EC Investigates State-Owned Gas Giants

 

Both Russia’s and Bulgaria’s state-controlled natural gas companies have come under investigation for anti-trust practices, the European Commission announced last week.

The Russian giant Gazprom, which was the single most profitable company in the world in 2011, is charged with stifling competition and using its large market share to inflate the price of gas for its customers. The customer countries named in the investigation were Poland, Czech Republic, Slovenia, Hungary, Bulgaria, Estonia, Latvia, and Lithuania, an EC spokesperson said on Monday.

Despite Gazpram’s near-monopoly, its customer nations have not yet acted to limit its influence. Early this year, Bulgaria’s own antitrust agency approved the purchase of fourteen new filling stations by a Gazprom subsidiary.

Also on Monday the Commission announced an anti-trust investigation in to Bulgaria’s majority state-owned gas company, Bulgarian Energy Holding (BEH). BEH is charged with collusion and blocking rivals from its transmission network, an EC spokesperson said.

As part of its investigation, the EC will examine the recent deal struck by BEH and Gazprom to construct the Bulgarian section of the South Stream pipeline, which transports natural gas from Russia throughout the region. According to various media reports, Gazprom pressured the Bulgarian government to accept the deal by withholding a previously promised discount on gas.