Poland fines Gazprom €6.5bn over Nord Stream 2

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Poland’s competitors watchdog has fined Russia’s state-controlled fuel big Gazprom 29bn zlotys (€6.5bn) for going forward with the development of the Nord Stream 2 pipeline without securing its approval.

The pipeline will double Moscow’s capability to ship fuel immediately from Russia to Germany however is fiercely opposed by Poland and different central European states that argue it should improve the EU’s power dependence on Russia.

Wednesday’s effective is the biggest ever by Poland’s competitors regulator UOKiK and comes simply weeks after the poisoning of Kremlin critic Alexei Navalny gave renewed impetus to a debate in Germany concerning the deserves of the controversial €9.5bn undertaking.

In addition to fining Gazprom, UOKiK imposed penalties totalling 234m zlotys on the 5 western firms — Engie, Uniper, OMV, Shell and Wintershall — which might be co-financing the undertaking. 

“So far as power safety is worried, the enterprise splits Europe into two elements,” mentioned Tomasz Chrostny, head of UOKiK. “It’s astounding that western companies fail to grasp that, and take part in an enterprise that not solely disturbs competitors in the marketplace but additionally poses a menace to Europe’s power safety.”

Mr Chrostny ordered the businesses to terminate financing contracts linked to the undertaking inside 30 days, to “reinstate the state of competitors from previous to the focus”.

Gazprom mentioned UOKiK’s choice was based mostly on incorrect data and that it will attraction, a transfer that may delay any authorized enforcement of the choice.

“Gazprom basically disagrees with the place of the Polish
anti-monopoly authority,” the corporate mentioned in an announcement. “The undertaking
was carried out not by a three way partnership, however by a subsidiary of Gazprom
with the attraction of debt financing . . . [the company] didn’t violate
the anti-monopoly laws of the Republic of Poland.”

The Kremlin added on Wednesday that it had little question Gazprom would take the mandatory authorized countermeasures.

The US has additionally been a vociferous opponent of the undertaking. Officers mentioned in July that Washington would toughen its sanctions regime for firms serving to Russia full the pipeline.

Shares in Gazprom, which is 50.2 per cent managed by the Kremlin, had been down 1.9 per cent in early-afternoon buying and selling in Moscow.

Nonetheless, analysts mentioned this was much less to do with the potential monetary influence of the effective than basic opposition to Nord Stream 2.

“We aren’t legal professionals however the effective appears too massive to be reasonable,” mentioned Ron Smith, govt director at BCS World Markets in Moscow. “To
us it appears engineered extra to generate headlines than in any
expectation of Gazprom ever really paying such a effective.”

Mr Smith added that even when the effective was pursued to the judicial finish by each side, “we wouldn’t anticipate a remaining choice for a few years”.

OMV mentioned it will analyse the choice however was “of the clear opinion that it has complied with all relevant legal guidelines”. Shell mentioned it strongly disagreed with the choice and was reviewing its subsequent steps.

Engie, Uniper and Wintershall didn’t instantly reply to requests for remark.