Amended proposal for a Directive of the European Parliament and of the Council amending Directives 96/92/EC and 98/30/EC concerning rules for the internal markets in electricity and natural gas (presented by the Commission pursuant to Article 250 (2) of the EC-Treaty)
Date: 2002-06-07
Institutions: European Commission
Subjects: domestic market, electrical energy, energy distribution, energy grid, energy production, energy supply, energy transport, liberalisation of trade, market access, natural gas

24.9.2002

EN

Official Journal of the European Communities

C 227 E/393

Amended proposal for a directive of the European Parliament and of the Council amending
Directives 96/92/EC and 98/30/EC concerning rules for the internal markets in electricity and
natural gas (1)

(2002/C 227 E/19)

(Text with EEA relevance)

COM(2002) 304 final — 2001/0077(COD)

(Submitted by the Commission pursuant to Article 250(2) of the EC Treaty on 7 June 2002)

(1) OJ C 240 E, 28.8.2001, p. 60.

INITIAL PROPOSAL

AMENDED PROPOSAL

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE
EUROPEAN UNION,

Unchanged

Having regard to the Treaty establishing the European
Community, and in particular Article 47(2), Article 55 and
Article 95 thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the Economic and Social
Committee,

Having regard to the opinion of the Committee of the Regions,

Acting in accordance with the procedure laid down in Article
251 of the Treaty,

Whereas:

(1) Directive 96/92/EC of the European Parliament and of the
Council of 19 December 1996 concerning common rules
in electricity (1) and Directive
for the internal market
98/30/EC of
the
the European Parliament
Council of 22 June 1998 concerning common rules for
the internal market in natural gas (2) have made very
important contributions towards the creation of internal
markets for electricity and gas.

and of

(2) Experience in implementing those Directives demonstrates
the benefits that have begun to result from the internal
markets in electricity and gas, in terms of efficiency gains,
price reductions, higher standards of service and increased
important shortcomings and
competitiveness. However,
possibilities
the
for
markets remain,

functioning of

improving

the

___________
(1) OJ L 27, 30.1.1997, p. 20.
(2) OJ L 204, 21.7.1998, p. 1.

for

improving

(2) Experience in implementing those Directives demonstrates
the benefits that have begun to result from the internal
markets in electricity and gas, in terms of efficiency gains,
price reductions, higher standards of service and increased
important shortcomings and
competitiveness. However,
possibilities
the
markets remain, notably in ensuring a level playing field
in generation and addressing the risks of predatory
behaviour, ensuring non-discriminatory transmission and
distribution tariffs, through access to the network on the
basis of tariffs published prior to their entry into force,
the rights of small and vulnerable
and ensuring that
information on fuel
customers are protected and that
sources for electricity generation is disclosed.

functioning of

the

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Official Journal of the European Communities

24.9.2002

INITIAL PROPOSAL

AMENDED PROPOSAL

(3) At its meeting in Lisbon on 23 and 24 March 2000, the
European Council called for rapid work to be undertaken
to complete the internal market in both electricity and gas
sectors and to speed up liberalisation in these sectors with
a view to achieving a fully operational internal market.
The European Parliament, in its Resolution of 6 July 2000
on the Commission's second report on the state of
the
energy markets,
liberalisation
Commission to adopt a detailed timetable
the
achievement of accurately defined objectives with a view
to gradually but completely liberalising the energy market.

requested
for

of

Unchanged

(4) The freedoms which the Treaty guarantees European
citizens — free movement of goods, freedom to provide
services and freedom of establishment — are only
possible in a fully open market, which enables all
consumers
suppliers and all
suppliers freely to deliver to their customers.

freely to choose their

(5) In view of

the anticipated increase in dependency as
regards natural gas consumption, consideration should
to encourage
be given to initiatives and measures
reciprocal
to third-country
networks and market integration.

arrangements

access

for

(4) The main obstacles in arriving at a fully operational
internal market are related to issues of access to the
network different degrees of market opening between
Member States.

(6) The main obstacles in arriving at a fully operational
internal market are related to issues of access to the
network, network
degrees of
market opening between Member States and different
approaches to internalisation of external costs.

tarification,

different

(7) For competition to function, network access must be
priced.
transparent

non-discriminatory,
fairly
Favourable investment conditions should exist.

and

(5) In order to achieve non-discriminatory access to the
network, the independence of the transmission system
operator is of paramount importance. The provisions on
unbundling should therefore be strengthened. In order to
ensure non-discriminatory access
to the distribution
network, unbundling requirements for the distribution
system operator should be introduced for both electricity
and gas distribution system operators.

(8) In order to achieve non-discriminatory access to the
network, the independence of the transmission system
operator is of paramount importance. The provisions on
unbundling should therefore be strengthened. In order to
ensure non-discriminatory access
to the distribution
network, unbundling requirements for the distribution
system operator should be introduced for both electricity
and gas distribution system operators.

(6) To avoid imposing a disproportionate financial and
administrative burden on small distribution companies,
Member States
to
exempt
unbundling
such
requirements.

should be able, where necessary,
companies

from the

(9) To avoid imposing a disproportionate financial and
administrative burden on small distribution companies,
to
Member States
exempt
unbundling
such
requirements.

should be able, where necessary,
companies

from the

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INITIAL PROPOSAL

AMENDED PROPOSAL

(7) Further measures should be taken in order to ensure
transparent, predictable and non-discriminatory tariffs
for access to essential transportation and related infra-
structure, including storage and other ancillary facilities.
Those tariffs should be applicable to all system users on a
non-discriminatory basis.

(10) Further measures should be taken in order to ensure
transparent, predictable and non-discriminatory tariffs
for access to essential transportation and related infra-
structure, including storage and other ancillary facilities.
Those tariffs should be applicable to all system users on a
non-discriminatory basis.

(8) In the light of the experience gained with the operation of
Council Directive 90/547/EEC of 29 October 1990 on the
transit of electricity through transmission grids (1) and
Council Directive 91/296/EEC of 31 May 1991 on the
transit of natural gas through grids (2), measures should be
taken to ensure homogeneous and non-discriminatory
access regimes for transmission,
including cross-border
flows between Member States.

(11) In the light of the experience gained with the operation of
Council Directive 90/547/EEC of 29 October 1990 on the
transit of electricity through transmission grids (1) and
Council Directive 91/296/EEC of 31 May 1991 on the
transit of natural gas through grids (2), measures should be
taken to ensure homogeneous and non-discriminatory
access regimes for transmission,
including cross-border
flows of gas and electricity between Member States.

(9) The of national regulatory authorities,

is an important
feature in guaranteeing non-discriminatory access to the
least have the
network. Those authorities
transmission and
competence
to
distribution tariffs and tariffs
to liquefied
natural gas (LNG) facilities. prior to their entry into force.

for access

should at

approve

fix

or

guaranteeing

non-discriminatory

(12) The existence of effective regulation, carried out by
is an important feature
national regulatory authorities,
access
the
to
in
network. Those authorities
least have the
competence to fix or approve the tariffs, or at least, the
methodologies underlying the calculation of transmission
and distribution tariffs and tariffs for access to liquefied
natural gas
should be
published prior to their entry into force.

facilities. These tariffs

should at

(LNG)

(13) In order

for new
to ensure effective market access
entrants, non-discriminatory and cost-reflective balancing
mechanisms are necessary. As soon as the electricity and
gas markets are sufficiently liquid, this should be achieved
through the setting up of transparent market-based mech-
anisms for the supply and purchase of electricity and gas
needed in the framework of balancing requirements. In
the absence of such liquid markets, national regulatory
authorities should play an active role to ensure that
balancing
cost-
reflective.

non-discriminatory

tariffs

and

are

(10) National regulatory authorities should be able to approve
tariffs on the basis of a proposal by the transmission
system operator or distribution system operator(s) or
LNG system operator, or on the basis of a proposal
agreed between these operator(s) and the users of the
network.

