Azernews.Az

The European Commission has opened an antitrust investigation into Gazprom's dominant position on natural-gas markets in Central and Eastern Europe, Radio Liberty reported.

The commission is investigating whether the Russian state-controlled energy firm violated antitrust laws by hindering competition in the region.

In a statement, the commission said it "has concerns that Gazprom may be abusing its dominant market position in upstream gas supply markets."

The countries concerned are Bulgaria, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, and Slovakia.

The European Commission does not exclude that other countries also may be included in the probe once the formal investigation gets under way.

Tight with the taps

The European Union's executive said it suspects Gazprom has been involved in three anticompetitive practices -- restricting the free flow of gas in EU states, hindering competitors, and charging customers unfair prices by linking oil prices with natural gas prices.

Antoine Colombani, the European Commission spokesman responsible for competition cases, told RFE/RL that a preliminary investigation into the issue started last year and that it had discovered enough information through inspections to launch a formal investigation on September 4.

"This is the start of the proper investigation by the European Commission into a possible abuse by Gazprom of its dominant position in this market," Colombani said.

There is no legal deadline for such antitrust investigations, but the formal probe is expected to take at least several months.

Possible fines

Colombani said that if the formal investigation determines Gazprom has violated EU antitrust laws, Gazprom would have to pay a hefty fine:

"The commission has the power to impose sanctions, including fines in cases of violations of EU competition rules, but today it is completely premature to prejudge what the outcome of the investigation is," Colombani said. "The Commission of course respects the right of defense and the presumption of innocence."

The European Commission is empowered to issue fines of up to 10 percent of a company's annual global turnover in cases where a firm is found guilty of anticompetitive practices.

Firms also can reach a settlement with the European Commission before a guilty finding is reached.