italy: market test of commitments in alleged abuse by eni...

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• Italy: Market Test of Commitments in alleged Abuse by ENI in Gas Transportation CaseOn 12 June 2012, the Italian Competition Authority (ICA) published for market test the commitments proposed by Eni (Ente Nazionale Idrocarburi). In its commitments, Eni offered to auction off transportation quotas for 4 billion cubic meters of gas per year until 2017. The company will either allow its competitors to directly transport gas through the pipeline Transitgas and TAG, or swap gas pools that its rival bought in central Europe’s gas markets with equal amounts of gas that Eni owns in Italy. The ICA intends to adopt a decision in September.

On 6 March 2012, the ICA decided to launch proceedings against Eni in order to evaluate whether the company infringed article 102 TFUE by abusing its control over the gas pipeline networks Transitgas and TAG. The said transportation infrastructures connecting central and northern Europe with Italy and carrying part of the country’s gas imports were formerly managed by Eni. While Eni’s shares in the companies which own, operate and manage the transport capacity in TENP/Transitgas and TAG were recently dismissed pursuant to the commitments made binding by the Commission’s decision of 29 September 2010, Eni has retained the rights to a substantial part of the capacity on those transport infrastructures, connecting Central and Northern Europe with Italy and carrying part of the country’s gas imports.

The ICA proceedings seek to assess whether Eni abused its dominant position thwarting independent and low cost gas purchasing opportunities, and thus limiting its rivals’ ability to compete in the market for gas supply to large customers in Italy.

The investigation follows a complaint from Gas Intensive, an association representing large gas buyers, which purchases gas on behalf of its members and provides the corresponding transportation and storage activities. According to the complaint, until last year, Eni used to auction off the rights to the transportation quotas it did not use, but it ended the auctions last April, despite a substantial underuse of the pipelines. Such behavior was implemented soon after large gas buyers had for the first time been granted new storage capacity by the Legislative Decree n. 130 of 13 August 2010 which entered into force in August 2010. The complaint alleged that, Eni’s behavior impeded them from exploiting the opportunity to purchase gas in the markets located in the north of Europe at prices significantly lower than the Italian ones.

See ICA decision (in Italian) and press release (in English)