(14) National regulatory authorities should be able to fix or
approve tariffs, or
the methodologies underlying the
calculation ot the tariffs, on the basis of a proposal by
the transmission system operator or distribution system
operator(s) or LNG system operator, or on the basis of a
proposal agreed between these operator(s) and the users
of the network. In carrying out these tasks, national regu-
latory authorities should ensure that
transmission and
are non-discriminatory and cost-
distribution tariffs
the long-term,
reflective, and should take account of
marginal,
from distributed
avoided network
generation and demand-side management measures.

costs

___________
(1) OJ L 313, 13.11.1990, p. 30. Directive as last amended by
Commission Directive 98/75/EC (OJ L 276, 13.10.1998, p. 9).

___________
(1) OJ L 313, 13.11.1990, p. 30. Directive as last amended by
Commission Directive 98/75/EC (OJ L 276, 13.10.1998, p. 9).

(2) OJ L 147, 12.6.1991, p. 37. Directive as

last amended by

(2) OJ L 147, 12.6.1991, p. 37. Directive as

last amended by

Commission Directive 95/49/EC (OJ L 233, 30.9.1995, p. 86).

Commission Directive 95/49/EC (OJ L 233, 30.9.1995, p. 86).

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INITIAL PROPOSAL

AMENDED PROPOSAL

(11) The benefits resulting from the internal market should be
available to all Community industry and commerce,
including small and medium-sized enterprises, and to all
Community citizens as quickly as possible, for reasons of
competitiveness employment

(15) The benefits resulting from the internal market should be
available to all Community industry and commerce,
including small and medium-sized enterprises, and to all
Community citizens as quickly as possible, for reasons of
fairness,
to create
employment as a result of the efficiency gains that will
be enjoyed by enterprises.

competitiveness,

indirectly,

and

supplier

(12) Gas and electricity customers should be able to choose
their
freely. Nonetheless a phased approach
should be taken to completing the internal market for
electricity and gas, coupled, to enable industry to adjust
and ensure that adequate measures and systems are in
place to protect the interests of customers and ensure
they have a real and effective right to choose supplier.

(16) Gas and electricity customers should be able to choose
their supplier
freely. Nonetheless, a phased approach
should be taken to completing the internal market for
electricity and gas, coupled with a specific deadline, to
enable industry to adjust and ensure that adequate
the
measures and systems are in place to protect
interests of customers and ensure they have a real and
effective right to choose supplier.

(13) Progressive market opening towards

full competition
should gradually remove differences between Member
States. Transparency and certainty in the implementation
of this Directive should be ensured.

(17) Progressive market opening towards

full competition
should gradually remove differences between Member
States. Transparency and certainty in the implementation
of this Directive should be ensured.

(14) Directive 98/30/EC provides for access to storage as part
of the gas system. In the light of the experience gained in
implementing the internal market, additional measures
should be taken to clarify the provisions for access to
storage and other ancillary services and to reinforce the
separation of
transmission and
operation of
distribution systems, and gas storage and LNG facilities.

the

(18) Directive 98/30/EC provides for access to storage as part
of the gas system. In the light of the experience gained in
implementing the internal market, additional measures
should be taken to clarify the provisions for access to
storage and other ancillary services and to reinforce the
separation of
transmission and
operation of
distribution systems, and gas storage and LNG facilities.

the

(15) Nearly all Member States have

chosen to ensure
competition in the electricity generation market through
a transparent authorisation procedure. However, Member
States should have the possibility to ensure security of
supply through the launching of a tendering procedure
in the event that sufficient electricity generation capacity
is not built on the basis of the authorisation procedure.

(16) In the interest of security of supply, the supply/demand
balance in individual Member States should be monitored,
if security of supply is compromised.

(19) Nearly

all Member States have

chosen to ensure
competition in the electricity generation market through
a transparent authorisation procedure. However, Member
States should have the possibility to ensure security of
supply through the launching of a tendering procedure
in the event that sufficient electricity generation capacity
is not built on the basis of the authorisation procedure.

(20) In the interest of security of supply, the supply/demand
balance in individual Member States should be monitored,
followed by a report on the situation at Community level,
taking account of interconnection capacity between areas.
Such monitoring should be carried out sufficiently early
to enable appropriate measures to be taken if security of
supply is compromised. The construction and main-
tenance
infrastructure,
including interconnection capacity, should contribute to
ensuring a stable electricity and gas supply.

necessary

network

the

of

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INITIAL PROPOSAL

AMENDED PROPOSAL

(21) Member States should ensure that biogas and gas from
biomass is granted non-discriminatory access to the gas
system, provided such access is compatible with the
relevant technical rules and safety standards.

(22) Long-term contracts will continue to be an important part
of the gas supply of Member States and should be main-
tained as an option for gas supply undertakings in so far
as they do not undermine the objectives of this Directive
and are compatible with the Treaty, including competition
rules.

(17) Member States should ensure that all customers enjoy the
right to be supplied with electricity of a specified quality
at affordable and reasonable prices. In order to ensure the
maintenance of the highest possible standards of public
service in the Community, all measures taken by Member
States to achieve the objectives of this Directive should be
regularly notified to the Commission. The Commission
should regularly publish a report analysing measures
taken at national level to achieve public service objectives
and comparing their effectiveness, with a view to making
recommendations as regards measures to be taken at
national level to achieve high public service standards.

clearly

affordable,

transparent

comparable,

(23) Member States should ensure that all customers enjoy the
right to be supplied with electricity of a specified quality
at
and
reasonable prices. Member States should also ensure that
all
final customers connected to the gas system are
informed about their rights to be supplied with natural
gas of a specified quality at reasonable prices. In order to
ensure the maintenance of the highest possible standards
of public service in the Community, all measures taken by
Member States to achieve the objectives of this Directive
should be regularly notified to the Commission. The
Commission should regularly publish a report analysing
measures taken at national level to achieve public service
objectives and comparing their effectiveness, with a view
to making recommendations as regards measures to be
taken at national
to achieve high public service
standards.

level

(18) The requirement to notify the Commission of any refusal
to grant authorisation to construct new generation
capacity has proven to be an unnecessary administrative
burden and should therefore be dispensed with.

(24) The requirement to notify the Commission of any refusal
to grant authorisation to construct new generation
capacity has proven to be an unnecessary administrative
burden and should therefore be dispensed with.

