gmb45
9th July, 2009, 04:02 AM
One of Britain's biggest energy suppliers has been fined ?478million for stitching up gas supplies.
Millions of British families faced higher bills after E.ON, which is based in Germany, and GDF Suez of France effectively agreed not to compete against each other.
E.ON apparently agreed not to sell gas in France in return for a promise that GDF Suez would not to try to take any of its business in Germany.
Secret carve-up: German gas supplier E.ON (above) and GDF Suez of France have been fined for agreeing not to compete with each other in their national markets
Neelie Kroes warned other energy companies that the Commission wouldl not tolerate any form of anti-competitive behaviour
Strong message: Neelie Kroes warned other energy companies that the Commission would not tolerate any form of anti-competitive behaviour
The resultant higher prices in Europe translated to bigger bills in Britain because the UK is increasingly reliant on gas imports.
The deal between GDF Suez and E.ON revolved around the sale of gas through the 500-mile Megal pipeline which crosses Germany from the Czech Republic to France.
When the firms built the pipeline they legally agreed to not sell gas in each other's markets. This was maintained after 2000 when the EU outlawed such arrangements. Now the European Commission has fined E.ON and GDF Suez ?478million each.
There has been mounting concerns that utility giants on the Continent - which have control over gas pipelines and electricity transmission - have exploited their dominance to push up prices and profits.
One result is that it has been impossible for firms such as British Gas to import cheap gas from Russia.
Alexandros Chatzinerantzis, an expert in competition law, said: 'The ruling is a clear signal to utilities that Europe is making sure they give up past monopoly positions.'
E.ON, which sponsors the FA Cup, and GDF Suez denied any wrongdoing and said they would appeal.
Millions of British families faced higher bills after E.ON, which is based in Germany, and GDF Suez of France effectively agreed not to compete against each other.
E.ON apparently agreed not to sell gas in France in return for a promise that GDF Suez would not to try to take any of its business in Germany.
Secret carve-up: German gas supplier E.ON (above) and GDF Suez of France have been fined for agreeing not to compete with each other in their national markets
Neelie Kroes warned other energy companies that the Commission wouldl not tolerate any form of anti-competitive behaviour
Strong message: Neelie Kroes warned other energy companies that the Commission would not tolerate any form of anti-competitive behaviour
The resultant higher prices in Europe translated to bigger bills in Britain because the UK is increasingly reliant on gas imports.
The deal between GDF Suez and E.ON revolved around the sale of gas through the 500-mile Megal pipeline which crosses Germany from the Czech Republic to France.
When the firms built the pipeline they legally agreed to not sell gas in each other's markets. This was maintained after 2000 when the EU outlawed such arrangements. Now the European Commission has fined E.ON and GDF Suez ?478million each.
There has been mounting concerns that utility giants on the Continent - which have control over gas pipelines and electricity transmission - have exploited their dominance to push up prices and profits.
One result is that it has been impossible for firms such as British Gas to import cheap gas from Russia.
Alexandros Chatzinerantzis, an expert in competition law, said: 'The ruling is a clear signal to utilities that Europe is making sure they give up past monopoly positions.'
E.ON, which sponsors the FA Cup, and GDF Suez denied any wrongdoing and said they would appeal.