EU opens antitrust probe against E.ON and Gaz de France

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The European Commission has opened a formal investigation against German energy giant E.ON and Gaz de France for allegedly agreeing to keep out of one another’s home market, thereby thwarting competition and keeping prices artificially high.

The suspected market sharing concerns supplies of natural gas transported over the MEGAL pipeline jointly owned by E.ON and Gaz de France. MEGAL is “the only pipeline that brings in Russian gas into France”, a Commission expert said.

The Commission indicated that the antitrust investigation would “focus on a possible agreement or concerted practice between E.ON and Gaz de France to keep out of each other’s home market, even after the liberalisation of the European gas markets”, which took place in July 2004.

The inquiry was opened after Commission staff collected evidence in office raids conducted in several countries a year ago (EURACTIV 18/05/06). 

The EU’s antitrust regulator said that there was no strict deadline to complete the inquiry, explaining that its duration would depend on the complexity of the case and the extent to which E.ON and Gaz de France would co-operate. According to EU rules, the companies could face fines of up to 10% of their annual turnover.

Concerned by its growing dependence on Russian gas, the EU has been trying to diversify transport routes and increase imports from other producers such as Algeria and Qatar.

France has been under renewed attention from Brussels as of late over its reluctance to open up its energy market to full competition and for its refusal to scrap its cherished regulated price system which keeps prices below market level (EURACTIV 30/07/07).

The Commission is due to issue a proposal to further liberalise EU energy markets in September.

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