December 19, 2018 / 5:14 PM / a month ago

Bulgaria's energy company BEH likely to appeal EU fine

SOFIA, Dec 19 (Reuters) - State-owned Bulgarian Energy Holding (BEH) said on Wednesday it would very likely appeal the hefty fine the European Union antitrust regulators slapped on it for blocking rivals’ access to key gas infrastructure in Bulgaria between 2010 and 2015.

The European Commission fined BEH 77 million euros ($88 million) on Monday, saying the company abused its market dominance to hinder competition.

BEH’s gas supply unit, Bulgargaz, and its gas network operator, Bulgartransgaz, are also subject to the fine.

BEH and its units denied any wrongdoing and said they believed the access to the Balkan country gas network and its gas storage facility had always been granted in line with the law. They also said the imposed fine was disproportionate.

“The companies will carefully look at the decision and will probably appeal it by challenging both the allegations and the amount of the fine,” BEH said in a statement.

BEH said although the fine should be paid within three months, in the case of an appeal it can either make a provisional payment of the fine or provide collateral.

The Bulgarian government says the European Commission would have agreed to a settlement only if Sofia sold a majority take in Bulgatransgaz to a European strategic investor as a guarantee that market would not be distorted.

Bulgaria, which still meets all of its gas needs through one route from one supplier — Russia’s Gazprom — says such an option is unacceptable, as its gas pipelines were strategic infrastructure. “On the final line of the negotiations we proposed all kinds of options that should guarantee transparency and control ... including selling a minority stake,” deputy Prime Minister Tomislav Donchev told ministers.

“Naturally, no-one from the government would seek an agreement for a majority stake sale,” he said in minutes from a cabinet meeting, published by the government’s press office.

Sofia plans to keep Bulgargaz and Bulgartransgaz as BEH’s units, which is in line with EU energy rules.

The country is working to diversify its gas routes and suppliers. It also wants to build a new pipeline that is likely to transport mainly Russian gas from the TurkStream pipeline to central Europe, bypassing Ukraine. (Reporting by Tsvetelia Tsolova; editing by David Evans)

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