(19) In accordance with the principles of subsidiarity and
proportionality as set out in Article 5 of the Treaty, the
objectives of the proposed action, namely the creation of
fully operational
internal electricity and gas markets, in
which fair competition prevails, cannot be sufficiently
achieved by the Member States and can therefore, by
reason of the scale and effects of the action, be better
achieved by the Community. This Directive confines
to achieve
itself
those objectives and does not go beyond what
is
necessary for that purpose.

to the minimum required in order

internal electricity and gas markets,

(25) In accordance with the principles of subsidiarity and
proportionality as set out in Article 5 of the Treaty, the
objectives of the proposed action, namely the creation of
fully operational
in
which fair competition prevails, cannot be sufficiently
achieved by the Member States and can therefore, by
reason of the scale and effects of the action, be better
achieved by the Community. This Directive confines
to achieve
itself
those objectives and does not go beyond what
is
necessary for that purpose.

to the minimum required in order

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INITIAL PROPOSAL

AMENDED PROPOSAL

(20) To ensure homogeneity in the treatment of access to the
electricity and gas networks, also in the case of transit,
Directives 90/547/EEC and 91/296/EEC should be
repealed.

(26) To ensure homogeneity in the treatment of access to the
electricity and gas networks, also in the case of transit,
Directives 90/547/EEC and 91/296/EEC should be
repealed.

(21) Directives 96/92/EC and 98/30/EC should therefore be

(27) Directives 96/92/EC and 98/30/EC should therefore be

amended accordingly.

amended accordingly.

(28) This Directive

and
the
observes the principles recognised in particular by the
Charter of Fundamental Rights of the European Union,

fundamental

respects

rights

HAVE ADOPTED THIS DIRECTIVE:

Unchanged

Article 1

Amendments to Directive 96/92/EC

Directive 96/92/EC is amended as follows:

1. Articles 1, 2 and 3 are replaced by the following:

‘Article 1

rules

common

establishes

This Directive
the
generation, transmission, distribution and supply of elec-
tricity. It lays down the rules relating to the organisation
and functioning of
the electricity sector, access to the
market, the criteria and procedures applicable to calls for
tender
and the
operation of systems.

and the granting of

authorisations

for

Article 2

For the purposes of this Directive:

1. “generation” shall mean the production of electricity;

2. “producer”

shall mean a natural or

legal person

generating electricity;

3. “autoproducer” shall mean a natural or legal person
generating electricity essentially for its own use;

4. “independent producer” shall mean:

(a) a producer who does not carry out electricity
in the
transmission or distribution functions
territory covered by the system where it is estab-
lished;

(b) in Member States in which vertically integrated
undertakings do not exist and where a tendering
procedure is used, a producer corresponding to
(a), who may not be
the definition of point
exclusively subject
to the economic precedence
of the interconnected system;

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INITIAL PROPOSAL

AMENDED PROPOSAL

5. “transmission” shall mean the transport of electricity
on the high-voltage interconnected system with a view
to its delivery to final customers or to distributors,

5. “transmission” shall mean the transport of electricity
on the high-voltage interconnected system with a view
to its delivery to final customers or to distributors, but
not including supply;

6. “transmission system operator” shall mean a natural or
legal person responsible for operating, ensuring the
maintenance of and, if necessary, developing the trans-
mission system in a given area and, where applicable,
its
systems, and for
ensuring the long-term ability of the system to meet
reasonable demands for the transmission of electricity;

interconnections with other

6. “distribution” shall mean the transport of electricity on
medium-voltage and low-voltage distribution systems
with a view to its delivery to customers;

7. “distribution” shall mean the transport of electricity on
medium-voltage and low-voltage distribution systems
with a view to its delivery to customers, but not
including supply;

8. “distribution system operator” shall mean a natural or
legal person responsible for operating, ensuring the
maintenance of and,
if necessary, developing the
distribution system in a given area and, where
applicable,
its interconnections with other systems
and for ensuring the long-term ability of the system
to meet reasonable demands for the distribution of
electricity;

7. “customers” shall mean wholesale and final customers

9. “customers” shall mean wholesale and final customers

of electricity

of electricity;

8. “wholesale customers” shall mean any natural or legal

persons

10. “wholesale customers” shall mean any natural or legal
persons who purchase electricity for the purpose of
resale inside or outside the system where they are
established;

9. “final customer” shall mean a customer purchasing

11. “final customer” shall mean a customer purchasing

electricity for own use;

electricity for his/her own use;

12. “household

customer”

customer
purchasing electricity for his/her own household
consumption, excluding commercial or professional
activities;

shall mean

a

10. “non-customer” shall mean

13. “non-household customer” shall mean any natural or
legal person purchasing electricity which is not for its
own household use and shall include producers and
wholesale customers;

14. “eligible customers” shall mean customers who have
electricity in

suppliers of

to competitive
access
accordance with this Directive;

11. “interconnectors” shall mean equipment used to link

15. “interconnectors” shall mean equipment used to link

electricity systems;

electricity systems;

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INITIAL PROPOSAL

AMENDED PROPOSAL

12. “interconnected system” shall mean a number of trans-
mission and distribution systems linked together by
means of one or more interconnectors;

16. “interconnected system” shall mean a number of trans-
mission and distribution systems linked together by
means of one or more interconnectors;

13. “direct line” shall mean

17. “direct line” shall mean either an electricity line linking
an isolated production site with an isolated customer
or an electricity line linking an electricity producer
and an electricity supply undertaking to supply
directly their own premises, subsidiaries and eligible
customers;

14. “economic precedence” shall mean the ranking of
sources of electricity supply in accordance with
economic criteria;

18. “economic precedence” shall mean the ranking of
sources of electricity supply in accordance with
economic criteria;

15. “ancillary services” shall mean all services necessary
for the operation of a transmission or distribution
system;

19. “ancillary services” shall mean all services necessary
for the operation of a transmission or distribution
system;

16. “system user” shall mean any natural or legal person
supplying to, or being supplied by, a transmission or
distribution system;

20. “system user” shall mean any natural or legal person
supplying to, or being supplied by, a transmission or
distribution system;

17. “supply”

shall mean the

sale of

electricity

to

21. “supply”

shall mean the

sale of

electricity

to

customers;

customers;

18. “integrated electricity undertaking”

shall mean a

22. “integrated electricity undertaking”

shall mean a

vertically or horizontally integrated undertaking;

vertically or horizontally integrated undertaking;

19. “vertically integrated undertaking”

shall mean an

undertaking

23. “vertically integrated undertaking”

shall mean an
undertaking or a group of undertakings whose
mutual relationships are defined in Article 3(3) of
Council Regulation (EEC) No 4064/89 (*) and where
the undertaking/group concerned is performing at
least two or more of the functions of transmission,
distribution, generation and supply of electricity;

20. “horizontally integrated undertaking” shall mean an
undertaking performing at least one of the functions
of generation for sale, or transmission, or distribution,
or supply of electricity, and another non-electricity
activity;

24. “horizontally integrated undertaking” shall mean an
undertaking performing at least one of the functions
of generation for sale, or transmission, or distribution,
or supply of electricity, and another non-electricity
activity;

21. “tendering procedure”

shall mean the procedure
through which planned additional requirements and
replacement capacity are covered by supplies from
new or existing generating capacity;

25. “tendering procedure”

shall mean the procedure
through which planned additional requirements and
replacement capacity are covered by supplies from
new or existing generating capacity;

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INITIAL PROPOSAL

AMENDED PROPOSAL

22. “long-term planning” shall mean the planning of the
need for investment in generation and transmission
capacity on a long-term basis, with a view to
meeting the demand for electricity of
the system
and securing supplies to customers;

