revealed that RWE had negative profit margins in its
downstream gas supply business, which contrasted with its overall profitable German gas
business, including its network business where, according to the available evidence, RWE
made considerable annual profits.

The EC suggested that the margin squeeze may also have been reinforced insofar as RWE may
have deliberately created an asymmetry in the cost structure between RWE and its
competitors. For instance, by using a rebate policy which, in fact, only benefitted RWE, or by
exempting itself from paying balancing costs, while other transport customers faced the risk of
high penalty fees within RWE’s transmission network.

As mentioned above, whilst denying the infringement, RWE offered a structural remedy,
namely to divest its entire existing high-pressure gas transmission network and this was
accepted.

(b) EdF Direct Energie (2007) (France)

In June 2007 the Conseil de la Concurrence imposed interim measures upon EdF, obliging EdF
to offer a wholesale contract proposing reasonable and non-discriminatory wholesale offers,
accessible to all retail suppliers, to new entrants in the French retail electricity market [37].

A new entrant, Direct Energie which supplies small professional customers, alleged that EdF
had abused its dominant position by: (i) a margin squeeze effect due to the excessive price of
the wholesale contract; (ii) discriminatory wholesale pricing conditions applied to third party
purchasers, as compared to the conditions to which EdF sells to its own retail subsidiary; (iii) a
refusal to offer long-term supply conditions, which would reflect EdF’s base-load nuclear
generation costs, with a refusal to implement the supply programme recommended by the
Energy Regulator; and (iv) a refusal to provide transparent and non-discriminatory access to
its nuclear programmes.

The Conseil accepted the margin squeezing claim, but rejected the others. EdF then was
invited to make remedy proposals, which it did. EdF made its wholesale offer publicly available
in July 2007, offering 1500 MW, i.e. twice as much volume as was then consumed by small
professional customers on the non-regulated market. The duration of contracts would be
between 10 and 15 years.

Interestingly, the Conseil appears to have cooperated with the French Energy Regulator
(“CRE”) considering CRE’s assessment of margin squeezing and consulting CRE in the
assessment of the EdF’s proposed remedies.

(c) Union Fenosa (2010) (Spain)

In Spain in recent years there have been a series of interesting decisions concerning the so-
called “market for technical restrictions”. One of these is the recent ruling of the Spanish
Supreme Court, concerning a SCA case against Union Fenosa [38].

By way of background, it should be noted that the SCA has brought cases against several
power generating companies, each of which was accused of abusing its market dominance in a
regional Spanish electricity “market caused by technical restrictions”.

The SCA claimed that the companies were offering unusually high prices in the initial bid for
the daily market for electricity, so as not to be selected for the daily market, thereby enabling
them to be called later to solve network constraints on the “markets for technical restrictions”,
i.e. the markets for supplying electricity in particular regions because of technical system
constraints on supply and/or other undersupply.

These cases are based on the special features of the Spanish energy market at the time, in
which power generation companies could submit one bid to sell electricity on the spot market,
which was matched with purchase offers beginning with the lowest offers, until the demand of
distributors and retailers throughout Spain was met. Power generation companies whose bids
were too high to be matched would then be called at a later stage to supply additional
electricity in areas were network constraints existed and shortages appeared. At the time, they
would then be paid on the basis of their initial bid in respect of the daily market.

The SCA imposed fines of some €901,520 on each company.

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These cases have raised all sorts of interesting arguments, such as:
The issue that the conduct concerned is on a market where a company may not be dominant
(the national daily spot market) with, however, effects in a market where it may be dominant
(a regional technical restrictions market);
to whether creating a shortage by bidding too high in such circumstances is abusive;
whether the prices concerned were in fact abusively high (measured against costs) given the
circumstances; and
whether the high daily spot market price could be objectively justified in the circumstances.

It appears that the Spanish system has now changed, allowing dual bids, which appears to
mean one in the daily spot market and another in the later technical restrictions market.

There are many interesting notes on the various stages of these cases in e-Competitions. For
example, concerning Viesgo Generación [39]; Iberdrola Castillon [40]; and Gas Natural [41].

In January 2010, the Spanish Supreme Court annulled a judgment of the Appellate
Administrative Court and quashed the SCA’s decision against Union Fenosa. More specifically,
the Supreme Court disapproved the cost calculation process carried out by the SCA,
concluding that the yardstick for whether prices were excessive should not be based on the
historical prices in the daily market, but rather on the usual costs in the technical restrictions
market.

The SCA was also found to have disregarded the distortions created by the obligation for
generators to submit only one price offer per period, notwithstanding the fact that this single
offer could be matched within two different markets involving different costs. Further, the
Supreme Court held that the SCA erred in not taking into account the uncertainty that
generators faced if their bids were not finally selected in the technical restrictions market.

(d) Gas supply procedures (2008) (Germany)

In December 2008 the German Competition Authority (the “Bundeskartellamt”, “BKA”)
announced that it had accepted commitments from gas suppliers in 29 cases out of 33
pending proceedings offering compensation to consumers worth €127 million [42].

The BKA alleged that the undertakings concerned abused their dominance by demanding
prices that differed significantly from those that would have been charged had effective
competition existed in consumer markets in 2007 and 2008. It appears that the BKA took the
view that the net revenue for both years was some 55%.

In most of the cases the BKA and the gas suppliers settled after they had made commitment
offers. The gas suppliers agreed to grant bonus payments and credits for their customers on
the next annual bill, amounting to 50% of the overall compensation, to postpone scheduled
price increases and/or reduce retail tariffs for the rest, and not to pass on scheduled increases
of wholesale prices for gas in 2008 [43].

(e) RWE (2006) (Germany)

In December 2006 the BKA issued a Statement of Objections to RWE, taking the view that it
had abused its dominant position on national electricity markets by including more than 25%
of the market price of CO2 emission certificates in its electricity prices. In the BKA’s view,
under normal competitive conditions, a passing-on of the price of emission certificates would
not be possible [44]. The energy providers argued, on the other hand, that prices for emission
certificates are opportunity costs which have to be factored into pricing (otherwise it would
make more economic sense to sell the certificates than use them).

The BKA appears to have accepted this to some extent, indicating that it intended to allow
RWE to include up to 25% of the certificates value as, due to regulatory obligations, only a
small part of the emission certificates actually could be sold on the market.

(f) Elsam (2008) (Denmark)

In March 2008 the Danish Competition Appeals Tribunal (“the Tribunal”) ruled on an appeal
against an excessive pricing decision made by the Danish Competition Council (“the Council”)
in June 2007 [45]. In that decision the Council found that Elsam had abused its dominant
position in the wholesale market for physical electricity in Western Denmark by using a bidding
strategy for the sale of electricity on Nord Pool Spot, which resulted in excessive prices for
some 1,484 hours between January 2005 and December 2006. This was the Council’s third
ruling against Elsam.

The Tribunal upheld the Council’s decision for the period January 2005 to June 2006, even
though Elsam’s strategy was based on previously given commitments not to submit bids
higher than the expected prices in neighbouring countries. However, the Tribunal annulled the

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Council’s decision as regards the second half of 2006, when Elsam had submitted bid prices
based on not exceeding its marginal costs, a strategy also provided for under the
commitments. The Tribunal found the Council’s reasoning insufficient.

It may also be of interest to note some decisions where NCAs rejected claims of excessive
pricing.

