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On 9 December 2004 the Commission adopted a Decision in a merger case under Council Regulation (EEC) No 4064/89 of 21 December 1989 on the control of concentrations between undertakings(1), and in particular Article 8(3) of that Regulation. A non-confidential version of the full Decision can be found in the authentic language of the case and in the working languages of the Commission on the website of the Directorate-General for Competition, at the following address: http://europa.eu.int/comm/competition/index_en.html
wholesale supply of electricity,
provision of regulating/balancing power services(3),
transmission grid,
distribution grid,
retail supply of electricity (large customers and small customers).
many important regulatory barriers still have to be removed for the purpose of the establishment of the MIBEL;
competitive conditions between Spain and Portugal are likely to remain significantly different even after the launch of the MIBEL;
CO2 emission national allocation plans and national compensation scheme for stranded costs are likely to maintain or even increase these differences in the competitive conditions;
the projected level of interconnection capacity between Spain and Portugal is not likely to allow effective integration of both markets in the foreseeable future.
supply of gas to power producers (CCGTs(10));
supply of gas to local distribution companies (LDC);
supply of gas to large industrial customers (LICs);
supply of gas to small industrial, commercial and domestic customers.
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Reduction of EDP’s shares in REN from 30 % to 5 %
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Divestment of EDP’s shares in Tejo Energia
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Moratorium concerning the construction of new CCGTs subject to a review clause
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Lease of TER production capacity equivalent to one unit subject to a review clause
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Suspension of some of EDP’s voting rights in Turbogás and appointment of independent board members in Turbogás
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Sale of the Sines LNG terminal to REN
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Sale of the Carriço underground storage to REN
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Anticipated sale of the gas high-pressure network to REN
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Guarantees for access to the network pending sale of the network to REN
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Release to REN of the capacity at the Campo Maior entry point currently booked and unused by Transgás
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Commitment not to book further capacity at the Campo Maior entry point
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Commitment not to book further capacity on the Extremadura pipeline
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Commitment to make capacity available on the Extremadura pipeline and/or at the Campo Maior entry point under certain conditions
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Elimination of GDP’s right of first refusal, based on ‘matching the best offer mechanism’.
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measures aimed at eliminating concerns related to possible privileged access to price information
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Measures aimed at ensuring scope for the effective liberalisation of the demand represented by LICs
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Commitment not to engage in dual offers of natural gas and electricity to LICs and retail customers in Portugal until the natural gas supply to such customer groups is liberalized
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Sale of the LDC Setgás.
OJ L 395, 30.12.1989, p. 1. Regulation as last amended by Regulation (EC) No 1310/97 (OJ L 180, 9.7.1997, p. 1).
Directive 2003/55/EC of the European Parliament and of the Council of 26 June 2003 concerning common rules for the internal market in natural gas and repealing Directive 98/30/EC (OJ L 176, 15.7.2003, p. 57).
See Case COMP/M.3268-Sydkraft/Graninge.
The price formula essentially guarantees the payment for capacity (which implies a predetermined return on invested capital for the plant) and for energy (based on a reflection of costs).
Tejo Energia is controlled by the British company International Power, which holds 45 % of the shares, and by the Spanish company Endesa, with 35 % of the shares. EDP and Electricité de France only hold a minority 10 % interest each, which does not seem to confer to either of them the possibility to exercise joint control over the company.
At the time of the notification Turbogás was controlled by the German power company RWE. EDP holds a 20 % stake, which does not seem to confer to it the possibility to exercise joint control over the company. RWE has since concluded a sales agreement with International Power. International Power’s purchase has been approved by the Portuguese Competition Authority.
35 TWh out of a total supply of 43 TWh in 2003.
Portugal will thus advance implementation of Directive 2003/54/EC of the European Parliament and the Council (OJ L 176, 15.7.2003, p. 37), which provides the full opening the electricity retail markets as from 1 July 2007.
See e.g. Case M. 2434 — Grupo Villar MIR/ENBW/Hidrocantabrico.
CCGTs stands for ‘Combined Cycle Gas Turbines’ power plants.
Respectively between 4 and 20 bar and below 4 bar.
The Commission also has to assess intermediate steps in the evolution of the market structure, in particular as a situation, even though temporary, may have a strong detrimental impact on competition and, possibly, long-lasting effects.
EDP’s 20 % shareholding in Turbogás confers to it certain blocking rights.
That is: (i) EDP’s ability and incentive to control gas prices and raise its rivals’ costs, thereby foreclosing its actual and potential competitors and deterring entry; (ii) EDP’s ability to manage the constraints in the gas supply to CCGTs to the detriment of competing CCGTs; (iii) EDP’s access to proprietary information about its competitors’ costs and daily gas nominations, conferring on it a significant advantage.
The deadline for the submission of remedies was 17 November 2004.