26. “long-term planning” shall mean the planning of the
need for investment in generation and transmission
and distribution capacity on a long-term basis, with
a view to meeting the demand for electricity of the
system and securing supplies to customers;

23. “small

isolated system” shall mean any system with
consumption of
less than 2 500 GWh in the year
1996, where less than 5 % of annual consumption is
obtained through interconnection with other systems;

27. “small

isolated system” shall mean any system with
consumption of less than 2 500 GWh in the year
1996, where less than 5 % of annual consumption is
obtained through interconnection with other systems;

28. “energy imbalance” shall mean the difference between
the quantity of electricity notified to the transmission
or distribution system operator for injection or with-
drawal at one or more given locations over a given
time period and the metered quantity of electricity
withdrawn or
injected at one or more given
locations over the same time period;

29. “security” shall mean both security of supply and

provision of electricity, and technical safety;

30. “energy

efficiency/demand-side management”

shall
mean a global or
integrated approach aimed at
influencing the amount and timing of electricity
consumption in order
to reduce primary energy
consumption and peak loads by giving precedence
to investments
in energy efficiency measures, or
other measures, such as interruptible supply contracts,
over investments to increase generation capacity,
if
the former are the most effective and economical
option, taking into account the positive environmental
reduced energy consumption and the
impact of
security of
supply and distribution cost aspects
related to it;

31. “renewable energy sources”

shall mean renewable
non-fossil energy sources (wind, solar, geothermal,
gas,
wave,
sewage treatment plant gas and biogases);

tidal, hydropower,

biomass,

landfill

32. “distributed generation” shall mean generation plants
connected to the low-voltage distribution system;

33. “disclosure” shall mean making available in aggregate
form commercial
information associated with the
production of electricity and relating to the sources
used to produce electricity, their location, or environ-
mental impact.

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INITIAL PROPOSAL

AMENDED PROPOSAL

Article 3

Unchanged

subsidiarity,

1. Member States shall ensure, on the basis of their
institutional organisation and with due regard for the
to
principle of
paragraph 2, electricity undertakings are operated in
accordance with the principles of this Directive, with a
view to achieving a competitive market
in electricity,
and shall not discriminate between these undertakings as
regards either rights or obligations.

that, without prejudice

2.
Having full regard to the relevant provisions of the
Treaty, in particular Article 86 thereof, Member States may
impose on undertakings operating in the electricity sector,
in the general economic interest, public service obligations
which may relate to security, including security of supply,
regularity, quality and price of supplies and environmental
protection. Such obligations shall be clearly defined, trans-
parent, non-discriminatory and verifiable.
In relation to
referred to in this paragraph
security of
Member States may introduce the implementation of
long-term planning, taking into account the possibility of
third parties seeking access to the system.

supply, as

3. Member States shall ensure that all customers enjoy
universal service,
that is the right to be supplied with
electricity of a specified quality within their territory at
reasonable prices.

subsidiarity,

1. Member States shall ensure, on the basis of their
institutional organisation and with due regard for the
to
principle of
paragraph 2, electricity undertakings are operated in
accordance with the principles of this Directive, with a
view to achieving a competitive and sustainable market
in electricity, and shall not discriminate between these
undertakings as regards either rights or obligations.

that, without prejudice

2.
Having full regard to the relevant provisions of the
Treaty, in particular Article 86 thereof, Member States may
impose on undertakings operating in the electricity sector,
in the general economic interest, public service obligations
which may relate to security, including security of supply,
regularity, quality and price of supplies and environmental
protection, including energy efficiency climate protection.
Such obligations shall be clearly defined,
transparent,
non-discriminatory and verifiable. In relation to security
of
supply, energy efficiency/demand-side management
and for the fulfilment of environmental goals, as referred
to in this paragraph, Member States may introduce the
implementation of
into
account the possibility of third parties seeking access to
the system.

long-term planning,

taking

a

3. Member States shall ensure that all final customers
enjoy universal service, that is the right to be supplied
with electricity of
specified quality within their
reasonable prices. To that end, Member
territory at
States may appoint a supplier of
last resort. Member
States shall
impose on distribution companies an obli-
gation to connect customers to their grid under terms,
in accordance with the
and tariffs
conditions
procedure laid down in Article 22, 2.

set

final customers, and shall

4. Member States shall take appropriate measures to
protect
in particular ensure
there. They shall ensure high levels of consumer
that
to transparency
protection, particularly with respect
regarding
and conditions, general
information and dispute settlement mechanisms. These
measures shall include, in particular, those set out in the
Annex.

contractual

terms

final customers, and shall

4. Member States shall take appropriate measures to
protect
in particular ensure
that there are adequate safeguards to protect vulnerable
In this context, Member
customers from disconnection.
States may take appropriate measures to protect
final
customers in remote areas. They shall ensure high levels
of consumer protection, particularly with respect to trans-
and conditions,
parency regarding contractual
general
information and dispute settlement mechanisms.
Member States shall ensure that the eligible customer is
effectively able to switch to a new supplier. These
measures shall include, in particular, those set out in the
Annex.

terms

24.9.2002

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INITIAL PROPOSAL

AMENDED PROPOSAL

5. Member States shall ensure that electricity suppliers
specify in the bills and in all advertising and promotional
materials made available to final customers:

(a) the percentage contribution of each energy source to
the commercial fuel mix for the electricity supplied;

(b) the overall fuel mix of the supplier over the preceding

year;

(c) the relative importance of each energy source with

respect to the production of greenhouse gases.

With respect
exchange,
provided
exchange over the preceding year may be used.

to electricity obtained via an electricity
the

aggregate

figures

the

by

5. Member States shall implement appropriate measures
to achieve the objectives of social and economic cohesion,
environmental protection, and security of supply, for the
maintenance and construction of the necessary network
infrastructure, including interconnection capacity.

6. Member States shall implement appropriate measures
to achieve the objectives of social and economic cohesion,
environmental protection, which may include energy effi-
ciency/demand-side management measures and means to
combat climate change, and security of supply. Such
measures may include,
the provision of
adequate economic incentives, using, where appropriate,
all existing national and Community tools, for the main-
tenance and construction of the necessary network infra-
structure, including interconnection capacity.

in particular,

6. Member States may decide not
to apply the
provisions of Articles 5, 6, 16 and 21 in so far as their
application would obstruct the performance, in law or in
fact, of the obligations imposed on electricity undertakings
in the general economic interest and in so far as the
development of trade would not be affected to such an
the
extent as would be contrary to the interests of
Community. The interests of
the Community include,
inter alia, competition with regard to eligible customers
in accordance with this Directive and Article 86 of the
Treaty.’

