summary of the case
| status: | closed by Ministerial Council Decision / not complied after Art.91 MC Decision |
|---|---|
| registered: | ex officio 2013 |
Under Directive 2003/55/EC, especially under its follow up Directive 2009/73/EC (Third Package), vertically integrated gas undertakings need to unbundle their transmission system operation (TSO) activities from the activities related to the supply of gas. The Secretariat has long been concerned that the two TSOs licensed in the country, the State-owned Srbijagas and Yugorosgaz, a 50% subsidiary of the Russian Gazprom, do not comply with this requirement. The deadline for the implementation of the Directive was 1 July 2007. Srbijagas has not yet unbundled its transmission system activities in terms of its legal form. Yugorosgaz has established a subsidiary for pipeline transport. However, the Secretariat is concerned that the undertaking has not taken measures to comply with the Directive’s requirements aimed to ensure the independent decision-making within that company (functional unbundling).
With the adoption of Decision 2014/03/MC-EnC, the procedure under Article 91 of the Treaty in Case ECS-09/13 is closed. On 10 August 2016, the Secretariat initiated Case ECS-09/13S by submitting a Reasoned Request to the Ministerial Council under Article 92 of the Treaty.
procedural history
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24 October 2013: Opening Letter
Case
On 24 October, the Secretariat sent an Opening Letter to Serbia in accordance with Article 12 of the Rules of Procedure for Dispute Settlement. In the Opening Letter, the Secretariat takes the preliminary view that Serbia failed to comply with its obligations under the Energy Community Treaty related to the unbundling of two vertically integrated gas undertakings.
Procedure
By sending an Opening Letter, the Secretariat initiates a preliminary procedure, the purpose of which is giving the Party concerned the possibility, within two months, to react to the allegation of non-compliance with Energy Community law, and enabling the Secretariat to establish the full background of the case.
According to Articles 6 and 16 of the Rules of Procedure for Dispute Settlement, interested parties may be granted access to the case file and may submit written observations on the present case to the Secretariat within one month from 24 October 2013.
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24 February 2014: Reasoned Opinion
Steps taken
On 24 February 2014, the Energy Community Secretariat submitted a Reasoned Opinion in Case ECS-9/13 against Serbia, for its failure to comply with gas unbundling rules. Having taken into account the Government’s reply to the Opening Letter, the Secretariat maintains its findings made therein. In the Reasoned Opinion, it reiterates its view that Serbia has failed to comply with its obligations under the Energy Community Treaty related to the unbundling of two vertically integrated gas undertakings.
Procedure
A Reasoned Opinion is the second step in a dispute settlement procedure initiated by the Secretariat under Article 90 of the Energy Community Treaty. Depending on the Government's reply, the Secretariat may submit the case to the Ministerial Council for a decision on Serbia’s compliance with Energy Community law.
Serbia is now requested to rectify the identified issues of non-compliance within a time limit of two months.
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23 April 2014: Reasoned Request
Steps taken
On 23 April 2014, the Secretariat submitted a Reasoned Request to the Energy Community Ministerial Council seeking its decision on Serbia’s failure to comply with gas unbundling rules of the Second Energy Package.
Reasoning
On 24 February 2014, the Secretariat had sent a Reasoned Request to Serbia requesting the country to rectify the identified issues of non-compliance within a time limit of two months. Serbia failed to inform the Secretariat within the established deadline of any steps to bring the situation in compliance with Energy Community law.
Procedure
Due to the lack of an adequate response from the Serbian authorities and the extensive delay in the implementation of the respective requirements of Directive 2003/55/EC, the Secretariat has submitted the Reasoned Request to the Ministerial Council, in accordance with Article 28 of the Rules of Procedure for Dispute Settlement.
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23 September 2014: Ministerial Council Decision on failure
Steps taken
After having considered the Opinion by the Advisory Committee, which largely upheld the Reasoned Request, the 12th Ministerial Council took a decision on the failure by Serbia to comply with certain obligations under the Treaty. The Ministerial Council declared the existence of a breach by Serbia of its obligations relating to unbundling of its gas TSOs Srbijagas and Yugorosgaz.
In the Article 1 of the Decision, the failure is listed in detail. In Article 2 of the Decision, the ministers urge Serbia to "take all appropriate measures to rectify the breaches identified in Article 1 and ensure compliance with Energy Community law, in cooperation with the Secretariat, by December 2014".
Procedure
Serbia is asked to report to the Secretariat and the Permanent High Level Group about the measures taken. The ministers invited the Secretariat to initiate a procedure under Article 92 of the Treaty if the breaches are not rectified by 1 July 2015.