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Gazprom Faces $7.58 Billion Fine From Polish Regulator Over Nord Stream 2 Pipeline

10/07/2020 | 06:26am EST

By Anthony O. Goriainoff

Poland's anti-monopoly office UOKiK said Wednesday that it had imposed a 29 billion-zloty ($7.58 billion) fine on Gazprom PJSC related to the building of the Nord Stream 2 gas pipeline.

UOKiK said the Russian energy giant was one of six companies working on the gas pipeline fined for undertaking work "without the required consent of the president of UOKiK."

The regulator also imposed a PLN234 million fine on France's Engie SA, Germany's Uniper SE and Wintershall AG, Austria's OMV AG, and Royal Dutch Shell PLC.

The Polish watchdog said the entities concerned are obliged to terminate the agreements for financing the project, which was intended to increase Russia's gas export capacity via the Baltic Sea.

The Polish anti-monopoly authority said the companies concluded--without permission to establish a joint venture--a number of agreements concerning the pipeline's financing and a number of other authorizations, such as, for instance, the ability to interfere with the operation of NS2.

UOKiK said that in 2016 its president voiced concerns regarding the plan and noted that the planned transaction could lead to the restriction of competition and presented its reservations. The companies then withdrew the application, meaning in practice that they were prohibited from performing the merger, the regulator said.

The regulator said information surfaced shortly thereafter stating that the companies had signed an agreement for the financing of the gas pipeline.

"Therefore, proceedings against Gazprom and its five trading partners regarding the execution of the transaction without obtaining approval from the authority were initiated," the regulator said.

"The financial penalties imposed are intended not only to convince the parties involved to observe the law, but also to discourage other players from attempting similar behaviors that violate anti-monopoly regulations in the future," UOKiK president Tomasz Chrostny said.

Gazprom didn't immediately respond to requests for comment.

Write to Anthony O. Goriainoff at anthony.orunagoriainoff@dowjones.com

(END) Dow Jones Newswires

10-07-20 0625ET

Stocks mentioned in the article
ChangeLast1st jan.
ELECTRICITÉ DE FRANCE 1.39% 13.16 Real-time Quote.32.55%
ENGIE -0.68% 12.5 Real-time Quote.-13.19%
ENGIE EPS S.A. 2.01% 12.7 Real-time Quote.41.11%
GAZPROM 1.59% 189 End-of-day quote.-26.29%
GAZPROM NEFT 1.05% 322.8 End-of-day quote.-23.17%
OMV AKTIENGESELLSCHAFT 5.54% 31.62 End-of-day quote.-36.86%
PUBLIC JOINT STOCK COMPANY GAZPROM 2.33% 5.06 Delayed Quote.-38.50%
ROYAL DUTCH SHELL PLC 3.45% 15.782 Delayed Quote.-39.68%
UNIPER SE -0.64% 28.04 Delayed Quote.-4.98%
WTI 0.97% 46.11 Delayed Quote.-25.53%
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