7. Member States may decide not
to apply the
provisions of Articles 5, 6, 16 and 21 in so far as their
application would obstruct the performance, in law or in
fact, of the obligations imposed on electricity undertakings
in the general economic interest and in so far as the
development of trade would not be affected to such an
the
extent as would be contrary to the interests of
Community. The interests of
the Community include,
inter alia, competition with regard to eligible customers
in accordance with this Directive and Article 86 of the
Treaty.

consumer

8. Member States shall, upon implementation of this
Directive, notify the Commission of all measures adopted
to fulfil universal service and public service obligations,
including
environmental
protection
protection, and their possible effect on national and inter-
such measures
national competition, whether or not
require a derogation from this Directive. They shall
inform the Commission subsequently every two years of
any changes to such measures, whether or not they require
a derogation from this Directive.

and

___________
(*) OJ L 257, 21.9.90, p. 13.’

C 227 E/404

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INITIAL PROPOSAL

AMENDED PROPOSAL

2. Article 4 is deleted.

Unchanged

3. Articles 5 and 6 are replaced by the following:

‘Article 5

1.
For the construction of new generating capacity,
Member States shall adopt an authorisation procedure,
which shall be conducted in accordance with objective,
transparent and non-discriminatory criteria.

lay down the criteria for the
2. Member States shall
grant of authorisations for the construction of generating
capacity in their territory. These criteria may relate to:

(a) the safety and security of the electricity system, instal-

lations and associated equipment;

(b) protection of public health and safety;

(c) protection of the environment;

(d) land use and siting;

(e) use of public ground;

(f) energy efficiency;

(g) the nature of the primary sources;

(h) characteristics particular

to the applicant,
technical, economic and financial capabilities;

such as

(i) compliance with measures adopted pursuant to Article

3.

3. Member States shall take appropriate measures to
streamline and expedite authorisation procedures
for
small and/or distributed generation. These measures shall
less than 15 MW and to all
apply to all
distributed generation.

facilities of

The authorisation procedures and criteria shall be
3.
made public. Applicants shall be informed of the reasons
for any refusal to grant an authorisation. The reasons must
be objective, non-discriminatory, well founded and duly
substantiated. Appeal procedures shall be made available
to the applicant.

The authorisation procedures and criteria shall be
4.
made public. Applicants shall be informed of the reasons
for any refusal to grant an authorisation. The reasons must
be objective, non-discriminatory, well founded and duly
substantiated. Appeal procedures shall be made available
to the applicant.

24.9.2002

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Official Journal of the European Communities

C 227 E/405

INITIAL PROPOSAL

AMENDED PROPOSAL

Article 6

Unchanged

1. Member States shall ensure the possibility,
in the
interests of security of supply, to tender for new on the
basis of published criteria. A tendering procedure can,
however, only be launched if on the basis of the author-
isation procedure
the generating capacity being not
sufficient to ensure security of supply.

supply

security of

in the
1. Member States shall ensure the possibility,
interests of
and environmental
protection, to tender for new capacity or energy efficiency/
demand-side management measures on the basis of
published criteria. A tendering procedure can, however,
the authorisation
only be launched if on the basis of
procedure the generating capacity being built or
the
efficiency/demand-side management measures
energy
being taken are not
to ensure security of
supply and to meet environmental targets.

sufficient

capacity

2. Member States may ensure the possibility,
in the
interests of environmental protection and the promotion
of infant new technologies, to tender for new capacity on
the basis of published criteria. This tender may relate to
efficiency/demand-side
new
energy
management measures. A tendering procedure
can,
however, only be launched if on the basis of the author-
isation procedure the generating capacity being built or
the measures being taken are not sufficient to achieve
these objectives.

or

Details of

2.
the tendering procedure for means of
generating capacity shall be published in the Official
the European Communities at least six months
Journal of
prior to the closing date for tenders.

Details of

3.
the tendering procedure for means of
generating capacity and energy efficiency/demand-side
management measures shall be published in the Official
the European Communities at least six months
Journal of
prior to the closing date for tenders.

The tender specifications shall be made available to any
interested undertaking established in the territory of a
Member State so that it has sufficient time in which to
submit a tender.

Unchanged

tender

to be

the contract

specifications

shall
contain a
specifications and of

The
detailed
description of
the
tenderers and an
followed by all
procedure
exhaustive list of criteria governing the selection of
tenderers and the award of
the contract, which are
covered by the tender. These specifications may also
relate to the fields referred to in Article 5(2).

tender

to be

the contract

specifications

shall
contain a
specifications and of

The
detailed
description of
the
tenderers and an
followed by all
procedure
exhaustive list of criteria governing the selection of
tenderers and the award of
including
incentives, such as subsidies, which are covered by the
tender. These specifications may also relate to the fields
referred to in Article 5(2).

contract,

the

3.
In invitations to tender for the requisite generating
capacity, consideration must also be given to electricity
supply offers with long-term guarantees from existing
generating units, provided that additional requirements
can be met in this way.

4.
In invitations to tender for the requisite generating
capacity, consideration must also be given to electricity
supply offers with long-term guarantees from existing
generating units, provided that additional requirements
can be met in this way.

C 227 E/406

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Official Journal of the European Communities

24.9.2002

INITIAL PROPOSAL

AMENDED PROPOSAL

4. Member States shall designate an authority or a
public body or a private body independent of electricity
generation, transmission, distribution and supply activities,
to be responsible for the organisation, monitoring and
control of
referred to in
tendering procedure
paragraphs 1 to 4. This authority or body shall take all
necessary steps to ensure confidentiality of the information
contained in the tenders.’

the

5. Member States shall designate an authority or a
public body or a private body independent of electricity
generation, transmission, distribution and supply activities,
which may be a national regulatory authority referred to
in Article 22(1), to be responsible for the organisation,
monitoring and control of
tendering procedure
referred to in paragraphs 1 to 4. Where a transmission
system operator is fully independent from other activities
not relating to the transmission system in ownership
terms, the transmission system operator may be designated
as the body responsible for organising, monitoring and
controlling the tendering procedure. This authority or
body shall take all necessary steps to ensure confidentiality
of the information contained in the tenders.’

the

4. The following Article 6a is inserted:

Unchanged

‘Article 6a

future

demand

shall ensure the monitoring of security of supply issues.
in particular, cover the supply/
This monitoring shall,
the level of
demand balance on the national market,
expected
additional
capacity under planning or construction. They shall
publish, by 31 July each year at
the latest a report
outlining the findings resulting from the monitoring of
these issues, as well as any measures taken or envisaged
to address
to the
Commission forthwith.’

them and forward this

envisaged

report

and

the

cover

the national

Member States or
regulatory authorities
referred to in Article 22(1) shall ensure the monitoring
in
of security of supply issues. This monitoring shall,
particular,
supply/demand balance on the
national market, the level of expected future demand and
envisaged
or
capacity
construction, and the quality and level of maintenance of
the networks. They shall publish, by 31 July each year at
the latest, a report outlining the findings resulting from the
monitoring of these issues, as well as any measures taken
or envisaged to address them and forward this report to
the Commission forthwith.’

additional

planning

under

5. Article 7 is replaced by the following:

Unchanged

‘Article 7

1. Member States shall designate or shall require under-
takings which own transmission systems to designate, for a
period of time to be determined by Member States having
regard to considerations of efficiency and economic
balance, transmission system operators.

1. Member States shall designate or shall require under-
takings which own transmission systems to designate, for a
period of time to be determined by Member States having
regard to considerations of efficiency and economic
balance, one or more transmission system operators.

Unchanged

for

the

2. Member States shall ensure that technical rules estab-
lishing the minimum technical design and operational
requirements
system of
connection to the
installations, distribution systems, directly
generating
interconnector circuits
connected consumers' equipment,
and direct
lines are developed and published. These
requirements shall ensure the interoperability of systems
and shall be objective and non-discriminatory. They shall
be notified to the Commission in accordance with Article
8 of Council Directive 98/34/EC (*).