(g) Ekfors (2007) (Sweden)

As noted further below, there have been a number of cases in Sweden concerning a dispute
between Ekfors and two municipalities in the north of Sweden, Övertornea and Happaranda.

The two municipalities were supplied with electricity by Ekfors but, from 2004, were faced with
bills for the electricity they use in road and street lighting which had more than doubled. The
municipalities chose to pay a price they considered reasonable, while seeking to negotiate.
However, for the winter season 2006/07, Ekfors refused to supply until the municipalities
settled the outstanding amount.

The municipalities then applied to the Swedish Competition Authority (“SwCA”) alleging abuse
of dominant position. The SwCA rejected the complaint.

On appeal to the Market Court, the Court also denied the claim, reportedly holding that Ekfors
dominance was “weak” and that Ekfors and the municipalities were equally dependent on each
other. Further, it appears that a majority of the Court found that the claimed refusal to supply
had not been shown to restrict competition on the upstream or downstream markets. The
minority on the other hand found excessive pricing and refusal to supply [46].

Clearly a controversial and interesting case.

(h) Productschap Tuinbouw / Gas Terra (2009) (The Netherlands)

In June 2009 the Dutch Competition Authority (the “NMA”) ruled on a complaint by two
agricultural interest groups which are users of natural gas against alleged excessive pricing by
Gas Terra [47]. They also claimed that Gas Terra discriminated with different prices between
large and small scale users and between Dutch and non-Dutch users.

Interestingly, the NMa proceeded by commissioning an economic study by Frontier Economics

to benchmark the wholesale prices of Gas Terra. Considering the results, the NMa then noted
that Gas Terra’s prices were higher than the benchmarked prices for some hypothetical
competitors and/or periods, but found the differences not significant taking into account a
margin for error and that the differences were based on estimated (hypothetical) benchmark
prices. This was not enough to conclude that Gas Terra’s prices were excessive.

The NMa also did not consider that price discrimination had been established, given the
different natures of the ordering and prices concerned [48].

10. Discrimination and market partitioning

There were a large number of national decisions with regard to discrimination and market
partitioning, some involving high fines.

(a) RWE Transgas (2006-2007) (Czech Republic)

In August 2006 the Czech Competition Authority (the “CCA”) at first instance imposed a fine
on RWE Transgas, the dominant supplier of natural gas to retail distributors, equivalent to
some €13 million [49].

The following infringements had been found:

application of less advantageous terms to distributors not belonging to the RWE group;
market division through a clause prohibiting the sale of gas by retail distributors outside of a
specified territory; and
discrimination, consisting in the billing of the same fee for the storage of gas for different
categories of customers, despite the fact that the costs incurred in the provision of the
services differed between the categories.

This was in relation to a period between November 2004 and August 2006.

In March 2007 the appellate body of the CCA (the Chairman) confirmed the abuse of dominant
position, but reduced the fine to some €8,4 million, partly due to the fact that RWE Transgas
provided the CCA with cooperation after the first instance decision (i.e. by amending the
respective contracts concluded with non-consolidated distributors). The fine was also reduced

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due to dismissal of some of the allegations (geographical restriction of supply vis-à-vis RWE
companies (i.e. based on the intra-enterprise doctrine) and as regards the different prices for
storage of gas) [50].

RWE Transgas then challenged the CCA decision at the Regional Court in Brno, which quashed
it in October 2007, on the ground that unlawful behaviour may not be sanctioned twice.
Notably, it appears that the CCA increased the fine due to application of both national and EU
legislation in one infringement. This was found to amount to an infringement of the ne bis in
idem (unlawful double jeopardy) principle [51].

The CCA then filed an appeal to the Supreme Administrative Court, which overruled the
decision of the Regional Court in October 2008. The Court took the view that the CCA is
entitled to impose a fine for violation of both EC and Czech law at the same time. Such a
parallel application of EU and national competition law was not excluded by the enforcement
system in Regulation 1/2003, nor was it contrary to the European Convention of Human
Rights, ne bis in idem applying rather to cases of two distinct proceedings, not the parallel
application of EU and national law in one proceeding. Since EU and national competition law
pursue different objectives, concurrent application was also possible. The case was remitted to
the Regional Court for further procedure [52].

(b) Mazeikiu Nafta (2005-2009) (Lithuania)

In December 2005 the Lithuanian Competition Authority (“LCA”) imposed a fine equivalent to
some €9.27 million on AB Mazeikiu Nafta (“MN”), the national oil refinery, for discriminatory
pricing on the market for ex-refinery sales of diesel and on the market for ex-refinery sales of
petrol with a geographical scope encompassing Lithuania, Latvia and Estonia [53].

MN was found to have infringed by:

economically unjustified and therefore discriminatory pricing;
forcing its biggest customers into signing annual contracts with a minimum purchase
obligation (equivalent to loyalty-inducing target rebates); and
territorial discrimination, as Lithuanian customers had been charged higher prices than those
in Latvia and Estonia.

The investigation concerned the period 2002-2004.

In June 2007 the Vilnius District Administrative Court annulled the decision on several
procedural and substantive grounds including disagreement with LCA’s product and geographic
market definition [54].

Then, on further appeal, in December 2008, the Lithuanian Supreme Administrative Court held
that no significant procedural violations had occurred which justified the annulment of the
LCA’s decision. This included a finding that Article 11(4) of Regulation 1/2003 does not confer
rights on private persons, so any failure of the LCA to coordinate with the EC before issuing its
decision was irrelevant.

However, on the substantive questions the Court identified a number of factual circumstances
and arguments raised by MN, which the LCA had failed to consider in its infringement decision,
notably, a failure to analyse the conditions of competition beyond the territories of Lithuania,
Latvia and Estonia. The Court also questioned the LCA’s assessment on barriers to entry to the
market. The Supreme Administration Court therefore ruled that the original infringement
decision was null and void, but asked the LCA to re-investigate.

The LCA re-investigated the case beginning in January 2009 and maintained its opinion
concerning the abuse by MN of its dominant position in the market.

In December 2010 the LCA narrowed the geographic market of the case to the territory of the
Republic of Lithuania, and concluded that the pricing policy employed by MN (now AB Orlen
Lietuva) was designed to restrict the entry of competitors into the Lithuanian market. Non-
compete obligations, MN’s annual loyalty system and certain rebates were found unlawful, the
latter involving discrimination between certain undertakings operating in the same market. All
of this was found to be to avoid competition from imported diesel from the East and petrol
from the West.

As a result, the LCA fined AB Orlen Lietuva (the former Mazeikui Nafta) the equivalent of some
€2.38 million. In April 2011, the Vilnius Regional Administrative Court upheld this
decision [55].

(c) ENEL / ENEL Produzione (2006) (Italy)

This case arose from a complaint by the Italian Energy Regulator concerning certain anomalies
in trends of the national price in June 2004 and January 2005. The ICA found that ENEL

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enjoyed significant market power on the relevant market for the wholesale supply of electricity
in the four macro-areas covering the whole territory of Italy, namely the North, the South,
Sicily and Sardinia.

The ICA found that ENEL might have used its market power, which made it indispensable in
certain areas, to determine the flow of imports and exports of electricity with the other macro-
areas and to maintain relevant differences in the price amongst the different areas. This would
have created a so-called “leader-followers” model, in which ENEL had the role of price-maker
in all the different macro-areas, while its competitors were all price-takers. The idea was
therefore that ENEL was extending its dominant position, using its market power [56].

