EON avoids EU fine by opening access to German gas market

4th May 2010, Comments 0 comments

German energy giant E.ON has ended a potentially costly competition probe by offering to "effectively open up access to the German gas market," the EU's anti-trust watchdog announced Tuesday.

The move by E.ON addresses EU concerns that the company "may have unfairly shut out competitors in a possible abuse of its dominant market position," the European Commission said in a statement.

"With today's commitments we have achieved a far-reaching solution which will give competitors access to the transport capacities they need to enter the market," said EU Competition Commissioner Joaquin Almunia.

Following the launch of a commission probe, E.ON undertook to release large capacity gas volumes at the entry points to its gas networks by October 2010, corresponding to about 15 percent of the pipeline capacity.

From 2015 the Germany company will make further moves to open the market.

"The commitments are expected to have a major structural impact on the possibility for other companies to compete on the German market," the commission opined, as access to gas pipelines is vital for new market entrants.

As a consequence Brussels formally ended its probe and closed the case without imposing any fine.

The commission confirmed in December that it had opened an enquiry into EON Ruhrgas, an affiliate of the German group.

The commission had earlier expressed concern that E.ON "may have closed off competitors from the market by booking almost the entire capacity at key entry points into the gas network on a long-term basis."

Companies found guilty of abusing a dominant position in markets can be fined up to 10 percent of global turnover under EU rules.

The record anti-competition fine inflicted by the EU to date was 1.06 billion euros against US computer chip maker Intel, which is appealing the decision.

Often in such cases the company in the spotlight agrees to make concessions to assuage Brussels.

© 2010 AFP

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