24.9.2002

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C 227 E/407

INITIAL PROPOSAL

AMENDED PROPOSAL

For the purposes of this Directive, the transmission

3.
system operator shall be responsible for:

(a) ensuring the long-term ability of the system to meet
reasonable demands for the transmission of electricity;

(b) contributing to security of supply through adequate

transmission capacity and system reliability;

(c) managing energy flows on the system,

taking into
account exchanges with other interconnected systems.
To that end, the transmission system operator shall be
responsible for ensuring a secure, reliable and efficient
electricity system and, in that context, for ensuring the
availability of all necessary ancillary services;

its

(d) providing to the operator of any other system with
sufficient
which
system is
information to ensure
and efficient
operation, co-ordinated development and interoper-
ability of the interconnected system;

interconnected
secure

the

(e) the non-discrimination as between system users or
classes of system users, particularly in favour of its
subsidiaries or shareholders.

Unless the system operator is already fully independent
from other activities not
relating to the transmission
system in terms of ownership, the system operator shall
be independent at least in terms of its legal form, organi-
sation and decision making from other activities not
relating to transmission.

4.
Unless the transmission system operator is already
fully independent from other activities not relating to the
transmission system in terms of ownership, the system
operator, within the integrated electricity undertaking,
shall be independent at least in terms of its legal form,
organisation and decision making from other activities not
relating to transmission.

In order to ensure the independence of the transmission
system operator,
the following minimum criteria shall
apply:

Unchanged

(a) those persons responsible for the management of the
transmission system operator may not participate in
company structures of the integrated electricity under-
taking responsible, directly or
the
indirectly,
day-to-day operation of
the generation, distribution
and supply of electricity;

for

of

(b) appropriate measures must be taken to ensure that the
interests
the
persons
the transmission system are taken
management of
into account in a manner that ensures that they are
capable of acting independently;

responsible

the

for

(b) appropriate measures must be taken to ensure that the
professional interests of the persons responsible for the
management of the transmission system operator are
taken into account in a manner that ensures that they
are capable of acting independently;

(c) the transmission system operator must have effective
decision-making rights,
from the inte-
grated electricity undertaking, with respect to assets
necessary to maintain or develop the network;

independent

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Official Journal of the European Communities

24.9.2002

INITIAL PROPOSAL

AMENDED PROPOSAL

that discriminatory

(d) the transmission system operator must establish a
compliance programme, which sets out measures
is
taken to ensure
excluded. The programme must set out the specific
obligations of employees to meet
It
must be drawn up and its respect monitored by a
compliance officer. An annual report, setting out the
measures taken, must be submitted by the compliance
officer to the national regulatory authority referred to
in Article 22(1) and published.

this objective.

conduct

(*) OJ L 204, 21.7.1998, p. 37.’

Unchanged

6. The following Article 7a is inserted:

‘Article 7a

Transmission system operators shall procure the energy
functions
they use
according to transparent, non-discriminatory and market
based procedures.’

carrying out of

their

the

for

7. In Article 8, the following paragraphs 5 and 6 are added:

‘5. Member States may require transmission system
operators for the maintenance and development of the
transmission system, including interconnection capacity.

‘5. Member States may require transmission system
operators to comply with minimum standards for the
maintenance
transmission
the
development of
system, including interconnection capacity.

and

6.
Rules adopted by transmission system operators for
balancing shall be objective, transparent and non-discrimi-
natory,
the
transmission system
provision of
operators shall’

such services by

the charging of.

including rules

for

for

6.
Rules adopted by transmission system operators for
balancing the electricity system shall be objective, trans-
parent and non-discriminatory,
including rules for the
charging of system users of their networks for energy
imbalance. Terms and conditions,
including rules and
tariffs, for the provision of such services by transmission
to a
system operators
a
in
methodology
non-discriminatory and cost-reflective way and shall be
published.’

shall be established pursuant
compatible with Article 22(2)

8. Articles 9 and 10 are replaced by the following:

Unchanged

‘Article 9

the transmission system operator must preserve the confi-
dentiality of commercially sensitive information obtained
in the course of carrying out its business

Without prejudice to Article 13 or any other legal duty to
the transmission system operator
disclose information,
must
commercially
of
confidentiality
the
preserve
sensitive information obtained in the course of carrying
out its business, and shall prevent information about its
own activities which may be commercially advantageous
being disclosed in a discriminatory manner.

24.9.2002

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Official Journal of the European Communities

C 227 E/409

INITIAL PROPOSAL

AMENDED PROPOSAL

Article 10

Unchanged

1. Member States shall designate or shall require under-
takings
that own or are responsible for distribution
systems to designate one or more distribution system
operators. Member States shall ensure that distribution
system operators act in accordance with Articles 10(2),
11 and 12.

from other

Unless the system operator is already fully inde-
2.
to the
activities not
pendent
the system
distribution system in terms of ownership,
operator shall be independent at
its
legal form, organisation and decision making from other
activities not relating to distribution.

in terms of

relating

least

Unless the distribution system operator is already
2.
fully independent from other activities not relating to the
distribution system in terms of ownership, the distribution
system operator within the integrated electricity under-
taking shall be independent at least in terms of its legal
form, organisation and decision making from other
activities not relating to distribution.

In order to ensure the independence of the distribution
system operator, the following criteria shall apply:

In order to ensure the independence of the distribution
the following minimum criteria shall
system operator,
apply:

(a) those persons responsible for the management of the
distribution system operator may not participate in
company structures of the integrated electricity under-
taking responsible, directly or
the
day-to-day operation of the generation, transmission
and supply of electricity;

indirectly,

for

Unchanged

(b) appropriate measures must be taken to ensure that the
professional interests of the persons responsible for the
management of the distribution system operator are
taken into account
in a manner that ensures that
they are capable of acting independently;

(c) the distribution system operator shall have sufficient
decision-making rights,
from the inte-
grated electricity undertaking, with respect to assets
necessary for the maintenance and development of
the network;

independent

that discriminatory

(d) the distribution system operator must establish a
compliance programme which sets out measures
taken to ensure
is
excluded. The programme must set out the specific
obligations of employees to meet
It
must be drawn up and its respect monitored by a
compliance officer. An annual report, setting out the
measures taken, must be submitted by the compliance
officer to the national regulatory authority referred to
in Article 22(1), and published.

this objective.

conduct

shall apply from. Member States may decide not to apply
this paragraph to integrated electricity undertakings
serving less than 100 000 customers.’

This paragraph shall apply from 1 January 2004. Member
States may decide not to apply this paragraph to integrated
electricity
than 100 000
customers.’

undertakings

serving

less

C 227 E/410

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INITIAL PROPOSAL

AMENDED PROPOSAL

9. The following Article 10a is inserted:

Unchanged

‘Article 10a

Distribution system operators shall procure the energy
they use to cover energy losses and reserve capacity in
their system according to transparent, non-discriminatory
and market based procedures.’

10. In Article 11, the following paragraphs 4 and 5 are added:

‘4. Where distribution system operators are responsible
rules
for balancing the electricity distribution system,
adopted by them for that purpose shall be objective, trans-
parent and non-discriminatory,
including rules for the
charging of system users of their networks for energy
imbalance. Terms and conditions,
including rules and
tariffs, for the provision of such services by distribution
system operators shall be established in accordance with
Article 22(2)
in a non-discriminatory and cost-reflective
way and shall be published.

