Gazprom Responds to EU Charges
September 28 2015 - 02:30PM
Dow Jones News
BRUSSELS—OAO Gazprom on Monday sent its response to European
Union charges that the Russian energy firm hindered competition and
charged unfair prices in Eastern Europe, arguing the case was
"economically and legally unfounded."
The response, which was expected by Monday, "shows why we
believe the European Commission's allegations are based on an
incorrect methodology," Gazprom said. It comes a week after Gazprom
said it proposed a settlement with EU regulators, a move that could
help the company avoid billion-dollar fines.
The European Commission, the bloc's top antitrust authority,
said it had received Gazprom's response and would consider it
"carefully…before taking any decision on how to proceed." The
regulator said it was assessing Gazprom's settlement proposals "in
parallel."
The commission in April filed formal charges against Gazprom,
saying the state-controlled company broke EU antitrust law in eight
countries where it is the dominant gas supplier—Bulgaria, Czech
Republic, Estonia, Hungary, Latvia, Lithuania, Poland and Slovakia.
The commission said restrictive terms in Gazprom contracts forced
territorial constraints on customers, for instance by prohibiting
them from re-exporting gas to another country. It also objected to
Gazprom's practice of tying the price of gas to that of oil.
Gazprom has consistently rejected the charges as politically
motivated; a claim the commission has denied. In recent months in
particular the company has pointed out that customers whose
contracts are tied to the price of oil are now enjoying
exceptionally cheap gas because of the collapse in global oil
prices.
In its statement on Monday, Gazprom said "when it comes to [the
company's] alleged 'excessive pricing,' our response provides
evidence and data to show why the Commission's conclusions are both
economically and legally unfounded."
The company said it would continue with settlement talks "in
order to settle the case on mutually acceptable ground, taking into
account the arguments presented in our response." While Gazprom has
denied any wrongdoing, its management has said it was open to a
settlement.
If accepted, a settlement could help the company avoid fines,
but would likely require it to fundamentally change the way it has
done business in Eastern Europe since the collapse of the Soviet
Union.
The commission said it couldn't "anticipate the timing for the
next steps in the investigation."
Gabriele Steinhauser contributed to this article.
Write to Tom Fairless at tom.fairless@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
September 28, 2015 14:15 ET (18:15 GMT)
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