ENEL offered to settle the case, whilst denying any infringement. ENEL proposed (i) to sell
virtual capacity in the South macro-area; (ii) to determine an auction procedure in order to
establish the sales price of the virtual capacity; and (iii) to fix a two year period for the release
of the capacity. These commitments were not considered sufficient (after consultation with the
Italian Energy Regulator).

Then, in a second proposal, ENEL committed: (i) to raise the amount of virtual capacity it
would sell to a total amount of 1000 MW in 2007 and 700 MW in 2008; (ii) to reduce the sales
price of virtual capacity; (iii) to establish limitations on the maximum amount which could be
allotted to each bidder; (iv) to provide a draw mechanism in case demand exceeds supply
offer; and (v) to distinguish the virtual capacity to be sold in different products, namely base-
load (650 MW), peak (350 MW) and off-peak (350 MW).

It appears the idea was to eliminate the pivotal role enjoyed by ENEL in the South macro-area
and to reduce that role in the North macro-area, while giving competitors access to sources of
supply at more competitive conditions than those in the Italian electricity trading market (on
which ENEL was found to have the ability to determine prices). These were accepted by ICA.

(d) Enemalta (2007) (Malta)

In this case the Maltese Commission for Fair Trading endorsed the decision of the Maltese
Office of Fair Trading, according to which Enemalta Corporation had abused its dominance in
the market for the provision of fuels in Malta, by applying discriminatory pricing policies to
equivalent transactions with its agents and distributors [57].

In particular, by allowing the complaining distributor (Cassar Fuels) only a 14-day credit term
for payment, while other agents and distributors in the same market level were allowed a 60-
day credit term for payment.

An interim order was issued whereby Enemalta Corporation was provisionally restrained from
allowing the complainant shorter credit terms than those generally allowed to other
undertakings.

11. Failure to provide or late provision of technical information

In the Final Report of its EUSI, the EC identified a general lack of transparency in market
operations and stated that access to market information should be further enhanced [58].
There have been several interesting NCA decisions addressing such lack of transparency and
access to information.

(a) Distribution Companies (2009) (Spain)

In Spain distribution companies are obliged to maintain a database with information on their
power access points (so-called “SIPS”). Access to these SIPS should be made available to any
interested commercialisation company.

In April 2009 the SCA, further to proceedings prompted by a complaint by Centrica, fined five
distribution companies (Endesa, Iberdrola, Union Fenosa, Electra de Viesgo and
Hidrocantrabrico) some €36.6 million (in total).

The SCA found that these companies had abused their dominant positions in power
distribution, by infringing their obligation to grant massive (i.e. general) and unconditional
access to their SIPS, thereby reducing the sales capacity of competitors on the downstream
market for power commercialisation, to the benefit of their own related sales companies. The
distribution companies were found to be requiring specific applications as regards potential
clients for such SIPS data, which was making it more difficult and less efficient for third parties
to compete in the downstream market. Such conduct also involved discrimination as compared
to the distribution companies’ own commercialisation companies [59].

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In 2009 and 2010 there were also two interesting Italian decisions relating to the failure to
provide information or late provision of information and data, which were alleged to hinder
competition. Both were resolved by commitments.

(b) ENEL/Exergia (2009) (Italy)

In December 2009 the ICA concluded a proceeding accepting commitments from ENEL and
two of its subsidiaries, ENEL Distribuzione and ENEL Servizio Elettrico [60].

Investigations were launched following a complaint from Exergia which reported delays, errors
and omissions by ENEL companies, when transferring customer-related, technical and fiscal
data which were necessary for traders to operate in the market for retail sale of electric power
to non-residential customers.

ENEL held a monopoly on the essential information required by new entrants. The
commitments established a method for controlling, in advance, the quality of personal data
provided by operators from the ENEL group, thus preventing any deterioration of the
information.

(c) Distribution companies/Sorgenia (2010) (Italy)

In September and October 2010 the ICA concluded five proceedings pursuant to Art. 102
TFEU, by making mandatory the commitments proposed by several vertically-integrated
companies (A2A, Acea, Italgas, Hera and Iride) operating in the markets for electricity and gas
sales and distribution.

The investigations were preceded by a complaint from Sorgenia, an operator which is not
vertically-integrated, which claimed the distribution companies were using inefficient
procedures and obstructive behaviour to raise competitors’ costs in entering the retail markets
for gas and electricity, in particular by making switching difficult for customers (for example,
by delaying the release of data). Discrimination against sellers which were not integrated with
the local distributor was established on a preliminary basis [61].

(d) SP Manweb (2006) (UK)

In October 2005 the UK Gas and Electricity Market Regulator (“Ofgem”) accepted
commitments offered by SP Manweb which were intended to ensure that point of connection
(“POC”) information and design approval are provided within recommended timescales to non-
affiliated independent connection providers (“ICPs”).

An ICP had complained that SP Manweb had engaged in anti-competitive behaviour when
providing non-contestable electricity connection services, affecting the market for the
provision of such services, by delaying the provision of POC information to ICPs by SP
Manweb’s affiliated connection provider Core and by discriminating in the supply of such
information. SP Manweb also undertook to offer all ICPs the same access to its IT systems as
currently enjoyed by Core [62].

12. Making access conditional on unrelated obligations

The NCAs have also adopted a number of decisions which do not have their counterpart in
parallel EC decisions, focussing often on exploitative abuses, such as where a company has
abused its dominant position by conditioning access to its transmission network to unrelated
obligations.

(a) Eustream (2010) (Slovakia)

In June 2010 the Slovak Regional Court upheld the decision of the Slovak Competition
Authority (the “SLCA”) in 2008. The SLCA which had imposed a fine of SKK 98.9 million (some
€3.28 million) on Eustream for abuse of dominant position, by enforcing unfair trade
conditions, unrelated to the subject matter of agreement with respect to the conclusion of
agreements in the gas sector [63].

In order to connect Gas Trading’s distribution network in an industrial park to Eustream’s

transmission system, Eustream requested to purchase of the Gas Trading’s connection
infrastructure. Eustream set and offered a purchase price equal to the fee for access to
Eustream’s system. Eustream argued that it needed to ensure a safe and reliable operation of
the transmission system and to maintain a situation where none of the distribution network
operators that were connected to the transmission system owned connection infrastructure.

The SLCA found such an explanation unsupported both in law and fact and that this conduct

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was an exploitative abuse.

(b) Bulgaria Elektrorazpredelenie (2010) (Bulgaria)

A second decision on this sort of abuse was adopted in June 2010 by the Bulgarian
Competition Authority (“BCA”) [64].

The BCA fined electricity supplier EVN Bulgaria Elektrorazpredelenie AD (“EVN”) for abusing its
dominant position on the electricity supply market, by making the conclusion of the contract
for access rights with Yana (a textile manufacturer) conditional on the acquisition of Yana’s
cable installation, called Yana3.

Yana3 connects EVN’s hub station to Yana’s textile manufacturing plant and also to third
parties. EVN needed to make certain modifications to Yana’s installation for that supply. As a
result, EVN sought to acquire the installation.

The State Commission for Energy and Water Regulation found that Yana3 formed an
indispensable part of EVN’s distribution network, insofar as it connected EVN not only to Yana
itself, but also to other consumers. The State Commission therefore ruled that Yana could not
refuse EVN’s access to these facilities.

