EU Antitrust Authorities to Start Legal Proceedings Against Gazprom

EU Competition Commissioner Joaquin Almunia said that EU regulators are preparing to initiate formal legal proceedings against Russia’s Gazprom, over allegation that the company abused its dominant position in the gas market.

“We are looking at the business practices of Gazprom, which we suspect of abuses in the supply of upstream gas in Central and Eastern Europe. Since we opened the formal probe one year ago, we have been investigating very actively,” said Almunia in a speech given in Vilnius in occasion of the Presidency’s European Competition Day.

The EU started the probe last August, investigating the pricing methods and the limitations to trade allegedly imposed by the Russian company.

“It would be premature to anticipate when the next steps might be taken, but we have now moved to the phase of preparing a statement of objections,” Almunia said, adding that EU regulators suspect Gazprom to have hindered the “free flow of gas across Member States and the diversification of sources of supply.” 

The European authorities are working on a “statement of objections,” a first step in any legal objections in which they list their concerns about a company’s behaviour. After the Commission released the “state of objections,” the company has eight weeks to answer the doubts about behaviours allegedly limiting competition.

In case European authorities decided to fine Gazprom, experts suggest that Gazprom could be called to pay $15 billion and change some of its business practices. The Russian company could also stave off the fine by offering concessions to settle the case.