WRITTEN QUESTION E-1680/01 by Benedetto Della Vedova (TDI) to the Commission. Acquisition by EDF of a stake in Montedison SpA.
Date: 2001-06-14
Institutions: European Parliament, Provisional data
Subjects: France, State aid, company buyout, competition law, electrical energy, energy production, liberalisation of the market

C 81 E/50

Official Journal of the European Communities

EN

4.4.2002

Answer given by Mrs de Palacio on behalf of the Commission

(4 September 2001)

The Community and its Member States, in 1997, agreed in the Kyoto Protocol to the United Nations
Framework Convention on Climate Change (UNFCCC) to reduce their greenhouse gas emissions by 8 %
below 1990 levels in the period 2008 to 2012. Nuclear energy has contributed so far significantly to
stabilise and reduce Community(cid:146)s greenhouse gas emissions.

Currently, nuclear energy accounts for around 15 % of the Community primary energy supply and 35 % of
electricity generated in the Community. According to current analysis, under business as usual conditions
and taking into consideration that some Member States with nuclear plants have decided to phase-out
nuclear, the contribution of Europe(cid:146)s nuclear power is seen as peaking in about 2010. Some nuclear power
plants are projected to reach their operating lifetime over the next two decades. Consequently, nuclear
output will decrease unless new nuclear power plants are put into operation or existing installations are
upgraded and their lifetime extended. In this context, the Member States deciding to phase out nuclear
energy should have assessed their ability for doing so while still attaining their Kyoto objectives and their
Community burden-sharing commitments.

The Commission believes that the greenhouse gas emissions reductions needed to achieve the Community(cid:146)s
Kyoto targets can be achieved through a variety of measures mainly in the tertiary and household sectors,
in industry, in transport and in power generation at low to medium cost. The European Climate Change
Programme has already indicated a number of options for policies and measures that,
if adopted at
Community level and fully implemented by all Member States, could meet the Kyoto objective.

In a longer perspective the issues facing us on energy, in particular the environmental dimension, requires
serious debate due to the fears about high increase of Carbondioxide (CO2) emissions and the probable
requirement for further strengthening of the policy to mitigate them. The Commission(cid:146)s Green Paper
(cid:145)Towards a European strategy for the security of energy supply (1)(cid:146) makes an important contribution to this
open debate about the future fuel mix of Europe(cid:146)s energy balance. The objective of Energy policy is to
provide the European industry and the European citizens in the 21st century with secure, competitive and
environmentally friendly energy services, facilitating the achievement of the Climate Change commitment.

(1) COM(2000) 769 final.

(2002/C 81 E/061)

WRITTEN QUESTION E-1680/01

by Benedetto Della Vedova (TDI) to the Commission

(14 June 2001)

Subject: Acquisition by EDF of a stake in Montedison SpA

According to press reports, ElectricitØ de France (EDF) has recently acquired a 3,97 % stake of Montedison
SpA(cid:146)s capital.

EDF, which is the world leader in the production of electrical energy (the company has 18 % of the
European electricity market and aims to have secured 50 % of the market by 2005), is entirely controlled
by the French government and operates on French territory as a monopoly.

4.4.2002

EN

Official Journal of the European Communities

C 81 E/51

France has consistently ignored the European directive that requires EU Member States to open up their
national electricity and gas markets, while the Commission has responded by opening the infringement
procedure and requesting France to comply with Community law. The electricity market has been opened
up to a far lesser extent in France than in most other countries of the Union and this will continue to be
the case for many years to come. France(cid:146)s halting progress in comparison to the liberalisation under way in
other countries has enabled the EDF to use the resources derived from its monopoly position to support its
aggressive policy of expansion in the European market.

The argument that the acquisition of the holding in question should be regarded as a purely financial
lacks credibility given the obvious connection between the sectors in which EDF and
investment
Montedison operate and the former company(cid:146)s strategic interest in gaining a foothold in the Italian market
in the generation and distribution of electrical energy, which is in the process of being liberalised.

In view of the foregoing, would the Commission state what steps it intends to take in respect of EDF to
ensure that the monopoly position the latter enjoys does not continue to adversely affect competition in
the electrical energy sector? Would the Commission also state whether it agrees that, in view of the fact
that the French national market continues to be dominated by a monopoly, the situation described above
indirectly constitutes the granting of state aid to the EDF, which is incompatible with Article 87 of the EC
Treaty and infringes Article 82 of the Treaty by effectively exporting to the Italian market the dominant
position which EDF occupies in France?

Answer given by Mr Monti on behalf of the Commission

(3 September 2001)

In line with the conclusions of the Stockholm European Council (23 and 24 March 2001) agreed by the
Heads of State and Government, the Commission will ensure that the provisions of the EC Treaty are fully
observed in the electricity sector during the process of liberalisation and that those companies which still
benefit from a monopoly situation on their national market do not unduly benefit from that situation.

The matter to which the Honourable Member refers, the acquisition by ElectricitØ de France (EdF) of a
stake in Montedison SpA, has taken on a new dimension since, after acquiring 20 % of the capital of
Montedison SpA, EdF went on to create a joint venture, Italenergia, in association with other Italian firms.
That undertaking has just made a takeover bid for Montedison. The current shareholders in Italenergia are
FIAT, EdF, Tassara and three Italian banks (Banca di Roma, San Paolo and Intesa). The Commission is now
to Council
carefully assessing the latest operation, which was notified on 26 July 2001 pursuant
Regulation (EEC) No 4064/89 of 21 December 1989 on the control of concentrations between
undertakings (1). After Italenergia(cid:146)s shareholding structure was amended, the Commission came to the
conclusion, on 20 July, that this was indeed a concentration with a Community dimension and accordingly
invited Italenergia and FIAT to submit appropriate notification. The Commission will, in addition, continue
to monitor developments very closely to assess whether there are grounds for Articles 81 (ex Article 85)
and 82 (ex Article 86) of the EC Treaty to be applied.

As for the Honourable Member(cid:146)s suggestion that EdF received aid from the French Government
the Commission is currently examining the provisions of French
incompatible with the EC Treaty,
regulations which govern EdF(cid:146)s area of activity in order to determine whether these provisions could be
interpreted as state aid. Among other aspects, the relationship between EdF and the State as a shareholder
will be examined with reference to the market investor principle.

The Commission considers, moreover, that the most effective way of resolving the problems relating to
imbalances in the progress of liberalisation in the various Member States pinpointed by the Honourable
Member is to adopt the draft electricity liberalisation directive, which is more far-reaching than those
approved by the Council and the European Parliament in 1996 and 1998 and forms part of a package of
measures announced on 20 June 2000 aimed at ensuring the full application of competition rules in the
energy sector.

(1) OJ L 257, 21.9.1990.