However, the BCA found no relationship between the conclusion of the access contract, which
was aimed at compensating Yana for the usage of its Yana3 installations by EVN and the
acquisition of those installations by EVN. To link the two was an exploitative abuse of EVN’s
position as electricity supplier.

13. Making supply conditional on the payment of invoices

There have been a number of decisions in which NCAs held that it was an abuse of dominance
to make the supply of gas or electricity conditional upon certain payment terms, such as the
payment of the bills in arrears, due by a different customer supplied at the same connection.

(a) Union Fenosa (2011) (Moldova)

In February 2011 the Moldovan Competition Authority found that Union Fenosa had abused its
dominant position on the market for the supply and distribution of electricity by including an
automatic notice of disconnection in monthly invoices [65].

(b) Various decisions (2010/2011) (Bulgaria)

Similarly, the BCA has issued several decisions holding that refusals to supply electricity
because of payment issues amounted to an abuse of dominance. For example, where this was
due to the existing debts of the previous owner of the facility (see E.on Bulgaria Sales [66],
EVN Bulgaria Elektrosnabdiavane [67].

(c) ENEL Distribuzione (2007) (Italy)

In October 2007 the ICA took a similar position. It closed proceedings against ENEL
Distribuzione for making the activation of a new supply contract conditional upon the payment
of the bills in arrears due by a different customer supplied at the same connection point [68],
after ENEL offered commitments to resolve that issue. ENEL offered internal rules that
activation had to be related to the new customer’s position only, with related internal
monitoring [69].

(d) Other
See also Macedonian decisions finding that charging for invoices was abusive when the cost of
electricity supply had been regulated and capped at a price inclusive of the invoice
(Elektrostopanstvo) (2009; 2010) (Macedonia) [70].

14. Sub-markets of electricity supply

There have also been a number of interesting decisions reported in e-Competitions on sub-
markets of the electricity supply sector. Notably, in Sweden and Hungary there have been
decisions on the markets for street lighting services.

(a) Ekfors Kraft (2010) (Sweden)

In February 2010 the SwCA issued an interim order and imposed an obligation on Ekfors Kraft

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to provide access to its electricity mains supply [71]. Ekfors had refused to provide such
access to the city of Haparanda, since Haparanda decided to erect its own network of street
and road lights in the municipality.

The refusal was held to amount to an abuse of a dominant position on the market for
providing electricity mains supply for the transmission of electricity in the area of the
concession right, denying the city’s entry into the local market for street lighting services. The
concession rights to electricity mains supply in Haparanda were found to confer upon Ekfors a
monopoly for these services and the electricity mains was found to constitute an essential
facility.

The Market Court upheld the SwCA’s interim order, confirming that unresolved economic
disputes (described above) might constitute an objective justification to refuse access to an
essential facility. However, the burden of proof in such a case on the dominant company, which
Ekfors had not discharged, because it had not shown the details of the alleged debt owed by
the city, or substantiated its claim that the city would not pay future debts.

(b) Demasz (2008) (Hungary)

Demasz is an electricity provider holding a monopoly for electricity supply to municipalities and
other consumers in the southern part of Hungary. It also held a strong position on three
electricity sub-markets, namely the markets for maintenance, modernisation/improvement
and operation of street lighting systems. This derived from the legal requirement that its
approval was necessary for plans regarding the modernisation of street lighting systems.
Following partial liberalisation, alternative service providers were allowed to enter the sub-
markets, while Demasz retained its monopoly on the electricity supply market.

The HCA investigated various practices of Demasz and found that Demasz had abused its
dominant position in the supply market by setting out extra conditions, beyond technical-
safety considerations, such as agreements on operational and ownership issues, for the
alternative service providers in the sub-markets, in order to approve their construction plans
regarding the modernisation of street lighting systems [72].

Demasz was also found to have concluded agreements with more favourable conditions with
municipalities where Demasz modernised the street lighting systems, as compared to
agreements with other municipalities, with the aim of preserving Demasz’s monopoly position
in the other sub-markets. Further, Demasz was found to have had entered into long-term
agreements with municipalities before the partial liberalisation, with high penalties restricting
or at least restraining consumers from concluding new agreements with other service
providers. The penalties were considered to block the entry of alternative service providers to
the market.

In September 2008, the HCA’s decision was upheld by the Hungarian Court of Appeal.

15. Specific markets

The NCAs have adopted a number of decisions on specific energy product or service markets.

(a) Jet fuel (2008/2011) (Various)

The competition issue of pricing and/or discriminatory practices in relation to the supply of jet
fuel at airports, or access to related infrastructure, has been well-known for many years.
There are several recent examples reported in e-Competitions. For instance, in Austria [73], in
Croatia [74] and in Lithuania [75].

(b) Motor Fuels (2010) (Russia)

In Russia there has also been a case concerning the wholesale supply of motor fuels and
aviation fuel in which the Russian Competition Authority found that four vertically-integrated
fuel suppliers abused their collective dominant position by charging higher and discriminatory
prices to independent firms than to their own affiliates.

In May 2010, as regards one of these companies, TNT-BP, this ruling was upheld by the
Russian Supreme Commercial Court [76].

(c) Monoethylene Glycol / Radiator Liquids (2006) (Poland)

In December 2006 the Polish Competition Authority (“PCA”) issued a decision fining PKN Orlen
for the abusive supply of its radiator liquids, based on monoethylene glycol, for which it was
the dominant supplier, at excessively low prices close to the cost of production, making it

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difficult for customers to compete profitably with PKN Orlen in the market for radiator liquids.
The infringement finding appears to reflect both predatory pricing and margin squeezing
concerns [77].

(d) Electrical connection works (2006) (Spain)

In December 2006 the SCA took a decision finding that Endesa, the sole power distributor on
the island of Majorca, had abused its dominance position. Endesa was found to have been
using the technical information provided for connection works in order to link to its power
supply in order to make offers to perform the connection works which involved potentially
higher costs. The idea was that Endesa had used its dominant position in power supply
abusively to obtain unfair advantages in the market for connection works, where it competed
with other electrical installers [78].

(e) Metering services (2008-2011) (UK and others)

The competition issues related to metering services (pricing and access) have been well-
known for many years. There are various cases reported in e-Competitions. For example, in
February 2010 the English Court of Appeal upheld a ruling of the UK Competition Appeal
Tribunal that Ofgem had found correctly that National Grid abused its dominant position in the
provision of domestic gas meters through agreements restricting the number of National Grid
installed meters which a gas provider was allowed to replace with third party meters in a given
year. Ofgem’s original fine was £41.6 million. The Court of Appeal reduced that to £15 million,
after the High Court had already reduced the fine to £30 million [79].

In January 2007 Ofgem also found that EDF Energy (“EDFE”) had not abused a dominant
position by discontinuing the provision of meter data services (collection, processing and
aggregation of data from certain types of electricity meter) to other suppliers of electricity.

EDFE was found not to be dominant because, although it had high market share in certain
areas, competition from other providers of such services from outside these areas was
occurring, so the market appeared wider in geographical scope and potential entry was also a
competitive factor [80].

(f) LPG (2010) (Italy)

In March 2010 the ICA took a decision concerning a ten year long cartel in the supply of liquid
petroleum gas (“LPG”) involving ENI, Butan Gas and Liquigas. The case was based on a
leniency application by ENI and the ICA’s fact-finding. Initially the case concerned supply in
cylinders in Sardinia, but this was later expanded to a nationwide case involving cylinders and
small tanks. ENI was given immunity. The fine on Butan Gas was €4.8 million and that on
Liquigas was €17.2 million [81].

