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EU fines GDF Suez for antitrust negligence
Source: Agencies |
June 11, 2009, Thursday
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EUROPEAN Union regulators yesterday fined the Belgian unit of energy company GDF Suez SA 20 million euros (US$28.2 million) for failing to seek antitrust approval to take control of a rival electricity producer in 2003.
Under EU law, the European Commission must examine any antitrust problems with all takeover deals where each company makes revenues of more than 250 million euros in the 27-nation bloc.
Belgium's largest electricity supplier Electrabel SA failed to seek approval when it bought close to 50 percent of France's Compagnie Nationale du Rhone, or CNR, in 2003, regulators said.
The Belgian electricity supplier was in turn bought by Suez in 2005.
Electrabel and CNR finally filed for and won regulatory clearance in 2008. The deal raised no competition concerns.
"Electrabel should have been aware of its obligation to receive Commission approval before proceeding with the acquisition," the EU executive said, describing the company's actions as "a serious breach of the merger regulation."
Last week, the Belgian energy regulator warned that Electrabel and its nearest Belgian rival SPE had made up to 1.5 billion euros in windfall profits by charging business customers for carbon pollution permits that they received for free from the government since 2005.
Belgium's energy minister Paul Magnette said he would ask the government to tax these profits.
Both Electrabel and SPE say they are justified in passing on the cost of taking part in the EU carbon trading program.
EU carbon trading aims to punish heavy polluters by forcing them to buy extra permits if they exceed their pollution quota for a year. Companies that pollute less can sell off their permits to others.
Under EU law, the European Commission must examine any antitrust problems with all takeover deals where each company makes revenues of more than 250 million euros in the 27-nation bloc.
Belgium's largest electricity supplier Electrabel SA failed to seek approval when it bought close to 50 percent of France's Compagnie Nationale du Rhone, or CNR, in 2003, regulators said.
The Belgian electricity supplier was in turn bought by Suez in 2005.
Electrabel and CNR finally filed for and won regulatory clearance in 2008. The deal raised no competition concerns.
"Electrabel should have been aware of its obligation to receive Commission approval before proceeding with the acquisition," the EU executive said, describing the company's actions as "a serious breach of the merger regulation."
Last week, the Belgian energy regulator warned that Electrabel and its nearest Belgian rival SPE had made up to 1.5 billion euros in windfall profits by charging business customers for carbon pollution permits that they received for free from the government since 2005.
Belgium's energy minister Paul Magnette said he would ask the government to tax these profits.
Both Electrabel and SPE say they are justified in passing on the cost of taking part in the EU carbon trading program.
EU carbon trading aims to punish heavy polluters by forcing them to buy extra permits if they exceed their pollution quota for a year. Companies that pollute less can sell off their permits to others.
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