Poland: Recent competition developments
The Polish competition authority initiated proceedings against Gazprom and five partners (Engie, Uniper, OMV, Shell, and Wintershall) involved in financing and constructing the Nord Stream 2 gas pipeline. The authority had previously examined this initiative after the parties notified them of the joint venture project creation in December 2015.
Following a detailed market study, the authority presented concentration-related objections, determining that Gazprom was “a dominant company in the gas supply market to Poland” and that the concentration would strengthen its bargaining power with Polish clients. Consequently, the parties withdrew their merger application in August 2016.
Implementation Despite Rejection
Despite lacking clearance, the parties implemented the transaction and continued activities aimed at financing and constructing the Nord Stream 2 pipeline running from Russia to Germany via the Baltic Sea.
Potential Penalties
Such behavior may result in fines reaching 10% of the undertakings’ turnover. If restoration of competition is impossible, the authority may order asset disposal, stock or share disposal ensuring control, or company dissolution over which the undertakings have joint control.
Current Status
The proceedings remain in their initial stage, with parties presenting arguments regarding the authority’s charges. The authority has characterized the case as unprecedented, with final outcomes unpredictable and enforcement questions arising regarding companies located abroad.
The authority will consider Poland’s energy security concerns while handling this case.