(g) Pipes for gas supply (2011) (Greece)

In March 2011, the Greek Competition Authority (the «GCA«) fined the gas supply Company of
Thessaloniki, EPA Thessaloniki and the Gas Supply Company of Thessaly, EPA Thessalia for
abuse of dominance in the market for licensing of natural gas facilities under Greek
Competition law [82]. The case was brought to the attention of the GCA in December 2008 by
a complainant, DIMCO, a company active in the supply of gas pipes.

EPA Thessaloniki and EPA Thessalia have the exclusive right to supply gas to “small”
customers located within their concession areas for a period of 30 years starting in 2002.
Thus, they also have a monopoly position in the market for licensing of indoor natural gas
installations.

The GCA found that, from February 2006 until March 2011, EPA Thessaloniki and EPA
Thessalia discriminated without any objective justification against flexible steel gas pipes for
indoor gas installations. They would not accept such pipes, but only conventional inflexible
pipes and copper pipes, despite the fact that the flexible pipes conformed with the relevant
technical regulations. The GCA found that this conduct distorted competition on the
neighbouring market for the supply of pipes for internal gas installations, since it put DIMCO,
which supplies flexible steel pipes, at a disadvantage. The conduct also harmed final natural
gas consumers because it limited their choice.

The GCA imposed a €419,781 fine on EPA Thessaloniki and a fine of €201,201 on EPA
Thessalia. Further, the GCA threatened daily penalty payments of €5,000 until the two
companies cease their anti-competitive practices.

The GCA also imposed on EPA Thessaloniki a fine of €20,000 for late reply to one of GCA’s
requests (there was a delay of 45 days after the deadline expiry); and a fine of €15,000 for
providing incomplete information.

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Finally, the GCA forced both companies to inform installation engineers by press release that
flexible steel pipes can be used in indoor natural gas installations in accordance with the
applicable technical regulations.

16. State measures hampering the development of competition

In March 2008, the EC adopted a decision finding that the Hellenic Republic had infringed Art.
86, in conjunction with Art. 82 of the EC Treaty, by granting and maintaining in force quasi-
monopolistic rights giving the public undertaking Public Power Corporation SA (“PPC”)
privileged access to lignite exploitation, and accordingly to lignite-based electricity. This was
found to assure PPC privileged access to the cheapest available fuel for electricity production in
Greece. The Hellenic Republic had been systematically granting rights to exploit nearly all
medium and large lignite deposits in Greece to PPC [83].

The EC found that such conduct gave PPC the possibility to maintain a dominant position in the
wholesale electricity market at a level close to monopoly, by excluding or hindering market
entry by newcomers. The decision called upon the Hellenic Republic to propose effective
measures and ensure that around 40% of exploitable reserves in Greece are made available to
competitors of PPC.

In August 2009 the EC adopted a decision making binding the measures proposed by the
Hellenic Republic, which included in particular the granting of exploitation rights to new Greek
lignite deposits of Drama, Elassona, Vevi and Vegora through tender procedures to entities
other than PPC. These tender procedures were to be launched and implemented at the latest
within six months from the notification of the decision, while allocation rights were to be
granted to the successful bidders at the latest within 12 months of the notification of the
decision.

In January 2011, the EC invited comments on new proposals by the Greek Government to
comply with the 2008 Greek Lignite decision [84]. Greece has asked for a review of the EC’s
earlier decision due to a new energy policy. Greece plans to continue with existing lignite
mines and not to open up new mines. As an alternative measure to the previously promised
access to new mines, the Greek Government proposes to give competitors of PPC access to
40% of lignite-fired generation through drawing rights in existing lignite-fired power plants of
PPC. Further, participants would be offered participation in future power plants using currently
available lignite.

Footnotes
[1] The views expressed in this paper are personal and do not necessarily reflect those of Wilmer
Cutler Pickering Hale and Dorr LLP. References to the European Commission’s website are to DG
Competition’s specific competition “page”: http://ec.europa.eu/comm/competitio....

[2] Previously Article 82 of the EC Treaty.

[3] Council Regulation (EC) n° 1/2003, of 16 December 2002, on the implementation of the rules
on competition laid down in Articles 81 and 82 of the Treaty (OJEU L 1, 4 January 2003, p. 1-25).

[4] European Commission, 11 October 2007, Case 37966, Distrigas, EC Press Release (“IP”)
IP/07/1487 and MEMO/07/407 and 15 January 2008, Case 37966, Distrigas, OJ EU C9/8; European
Commission, 17 March 2010, Case 39386, EdF, IP/10/290; OJ EU C 133/5, 22 May 2010; European
Commission, 29 September 2010, Case 39315, ENI, IP/10/1197; OJ EU C352/8 and 23 December
2010, Case 39315, ENI; European Commission, 26 November 2008, Cases 39388 and 39389, E.on,
IP/08/1774; OJ EU C36/8, 13 February 2009; E.on, Case 39317, IP/10/494, 4 May 2010; OJ EU
C278/9, 15 October 2010; E.on/GdF, Case 39401, IP/09/1099, 8 July 2009; OJ EU C248/5, 16
October 2009; European Commission, 3 December 2009, Case 39316, GdF Suez, IP/09/1872 and
MEMO/09/536; OJ EU C57/13, 9 March 2010; European Commission, 18 March 2009, Case 39402,
RWE, IP/09/410; OJ EU C133/10 and European Commission, 12 June 2009, Case 39402, RWE; and
European Commission, 14 April 2010, Case 39351, Svenska Kraftnät, IP/10/425; OJ EU C142/28, 1
June 2010.

[5] EU Energy Sector Competition Inquiry, Final Report, Frequently Asked Questions, MEMO/07/15, 10
January 2007, available on the EC’s website.

[6] European Commission, 11 March 1998, Case 34801, FAG Flughafen Frankfurt, OJ EU L72/30.

[7] See Ricardo Cardoso de Andrade, Oliver Koch, Sandra Kijewski, Patrick Lindberg, Karoly
Nagy, The European Commission renders legally binding commitments offered by French and German

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incumbent gas operators concerning long-term capacity bookings (GDF, E.ON), 3 December 2009, e-
Competitions, n° 34851.

[8] TAG was sold to Cassa Depositi e Prestiti, an Italian company; TENP/Transitgas to Fluxys, a
Belgian company.

[9] See Luciano Vasques, Silvio Nobili, The Italian Competition Authority fines ENI with the highest
fine ever imposed to a single company in Italy for abuse of dominant position in wholesale supply of
natural gas on the basis of Art. 82 EC (Trans Tunisian Pipeline Company-Eni), 15 February 2006, e-
Competitions, n° 501.

[10] Italian Supreme Administrative Court, 20 December 2010, ENI/Trans-Tunisian Pipeline,

Judgment No 9306.

[11] See Philippe Chauve, Elzbieta Glowicka, Martin Godfried, Edouard Leduc, Stefan Siebert,
The European Commission accepts commitments offered by Swedish incumbent electricity operator in
the electricity transmission market (Svenska Kraftnat), 14 April 2010, e-Competitions, n° 34860.

[12] See Attila Komives, Tunde Gonczol, The Hungarian Competition Office accepts objective
justification defence in an abuse of dominance case in the electricity sector (DEMASZ/DHE), 14
February 2008, e-Competitions, n° 27240.

