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Monopoly on natural gas market in Romania: Interests supported by deputy Iulian Iancu push Romania to an open conflict with European Commission

de Victor Bratu , 5.3.2018

The European Commission will sue Romania at the European Court of Justice if the Parliament in Bucharest adopts the amendments to the Emergency Ordinance 64/2016 on the natural gas sector, the European Energy Commissioner Miguel Arias Canete said on Tuesday in a meeting in Brussels with representatives of the Romanian energy sector.

The amendments mentioned by the European Commissioner Canete were mostly supported by the PSD deputy Iulian Iancu (photo), the influential, tenacious and controversial chairman of the Chamber of Deputies’ Industrial Affairs Committee.

When Miguel Arias Canete made his first observations on the legislator’s intention, Iulian Iancu replied in October 2017: “Intentionally or not, I believe the data has been presented to the President of the European Commission in a manipulative and erroneous manner.”

Razvan Nicolescu, former energy minister in Ponta government and former chairman of the European Energy Regulatory Agency, said at the time that “the big winner” of the legislative changes initiated by the PSD deputy Iulian Iancu “are those from Gazprom“.

Razvan Nicolescu wrote on Facebook: “We are starting to become ridiculous in Brussels on topics that are not really important for Romania. The representatives in Brussels have understood very well that the big winner of these changes is Gazprom. This is the main reason why they oppose!“.

Commissioner Canete was asked on Tuesday about the amendments made in the Parliament to the Emergency Ordinance 64/2016, according to which 70% of the natural gas produced in Romania will have to be traded on a single market, OPCOM, in a context in which the European Commission has already opened an infringement process against Romania for blocking the gas exports.

We have a legislative package on energy and one of the issues refers to the liberalization of the market. It is a complex process with different phases of transition. In this process, the European Commission encourages the dialogue instead of going to the Court of Justice, where procedures are long, and we shall waste time,” the European official said.

He pointed out that approving the EO 64 in the Parliament would have meant the compliance with the European law and the end of the infringement procedure.

It is clear that Romania is at a crossroads in the energy sector, especially in the gas market. It is clear, regarding the EO 64, we had some expectation that this ordinance would be approved in Romania and we would not go further with the infringement procedure. The fact that the ordinance is now blocked in the Parliament shows that things are not going in the right direction,” Canete said.

According to him, the European Commission has proposed some solutions to overcome this blockage and encouraged everyone to have a balanced attitude.

According to Iulian Iancu’s amendments, OPCOM, a state-owned company, would have a monopoly on the operation of centralized natural gas markets, and producers will have to trade, as of January 1, 2018, 70% of the production, a share that the Government would increase every year, “until reaching the 100% quota”.

The MPs have made the incriminated decision despite the fact that “the Ministry of Energy, the Ministry of Economy, the Competition Council, ANRE, the associations of market participants, the market participants, the associations from the European Union, the Energy Directorate – the regulator of the regulators, associations of commodities exchanges, broker associations, EFET (European energy traders) associations expressed their opposition,” said Septimiu Stoica, BRM President, in May, at an energy conference organized by cursdeguvernare.ro.

The suspicion that Iulian Iancu might be serving “foreign interests” was also shared by American officials in the past. In the diplomatic notes sent to Washington by the US Embassy in Bucharest, published by Wikileaks, the Americans are worried at some point about some Romanian politicians’ closeness to Moscow. Among them, the notes mention Iulian Iancu, whose party colleague, Georgian Pop, at that time the head of the Committee on the Control of SRI, said he is controlled by Gazprom.

Iulian Iancu is known in Brussels as an anti-European person. In 2015, PSD Deputy Iulian Iancu and Bulgarian representative Stankov Zhecho Donchev received the lowest number of votes among the candidates who competed for a position in the Administrative Board of the European Agency for the Cooperation of Energy Regulators.

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