5. When planning the development of the distribution
efficiency/demand-side management
network,
generation that might
measures
distributed
supplant
electricity
capacity shall be considered by the distribution system
operator.’

energy
and/or
the need to upgrade or

replace

11. Article 12 is replaced by the following:

Unchanged

‘Article 12

the distribution system operator must preserve the confi-
dentiality of commercially sensitive information obtained
in the course of carrying out its business’

Without prejudice to Article 13 or any other legal duty to
disclose information, the distribution system operator must
preserve
the confidentiality of commercially sensitive
information obtained in the course of carrying out its
information about
business, and shall prevent
its own
activities which may be
commercially advantageous
being disclosed in a discriminatory manner.’

12. The following Article 12a is inserted:

Unchanged

‘Article 12a

The rules in Articles 7(4) and 10(4) do not prevent the
operation of a combined transmission and distribution
system operator, which is fully independent in terms of
its legal
form, organisation and decision making from
other activities not relating to transmission or distribution
system operation and which meets the requirements of
Article 7(4).’

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INITIAL PROPOSAL

AMENDED PROPOSAL

13. Article 13 is replaced by the following:

‘Article 13

Member States or any competent authority they designate,
including the national regulatory authorities referred to in
shall have right of access to the accounts of generation,
transmission, distribution undertakings which they need to
consult in carrying out their checks.’

Member States or any competent authority they designate,
including the national regulatory authorities referred to in
Article 22(1) shall have right of access to the accounts of
generation, transmission, distribution and supply under-
takings which they need to consult in carrying out their
checks.’

14. In Article 14, paragraph 3 is replaced by the following:

Unchanged

in their
‘3.
shall,
Integrated electricity undertakings
internal accounting, keep separate accounts,
their
for
transmission, distribution, generation activities, as they
would be required to do if
the activities in question
were carried out by separate undertakings, with a view
cross-subsidisation
to
and
distortion of competition. shall
include a balance sheet
and a profit and loss account for each activity.’

discrimination,

avoiding

in their
‘3.
shall,
Integrated electricity undertakings
internal accounting, keep separate accounts,
their
for
transmission, distribution, generation and supply activities,
as they would be required to do if the activities in question
were carried out by separate undertakings, with a view to
avoiding discrimination, cross-subsidisation and distortion
of competition. They shall keep separate accounts for
supply activities for eligible customers and supply activities
for non-eligible customers. Revenue from ownership of the
transmission/distribution system shall be specified in the
accounts. Where appropriate, they shall keep consolidated
accounts for other, non-electricity activities. The internal
accounts shall include a balance sheet and a profit and loss
account for each activity.

3a. Member States may decide that companies with an
annual production not exceeding 1 TWh are not obliged
to publish separate accounts for generation and supply.
regulatory
They shall, at
authority referred to in Article 22(1), provide
the
unbundled accounts to that authority.’

the request of

the national

15. Article 15 is deleted.

Unchanged

16. Article 16 is replaced by the following:

‘Article 16

1. Member States shall ensure the implementation of a
system of
third party access to the transmission and
distribution systems based on published tariffs, applicable
to all eligible customers and applied objectively and
are
without
approved prior to their entry into force by a national
regulatory authority referred to in Article 22(1)

system users.

discrimination

between

third-party access

1. Member States shall ensure the implementation of a
system of
to the transmission and
distribution systems based on published tariffs, applicable
to all eligible customers and applied objectively and
without discrimination between system users. Member
States shall ensure that these tariffs, or the methodologies
underlying their calculation, are approved prior to their
regulatory authority
entry into force by a national
referred to in Article 22(1) and that
these tariffs are
published prior to their entry into force.

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INITIAL PROPOSAL

AMENDED PROPOSAL

2.
The operator of a transmission or distribution system
may refuse access where it lacks the necessary capacity.
Duly substantiated reasons must be given for such refusal,
in particular having regard to Article 3.’

2.
The operator of a transmission or distribution system
may refuse access where it lacks the necessary capacity.
Duly substantiated reasons must be given for such refusal,
in particular having regard to Article 3. Member States
shall ensure, where appropriate and when refusal of
access takes place, that the transmission or distribution
on
system operator
the
measures
network. The party requesting such information may be
charged a reasonable fee reflecting the cost of providing
such information.’

information
that would be necessary to reinforce

provides

relevant

17. Articles 17 and 18 are deleted.

Unchanged

18. Article 19 is replaced by the following:

‘Article 19

The eligible customers are the customers which are
their
shall

1.
free to purchase electricity from the supplier of
choice within the Community. Member States
ensure that these eligible customers are:

(a) until 1 January 2004,

the eligible customers as
specified in Article 19(1)
to 19(3) of Directive
96/92/EC. Member States shall publish by 31 January
each year the criteria for the definition of these eligible
customers;

(b) from 1 January 2004 at the latest, all non-household

customers;

(c) from 1 January 2005 at the latest, all customers.

To avoid imbalance in the opening of electricity

2.
markets:

Unchanged

(a) contracts for the supply of electricity with an eligible
customer in the system of another Member State shall
not be prohibited if
the customer is considered as
eligible in both systems involved;

(b) in cases where transactions as described in point (a) are
refused because of the customer being eligible only in
one of the two systems, the Commission may oblige,
taking into account the situation in the market and the
common interest, the refusing party to execute the
requested electricity supply at
the
Member State where the eligible customer is located.’

the request of

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Official Journal of the European Communities

C 227 E/413

INITIAL PROPOSAL

AMENDED PROPOSAL

19. Article 20 is deleted.

20. Articles 21 and 22 are replaced by the following:

‘Article 21

1. Member States shall take the necessary measures to

1. Member States shall take the necessary measures to
enable:

(a) all electricity producers and electricity supply within
their
premises,
supply
subsidiaries and eligible customers through a direct
line;

territory

their

own

to

(a) all electricity producers and electricity supply under-
takings, established within their territory to supply
their
eligible
customers through a direct line;

subsidiaries

premises,

own

and

(b) any eligible customer within their

territory to be
line by a producer and

supplied through a direct
supply

(b) any eligible customer within their

territory to be
line by a producer and

supplied through a direct
supply undertakings.

2. Member States shall
lay down the criteria for the
the construction of direct
grant of authorisations for
lines in their territory. These criteria must be objective
and non-discriminatory.

Unchanged

3.
The possibility of supplying electricity through a
direct line as referred to in paragraph 1 shall not affect
the possibility of contracting electricity in accordance with

3.
The possibility of supplying electricity through a
direct line as referred to in paragraph 1 shall not affect
the possibility of contracting electricity in accordance with
Article 16.

4. Member States may make authorisation to construct
a direct line subject either to the refusal of system access
on the basis, as appropriate, of or to the opening of a
dispute settlement procedure under

4. Member States may make authorisation to construct
a direct line subject either to the refusal of system access
on the basis, as appropriate, of Article 16 or to the
opening of a dispute settlement procedure under Article
22.

5. Member States may refuse to authorise a direct line if
the granting of such an authorisation would obstruct the
provisions of Article 3. Duly substantiated reasons must be
given for such refusal.