[13] (9/2008, e-C 26197)

[14] See Florian Wagner-von Papp, The German Federal Court of Justice clarifies that access to an
essential facility does not require a dominant position in the up- or downstream market in the
electricity sector (Arealnetze), 28 June 2005, e-Competitions, n° 488.

[15] We also note a Polish case of refusal to supply gas network access to a competitor to import gas
into Poland (PGNIG/Bartimpex (2009) (Poland), (Aleksander Stawicki, The Polish Supreme Court
decides on the validity of the refusal of the gas network access (Bartimpex), 15 July 2009, e-
Competitions, n° 27843); and a Turkish case of refusal to give access to an electricity transfer and
distribution network to a competitor (Enerjisa and Toros/CEAS (2007) (Turkey) (Remy Fekete, The
Turkish Competition Board fines 5 M euro an abuse of dominant position by applying the "essential
facility" doctrine in the energy distribution sector (Enerjisa and Toros/CEAS), 8 February 2007, e-
Competitions, n° 13997) both with debate as regards competition and sectoral regulation jurisdiction.
See also the short note concerning a case of access to essential facilities in Spain, Aitor Montesa
Lloreda, Angel Givaja Sanz, The Spanish Competition Authority fines the leading gas supplier for an
abuse of dominant position (Gas Natural 2), 26 March 2009, e-Competitions, n° 28367.

[16] See Ricardo Cardoso de Andrade, Oliver Koch, Sandra Kijewski, Patrick Lindberg, Karoly
Nagy, The European Commission renders legally binding commitments offered by French and German
incumbent gas operators concerning long-term capacity bookings (GDF, E.ON), 3 December 2009, e-
Competitions, n° 34851.

[17] See Ricardo Cardoso de Andrade, Oliver Koch, Sandra Kijewski, Patrick Lindberg, Karoly
Nagy, The European Commission renders legally binding commitments offered by French and German
incumbent gas operators concerning long-term capacity bookings (GDF, E.ON), 3 December 2009, e-
Competitions, n° 34851.

[18] See IP/10/1197, 29 September 2010.

[19] See Oliver Koch, Karoly Nagy, Ingrida Pucinskaite-Kubik, Walter Tretton, The European
Commission adopts a commitment decision concerning a possible abuse of a dominant position in the
German gas transmission markets (RWE), 18 March 2009, e-Competitions, n° 35038.

[20] See Francesca Morra, The Italian Competition Authority accepts commitment from the energy
incumbent to remedy concerns about its position in gas markets (ENI), 6 March 2006, e-Competitions,
n° 13672.

[21] See Valerio Torti, The Italian Competition Authority closes proceedings against the gas
incumbent for alleged breach of Art. 82 EC by accepting commitments in the sector of regasification
facilities without imposing sanctions (ENI), 12 March 2007, e-Competitions, n° 13342.

[22] See Margarita Fernandez, Spanish Court annuls the NCA’s decision having imposed on the
basis of Art. 82 EC an Eur. 8 millions fine for impeding third parties access to regasification capacities
(Gas Natural), 13 March 2007, e-Competitions, n° 14012;Luis Agosti, A Spanish Court revokes the
NCA’s decision on an abuse of dominant position due to the absence of anticompetitive effects on the
market regarding access to liquid natural gas importing infrastructures (Gas natural), 13 March 2007,
e-Competitions, n° 14793 and Carolina Luna, The Spanish Supreme Court holds that the national
High Court erred in law as regard the concept of dominance (Enagas, Gas Natural Comercializadora), 1
June 2010, e-Competitions, n° 33575.

[23] See Nicolas Bessot, Maciej Ciszewski, Augustijn Van Haasteren, The European Commission

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makes legally binding commitments proposed by French incumbent electricity operator in long term
contracts case (EDF), 17 March 2010, e-Competitions, n° 34858.

[24] See IP/07/1487 and MEMO/07/407; 11 October 2007 (see above).

[25] See Nicolas Bessot, Maciej Ciszewski, Augustijn Van Haasteren, The European Commission
makes legally binding commitments proposed by French incumbent electricity operator in long term
contracts case (EDF), 17 March 2010, e-Competitions, n° 34858.

[26] See Charlotte-Mai Doremus, Noelle Lenoir, Dan Roskis, The French Competition Council
orders the electricity incumbent to amend early termination clauses in supply contracts (EDF), 25 April
2007, e-Competitions, n° 13724 and Charles Saumon, The French Competition Council imposes
interim measures to the incumbent to safeguard competition on the electricity supply market
requesting modification of termination of exclusivity clause (KalibraXE/EDF), 25 April 2007, e-
Competitions, n° 13746.

[27] See Gry Hoirup, The Danish Competition Council approves natural gas supply agreement under
Art. 81 and 82 EC with commitments to an early termination of the exclusive supply clause and
prohibition of such clause in future contracts (DONG and HNG/MN), 21 December 2005, e-
Competitions, n° 418.

[28] See Michele Giannino, The Italian Competition Italian fined the incumbent for abusing its
dominant position in the electricity markets (Enel Trade-Clienti Idonei), 27 November 2003, e-
Competitions, n° 14764.

[29] Tribunale Amministrativo Regionale, 20 October 2006, Judgment No 10678.

[30] See Karoly Nagy, Philippe Chauve, Martin Godfried, Stefan Siebert, Kristof Kovacs,
Gregor Langus, The European Commission approves structural remedies offered by German
electricity operator in order to remove suspected infringements of EU Article 102 concerns in the
German electricity wholesale and balancing markets (E.ON), 26 November 2008, e-Competitions, n°
35136.

[31] See Ernesto Razzano, The Italian Competition Authority accepts and enforces commitments
offered by the main energy companies active in the Sicily electricity wholesale market (Enel, Tolling
Edipower), 22 December 2010, e-Competitions, n° 34257.

[32] See Karoly Nagy, Philippe Chauve, Martin Godfried, Stefan Siebert, Kristof Kovacs,
Gregor Langus, The European Commission approves structural remedies offered by German
electricity operator in order to remove suspected infringements of EU Article 102 concerns in the
German electricity wholesale and balancing markets (E.ON), 26 November 2008, e-Competitions, n°
35136.

[33] EU SI, cited above, p.11, para. 11.

[34] See Karoly Nagy, Philippe Chauve, Martin Godfried, Stefan Siebert, Kristof Kovacs,
Gregor Langus, The European Commission approves structural remedies offered by German
electricity operator in order to remove suspected infringements of EU Article 102 concerns in the
German electricity wholesale and balancing markets (E.ON), 26 November 2008, e-Competitions, n°
35136.

[35] See Oliver Koch, Karoly Nagy, Ingrida Pucinskaite-Kubik, Walter Tretton, The European
Commission adopts a commitment decision concerning a possible abuse of a dominant position in the
German gas transmission markets (RWE), 18 March 2009, e-Competitions, n° 35038.

[36] See Oliver Koch, Karoly Nagy, Ingrida Pucinskaite-Kubik, Walter Tretton, The European
Commission adopts a commitment decision concerning a possible abuse of a dominant position in the
German gas transmission markets (RWE), 18 March 2009, e-Competitions, n° 35038.

[37] See David Sevy, The French competition authority imposes an obligation upon the electricity
incumbent to offer a wholesale contract to new entrants (Direct Energie/EDF), 24 July 2007, e-
Competitions, n° 14000.

