EU, Gazprom to seek settlement in antitrust probe

Dec. 6, 2013 at 12:02 AM   |   0 comments

BRUSSELS, Dec. 6 (UPI) -- The European Union and Gazprom say they have agreed to try to settle antitrust claims pending against the Russian energy supplier.

European Commissioner for Competition Joaquin Almunia said Wednesday after talks with Gazprom Deputy Chairman Alexander Medvedev in Brussels the two sides were ready to discuss an agreement on ending the antitrust probe, ITAR-Tass reported.

"Gazprom has expressed a willingness to explore the possibility of reaching a mutually acceptable solution," he said, adding he expected the Russian company to present its proposals for the dropping of the claims to the European Commission in the coming days.

The announcement came after Almunia warned last month he had already formulated a list of "legitimate claims" against Gazprom with a likely filing of charges coming early next year.

Medvedev confirmed to the Financial Times that his company, the Russian government and the European Commission had agreed to "try to find a mutually acceptable solution."

"Together we will try to find a solution before a statement of objections [formal antitrust charges] are issued," he said, adding that the final agreement should "meet the concerns of the competition authorities without damaging our activity in European markets."

The EU in 2012 opened formal proceedings to investigate whether Gazprom was obstructing competition and using its dominant market position to charge artificially high gas prices in Central and Eastern Europe and the Baltic states.

The move was met with anger in Moscow, where Russian President Vladimir Putin banned Gazprom and other state-owned companies from disclosing information to foreign regulators.

The probe was launched after a complaint from Lithuania, a country entirely dependent on Russian natural gas imports, as it was seeking to spin off ownership of its gas transmission network in accordance with the European Union's energy market reform efforts requiring the "unbundling" of natural gas distribution networks from suppliers -- Gazprom's longtime business model.

Gazprom, which holds a 37 percent share of the Lithuanian national gas company Lietuvos Dujos, battled Vilnius in court to prevent it from spinning off its gas transmission operations into a separate company, which was ultimately launched in July without Russian participation.

EU Energy Commissioner Gunther Oettinger said last year Lithuania and other Eastern and Central European countries must be protected from energy price-gouging, the Sofia News Agency reported.

"All gas exporters, be it from Russia or Norway, Algeria or Qatar, have to accept our internal market rules," he said. "The Russian partners understand our rules, but they don't accept them all. It is a different culture."

Putin, he added, "knows very well that Russia has to accept the rules of our internal market with 500 million consumers. It's the biggest business case for Gazprom."

The Russian leader, however, has said it's the European Union that is playing politics by seeking to examine the business practices of Gazprom.

Putin asserted last year the EU is using the issue to try to extend its influence over Eastern Europe -- charges that have come to the forefront this month after Ukraine lawmakers decided to end negotiations on an EU "association agreement," sparking civil unrest in Kiev.

"Europe wants to maintain political influence [in the region] but in such a way that we pay for it a little," he said, describing the investigation as "counterproductive."

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