Supreme Court Quashes Anti-Trust Watchdog's Ban of Concentration between Inercom Bulgaria and CEZ Bulgaria Group
NW 20:00:01 13-05-2021
LG2003NW.118
118 ECONOMY - ANTI-TRUST - CEZ - INERCOM
Supreme Court Quashes Anti-Trust
Watchdog's Ban of Concentration between
Inercom Bulgaria and CEZ Bulgaria Group
Sofia, May 13 (BTA) - A three-judge panel of Bulgaria's Supreme Administrative Court (SAC) on Thursday revoked a decision of 2018 by which the Commission for Protection of Competition (CPC) banned a business concentration that would have taken place if Inercom Bulgaria gained control over the Bulgarian businesses of Czech energy group CEZ.
The judgment can be appealed before a five-judge panel of the same court.
The SAC found that the CPC decision was legally non-conforming and procedurally flawed and decided to return the case file to the CPC for a new pronouncement in compliance with the Court's binding requirements for interpretation and application of the law.
The Supreme Court determined that the solar power market share of Inercom and CEZ combined (2.517 per cent) would be insufficient to justify a possible market dominance, which could be achieved at a share of at least 15 per cent-plus.
In July 2018, the anti-trust regulator blocked CEZ's attempt to sell its electricity distribution and supply operation in Western Bulgaria to Pazardjik-based Inercom Bulgaria EAD, arguing that the buyer would thus obtain a dominant position on the electricity market because of the solar power generation business it owned. While Inercom and the CPC argued over the matter, the time limit for finalizing the sale expired and the Czech group cancelled it.
Later on, in June 2019 CEZ signed a contract for the sale of its Bulgarian business for 335 million euro to insurance company Eurohold Bulgaria EAD. In October, the CPC refused to clear that transaction, too, finding that merging the experience, economic resources and market positions of the companies in the electricity and insurance markets would considerably hinder effective competition on the respective markets. The anti-trust watchdog suspected that the new owner could furnish guarantees to the energy companies when trading in electricity on the exchange. That decision was appealed before the Sofia Administrative Court, which found a number of irregularities and returned it to the Competition Commission for re-examination. In late October 2020, the CPC ultimately approved the transfer, and its finalization is now in progress.
CEZ's assets in Bulgaria comprise the CEZ Distribution Bulgaria electricity distribution company, the CEZ Electro Bulgaria power supplier, the CEZ Trade Bulgaria licensed electricity trader, the CEZ ICT Bulgaria IT service provider, the Free Energy Project Oreshetz solar park, the Bara Group biomass-fired power plant, and CEZ Bulgaria. NV/LG//
LG2003NW.118
118 ECONOMY - ANTI-TRUST - CEZ - INERCOM
Supreme Court Quashes Anti-Trust
Watchdog's Ban of Concentration between
Inercom Bulgaria and CEZ Bulgaria Group
Sofia, May 13 (BTA) - A three-judge panel of Bulgaria's Supreme Administrative Court (SAC) on Thursday revoked a decision of 2018 by which the Commission for Protection of Competition (CPC) banned a business concentration that would have taken place if Inercom Bulgaria gained control over the Bulgarian businesses of Czech energy group CEZ.
The judgment can be appealed before a five-judge panel of the same court.
The SAC found that the CPC decision was legally non-conforming and procedurally flawed and decided to return the case file to the CPC for a new pronouncement in compliance with the Court's binding requirements for interpretation and application of the law.
The Supreme Court determined that the solar power market share of Inercom and CEZ combined (2.517 per cent) would be insufficient to justify a possible market dominance, which could be achieved at a share of at least 15 per cent-plus.
In July 2018, the anti-trust regulator blocked CEZ's attempt to sell its electricity distribution and supply operation in Western Bulgaria to Pazardjik-based Inercom Bulgaria EAD, arguing that the buyer would thus obtain a dominant position on the electricity market because of the solar power generation business it owned. While Inercom and the CPC argued over the matter, the time limit for finalizing the sale expired and the Czech group cancelled it.
Later on, in June 2019 CEZ signed a contract for the sale of its Bulgarian business for 335 million euro to insurance company Eurohold Bulgaria EAD. In October, the CPC refused to clear that transaction, too, finding that merging the experience, economic resources and market positions of the companies in the electricity and insurance markets would considerably hinder effective competition on the respective markets. The anti-trust watchdog suspected that the new owner could furnish guarantees to the energy companies when trading in electricity on the exchange. That decision was appealed before the Sofia Administrative Court, which found a number of irregularities and returned it to the Competition Commission for re-examination. In late October 2020, the CPC ultimately approved the transfer, and its finalization is now in progress.
CEZ's assets in Bulgaria comprise the CEZ Distribution Bulgaria electricity distribution company, the CEZ Electro Bulgaria power supplier, the CEZ Trade Bulgaria licensed electricity trader, the CEZ ICT Bulgaria IT service provider, the Free Energy Project Oreshetz solar park, the Bara Group biomass-fired power plant, and CEZ Bulgaria. NV/LG//
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