[38] See Jaime Garcia-Nieto, Herve Ajouc, The Spanish Supreme Court annulls a judgment of the
Appellate Administrative Court and quashes a Decision of the Spanish Competition Authority that
imposed a substantial fine on several power generating companies for abusing their dominant position
in the Spanish electricity market for technical restrictions (Union Fenosa), 27 January 2010, e-
Competitions, n° 30709.

[39] See Casto Gonzalez-Paramo, The Spanish Competition Court fines a power generating
company for abusing its dominant position by artificially raising the prices of the Spanish electricity
pool (Viesgo Generacion), 28 December 2006, e-Competitions, n° 13144 and Luis Agosti, Atilano
Jorge Padilla, The Spanish NCA fines Eur. 2,5 M an electricity producer for abusive prices in the
electricity generation schedules adjustment market (Viesgo Generacion), e-Competitions, n° 13219.

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[40] See Aitor Montesa Lloreda and Angel Givaja Sanz, The Spanish Competition Authority fines
for the third time an electricity utility for excessive high prices (Iberdrola Castellon), 8 March 2007, e-
Competitions, n° 13345 and Luis Moscoso del Prado Gonzalez, The Spanish Competition Authority
fines electric company for abusing pricing in the electricity technical restrictions market (Iberdrola), 14
February 2008, e-Competitions, n° 16059.

[41] See Casto Gonzalez-Páramo, The Spanish Competition Authority fines a power company for
excessive pricing in the technical restrictions market (Gas Natural), 25 April 2008, e-Competitions, n°
18720.

[42] See Sebastian Peyer, The German Federal Cartel Office settles a number of proceedings against
gas suppliers for alleged abuse of dominance and accepts commitments offering compensation to
consumers worth Eur. 127 M (Gas price procedures), 1 December 2008, e-Competitions, n° 26132.

[43] See also the notes on recent German legislation against excessive prices in the energy sector in
Dr. Frank Rohling, Bertrand Guerin, Germany reforms the Competition’s Restraints Act in order to
fight against price abuses in the energy and food trade sectors, 21 December 2007, e-Competitions,
n° 15530 and Dr. Frank Rohling, The German legislative targets excessive pricing by energy
suppliers in a new draft law (Entwurf eines Gesetzes zur Bekampfung von Preismissbrauch im Bereich
der Energieversorgung und des Lebensmitttelhandels), December 2006, e-Competitions, n° 12643.

[44] See Dr. Frank Rohling, The German Federal Cartel Office regards the inclusion of more than
25% of the market prices of CO2 emission certificates within the electricity prices as an abuse of
dominant position pursuant to Art. 82 EC (CO2 National Allocation Plans), 20 December 2006, e-
Competitions, n° 12732.

[45] See Jens Munk Plum, The Danish competition appeals tribunal partly confirms and partly annuls
a decision of the NCA’s on excessive pricing in the wholesale market for physical electricity in Western
Denmark (Elsam III), 3 March 2008, e-Competitions, n° 21224.

[46] See Anders Flood, Andreas Jasper, The Swedish Market Court rejects action for alleged abuse
of dominant position in the electricity sector (Ekfors), 15 November 2007, e-Competitions, n° 15760
and Jakob Lundstrom, Mina Lindgren, The Swedish Market Court holds that the electricity network
for municipalities street and road lighting is not an essential facility and rejects alleged abusive refusal
to supply and price increase (Ekfors), 15 November 2007, e-Competitions, n° 16061.

[47] See Sarah Beeston, The Dutch competition authority clears a natural gas supplier of allegations
of abusive pricing for the supply of gas (Productschap Tuinbouw/GasTerra), 26 June 2009, e-
Competitions, n° 32022.

[48] See also the Latvian case of excessive pricing of liquefied gas to apartment houses from
underground (Propana Gas (2008) (Latvia). See Debora Pavila, The Latvian Competition Council
fines a dominant liquified gas provider for excessive pricing (Propana Gaze), 10 December 2008, e-
Competitions, n° 25688.

[49] See Robert Pelikan, Jan Poevratil, The Czech Office for the Protection of Competition imposes
a record fine on the dominant wholesale gas distributor for alleged violations of Art. 82 EC (RWE
Transgas), 10 August 2006, e-Competitions, n° 12409.

[50] See Adela Horakova, The appellate body of the Czech Office for Protection of Competition
confirms abuse of dominant position by the energy incumbent (RWE Transgas), 12 March 2007, e-
Competitions, n° 13659 and Jana Jichova, The Czech Office for the Protection of Competition
confirms in appeal the abuse of dominant position of the natural gas incumbent althought reducing the
fine imposed to Eur. 8.5 M (RWE Transgas), 12 March 2007, e-Competitions, n° 13612.

[51] See Adela Horakova, A Czech Court quashes the NCA decision having imposed the highest fine
ever to a single undertaking for anti-competitive practices on the natural gas wholesale market (RWE
Transgas), 22 October 2007, e-Competitions, n° 14824.

[52] See Roman Barinka, The Czech Supreme Administrative Court rules that a concurrent
application of EC law and national law by the NCA to one anticompetitive conduct does not violate the
ne bis in idem principle (RWE Transgas), 31 October 2008, e-Competitions, n° 22673.

[53] See Sarunas Keserauskas, The Lithuanian Competition Authority fines the national oil refinery
for abuse of dominant position under Art. 82 EC (Mazeiki nafta), 22 December 2005, e-Competitions,
n° 426.

[54] See Sarunas Keserauskas, The Vilnius District Administrative Court annuls the NCA’s first Art.
82 EC case in Lithuania on both legal reasoning and procedural grounds and, inter alia, for not having
informed the EC Commission, in an excessive fuel prices case (Maeikiu nafta II), 28 June 2007, e-
Competitions, n° 13786.

[55] See Article from European Competition Network Brief, The Lithuanian Court of first instance
upholds Competition Authority’s decision fining a company active in the petrol and diesel distribution

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for abusing its dominant position (AB Orlen Lietuva), 15 April 2011, e-Competitions, n° 36588. See
also the Latvian case on Mazeikui Nafta pricing of grade 95E petrol.

[56] See Valerio Torti, The Italian Competition Authority accepts committments from the Italian
electricity incumbent and closes proceedings for alleged breach of art. 82 EC without imposing
sanctions (Comportamenti Restrittivi sulla Borsa Elettrica), 20 December 2006, e-Competitions, n°
14765.

[57] See Dr. Phyllis Aquilina, The Maltese Commission for Fair Trading fines the State undertaking
entrusted with exclusive right for fuel provision for discriminatory pricing (Cassar Fuels/Enemalta), 30
April 2007, e-Competitions, n° 14006.

[58] EU SI, cited above, p.13, para.. 64 and p.7, para. 24-26.

[59] See Casto Gonzalez-Paramo, Sonia Perez, The Spanish competition authority fines electricity
distributors Eur. 35,8 million for abusing their dominant position on the power commercialisation
market (Centrica/ Electra de Viesgo, Endesa and Union Fenosa), 2 April 2009, e-Competitions, n°
26212 and see the SCA website).

[60] See Article from European Competition Network Brief, The Italian Competition Authority
accepts commitments proposed by the historical electric operator and its subsidiaries to put an end to
an abuse of dominant position (ENEL), 10 December 2009, e-Competitions, n° 33435.

[61] ICA Annual Report 2010, English Version, p.11.

[62] See Yasmin Arshed, The UK Gas and Electricity Markets Authority accepts commitments
following a complaint from an Independent Connection’s Provider against anti-competitive conditions
of electricity connection services (SP Manweb), 27 October 2006, e-Competitions, n° 12561.

[63] See Michal Miko, Michal Volny, A Slovak Regional Court confirms the NCA decision having hold
as abusive a request of the gas transmission network operator to obtain ownership of the
interconnection system build by a gas distribution company (Eustream), 30 June 2010, e-
Competitions, n° 32223.

[64] See Alexandr Svetlicinii, The Bulgarian Competition Authority fines an electricity supplier for
exploitative abuse of dominant position (EVN Bulgaria Elektrorazpredelenie), 3 June 2010, e-
Competitions, n° 31626.

[65] See Alexandr Svetlicinii, The Moldovan Competition Authority finds an exploitative abuse of
dominant position in the invoicing practices of an electricity distributor (RED Union Fenosa), 22
February 2011, e-Competitions, n° 34942.

[66] See Alexandr Svetlicinii, The Bulgarian Competition Authority accepts the commitments offered
by the electricity provider in order to prevent abusive practices on the market for electricity
distribution (E.ON Bulgaria Sales), 25 March 2010, e-Competitions, n° 31410.

[67] See Alexandr Svetlicinii, The Bulgarian Competition Authority defines the termination of
electricity supply due to the debts accumulated by the previous owner as an abuse of dominant
position (EVN Bulgaria Elektrosnabdiavane), 11 March 2010, e-Competitions, n° 30926 and
Dessislava Fessenko, The Bulgarian Competition Authority considers behavioural commitments in
cases of refusal to supply (E.On Bulgaria / EVN Bulgaria), 11 March 2010, e-Competitions, n° 38135.
See also Alexandr Svetlicinii, The Bulgarian Competition Authority sanctions an electricity distributor
for refusal to supply despite the existing commitments decision in a similar case, 22 March 2011, e-
Competitions, n° 37380 and Dessislava Fessenko, The Bulgarian competition authority considers
behavioural commitments in cases of refusal to supply (E.On Bulgaria, EVN Bulgaria), e-Competitions,
10 March 2010, n° 31189.

[68] Italian Competition Authority, 21 August 2007, Case No A390, Enel Distribuzione/Attivazione
Fornitura Subordinata a Pagamenti Morosita’ Regresse, Provvedimento No 17169.

[69] See Michele Giannino, The Italian Competition Authority closes investigations on the conclusion
of new electricity supply contracts by imposing remedies to the incumbent operator (Enel), 21 August
2007, e-Competitions, n° 14860.

[70] See Alexandr Svetlicinii, The Macedonian Supreme Court upholds the NCA’s decision finding an
abuse of dominance on the electricity distribution market (Elektrostopanstvo), 6 September 2010, e-
Competitions, n° 33282 and Alexandr Svetlicinii, The Macedonian Administrative Court upholds the
NCA’s decision establishing abusive charges on the electricity distribution market (Elektrostopanstvo),
10 December 2009, e-Competitions, n° 30927.

[71] See Carl Wetter, Helena Hook, Emil Fahlen Godo, The Swedish Market Court upholds the
Competition Authority’s interim order imposing an obligation on an electrical company to provide a
potential customer access to its electricity mains (Ekfors Kraft), 26 February 2010, e-Competitions, n°
32044.

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Unilateral conduct in the energy sector: An overview of EU and national case law - Antitrust Writing Awards 2013 3/3/21, 14(17

[72] See Akos Kovach, Sambor Ryszka, An Hungarian Court of appeal upholds the NCA’s decision
having established an abuse of dominant position by the monopolist electricity provider on sub-
markets of the electricity supply sector (DEMASZ), 17 September 2008, e-Competitions, n° 22892.

[73] See Axel Reidlinger, Heinrich Kuhnert, The Austrian Federal Competition Authority settles a
dispute regarding jet fuel supply at the Vienna International Airport (OMV), 4 April 2008, e-
Competitions, n° 19526 and Axel Reidlinger, Marlen Grillmayer, The Austrian Federal Competition
Authority refers to the Cartel Court a case of alleged excessive pricing in the jet fuel market pursuant
to both Art. 82 EC and national provisions (Austrian Airlines/OMV), 12 June 2007, e-Competitions, n°
14065.

[74] See Alexandr Svetlicinii, The Croatian Competition Authority finds discriminatory pricing
practices on the market for jet fuel supplied in Croatian airports, 19 May 2011, e-Competitions, n°
37377.

[75] See Article from European Competition Network Brief, The Lithuanian Supreme
Administrative Court upholds Competition Authority’s Decision on abuse of dominance by an airport
operator (Vilnius International Airport - Naftelf), 15 March 2010, e-Competitions, n° 33462.

[76] See Vitaly Pruzhansky, Jan Peter van der Veer, The Russian Supreme Commercial Court
upholds a Eur. 28.5 M fine on a British-Russian oil company for abuse of dominance (TNK-BP), 25 May
2010, e-Competitions, n° 31901.

[77] See Anna Dec, The Polish competition authority fines the dominant petrochemical operator for
applying excessively low prices (PKN Orlen), 29 December 2006, e-Competitions, n° 13217.

[78] See Aitor Montesa Lloreda, Angel Givaja Sanz, The Spanish Competition Tribunal fines a
major electricity distribution company for offering services to clients in a liberalised market on the
basis of information obtained from a monopolised market (Endesa/Anisem), 14 December 2006, e-
Competitions, n° 13149.

[79] See Simon Barnes, The UK Court of Appeal upholds abuse of dominance finding against National
Grid but reduces the size of the fine imposed (National Grid/Gas and Electricity Markets Authority,
Capital Meters, Siemens, Meter Fit), 23 February 2010, e-Competitions, n° 31020 and Yasmin
Arshed, The UK Gas and Electricity Markets Authority finds that the network operator has abused its
dominant position in the market for the provision and maintenance of domestic-sized gas meters
(National Grid), 21 February 2008, e-Competitions, n° 16065.

[80] See Justin Coombs, The UK energy regulator finds no abuse of dominance in the refusal to
supply meter data services to competing electricity suppliers (EDF Energy), 24 January 2007, e-
Competitions, n° 13221 and Pierre-Hugues Vallee, The UK Gas and Electricity Market Authority
rejects alleged abusive data withdrawal in the electricity market (EDFE, Energywatch a. o.), 24
January 2007, e-Competitions, n° 13787.

[81] See Denis Fosselard, Stefania Amoruso, Lina Vitolo, The Italian Competition Authority closes
its first leniency application case finding a price fixing cartel among the three main operators in the
market for liquefied petroleum gas (Prezzo per il GPL), 24 March 2010, e-Competitions, n° 32064.

[82] Greek Competition Authority, 3 March 2011, Decision No 516/VI/2011. The text is available on
the GCA website. With thanks to Lisa Arsenidou for her assistance.

[83] See Philippe Chauve, Polyvios Panayides, The Commission finds that the Hellenic Republic
has infringed Article 86(1) in conjunction with Article 82 of the EC Treaty by maintaining the
preferential access to lignite in favour of the incumbent Greek electricity provider (PPC), 5 March
2008, e-Competitions, n° 35237.

[84] EC Press Release IP/11/34, 14 January 2011.

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