Unchanged

Article 22

States

designate one or more
shall
1. Member
regulatory authorities.
competent bodies
as national
These authorities shall be wholly independent of
the
interests of the electricity industry. They shall at least be
to
responsible for continuously monitoring the market
ensure non-discrimination, effective competition and the
efficient
in particular with
respect to:

functioning of

the market,

(a) the level of competition;

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(b) the rules on the management and allocation of inter-
connection capacity, in conjunction with the national
regulatory authority or authorities of those Member
States with which interconnection exists;

(c) any mechanisms

to deal with congested capacity

within the national electricity system;

(d) the time taken by transmission and distribution under-

takings to make connections and repairs;

(e) the publication of appropriate information by trans-
mission and distribution system operators concerning
interconnectors, grid usage and capacity allocation to
interested parties, taking into account the need to treat
non-aggregated information as commercially confi-
dential;

(f)

the effective unbundling of accounts, as referred to in
to ensure there are no cross-subsidies
Article 14,
between generation,
transmission, distribution and
supply activities. For this purpose they shall have
access to the accounts;

(g) the terms, conditions and tariffs for connecting new
these are
producers of electricity to guarantee that
objective,
in
particular taking full account of the benefits of the
various
technologies,
distributed generation and combined heat and power.

and non-discriminatory,

transparent

renewable

sources

energy

2.
The national regulatory authorities shall at least be
responsible for fixing, approving or proposing prior to
their
the methodologies used to
calculate or establish the terms and conditions for:

into force,

entry

(a) connection and access to national networks, including

transmission and distribution tariffs;

(b) the provision of balancing services.

National

regulatory

authorities

the
3.
authority to require transmission and distribution system
operators,
and
conditions, tariffs, rules, mechanisms and methodologies
referred to in paragraph 2,
they are
reasonable and applied in a non-discriminatory manner.

to ensure that

if necessary,

shall have

to modify

terms

the

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to the national

4.
Any party having a complaint against a transmission
or distribution system operator with respect to the issues
the
mentioned in paragraphs 1, 2 and 3 may refer
regulatory authority which,
complaint
acting as dispute settlement authority,
issue a
decision within two months after receipt of the complaint.
This period may be extended by two months where
additional information is sought by the national regulatory
authority. This period may be further extended with the
agreement of the complainant. Any appeal against such a
decision shall not have suspensive effect.

shall

Where a complaint concerns connection tariffs for major
new generation facilities, the two-month period may be
extended by the national regulatory authority.

1. Member States shall take measures to ensure that
national regulatory authorities are able to carry out their
duties referred to in paragraphs 1 to 4 in an efficient and
expeditious manner.

5. Member States shall take measures to ensure that
national regulatory authorities are able to carry out their
duties referred to in paragraphs 1 to 4 in an efficient and
expeditious manner.

2. Member States shall create appropriate and efficient
mechanisms for regulation, control and transparency so as
to avoid any abuse of dominant position, in particular to
the detriment of consumers, and any predatory behaviour.
These mechanisms shall take account of the provisions of
the Treaty, and in particular Article 82 thereof.

6. Member States shall create appropriate and efficient
mechanisms for regulation, control and transparency so as
to avoid any abuse of dominant position, in particular to
the detriment of consumers, and any predatory behaviour.
These mechanisms shall take account of the provisions of
the Treaty, and in particular Article 82 thereof.

the appropriate
3. Member States shall ensure that
measures are taken,
including administrative action or
criminal proceedings in conformity with their national
responsible
law, against
where confidentiality rules
imposed by this Directive
have not been respected.’

the natural or

legal persons

the appropriate
7. Member States shall ensure that
measures are taken,
including administrative action or
criminal proceedings in conformity with their national
responsible
law, against
where confidentiality rules
imposed by this Directive
have not been respected.

the natural or

legal persons

In the event of cross-border disputes, the national
8.
regulatory authority shall be the national
regulatory
authority covering the system operator which refuses use
of, or access to, the system.

9.
Recourse to the national regulatory authority shall be
without prejudice to the exercise of rights of appeal under
Community law.’

21. The following Article 23a is inserted:

Unchanged

‘Article 23a

Member States shall inform the Commission of imports of
electricity,
that have taken place during the previous
calendar year from third countries.’

Member States shall inform the Commission every three
months of
in terms of physical
flows, that have taken place during the previous calendar
year from third countries.’

imports of electricity,

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22. Article 24 is replaced by the following:

Unchanged

‘Article 24

for

their

small

the operation of

Member States which can demonstrate, after the Directive
has been brought into force, that there are substantial
problems
isolated
systems, may apply for derogations from the relevant
provisions of Chapters IV, V, VI, VII, which may be
granted to them by the Commission. The latter shall
inform the Member States of those applications prior to
taking a decision, taking into account respect for confi-
dentiality. This decision shall be published in the Official
the European Communities. This shall also be
Journal of
applicable to Luxembourg.’

for

their

small

the operation of

Member States which can demonstrate, after the Directive
has been brought into force, that there are substantial
problems
isolated
systems, may apply for derogations from the relevant
provisions of Chapters IV, V, VI, VII, which may be
granted to them by the Commission. The latter shall
inform the Member States of those applications prior to
taking a decision, taking into account respect for confi-
dentiality. This decision shall be published in the Official
Journal of the European Communities. This Article shall also
be applicable to Luxembourg.’

23. Article 25 is deleted.

Unchanged

24. Article 26 is replaced by the following:

‘Article 26

The Commission shall monitor and review the
this Directive and submit an overall
to the European Parliament and the

1.
application of
report
progress
Council. The report shall at least cover:

The Commission shall monitor and review the
1.
this Directive and submit an overall
application of
to the European Parliament and the
report
progress
Council before the end of the first year following the
entry into force of this Directive, and thereafter on an
annual basis. The report shall at least cover:

(a) the experience gained and progress made in creating a
complete and fully operational internal market in elec-
tricity and the obstacles that remain in this respect,
including aspects of market dominance, concentration
in the market, predatory or anti-competitive behaviour;

(b) the extent to which the unbundling and tarification
requirements contained in this Directive have been
in ensuring fair and non-discriminatory
successful
to the Community's electricity system and
access
equivalent
the
levels of competition, as well as
economic, environmental and social consequences of
the opening of the electricity market for customers;

(c) an examination of issues relating to system capacity
levels and security of supply of electricity in the
and
Community,
projected balance between demand and supply, taking
into account
the physical capacity for exchanges
between areas;

and in particular

existing

the

(d) a general assessment of the progress achieved with
regard to bilateral
relations with third countries
which produce and export or transport electricity,
including progress in market
trade and
access to the networks of such third countries;

integration,

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(e) the need for possible harmonisation requirements that
are not linked to the provisions of this Directive.

Where appropriate, this report may include recommen-
dations.

Unchanged

those measures and,

Every two years, the report referred to in paragraph
2.
1, shall also cover an analysis of the different measures
taken in the Member States to meet public service obli-
gations, together with an examination of the effectiveness
their effects on
of
competition in the electricity market. Where appropriate,
this
to the
measures to be taken at national
level to achieve high
public service standards, or measures intended to prevent
market foreclosure.’

report may include recommendations as

in particular,

25. The Annex, the text of which is set out in Annex I to this

Directive, is added.

Article 2

Amendments to Directive 98/30/EC

Directive 98/30/EC is amended as follows:

1. Articles 1, 2 and 3 are replaced by the following:

‘Article 1

This Directive establishes common rules for the trans-
mission, distribution, supply and storage of natural gas.
It lays down the rules relating to the organisation and
functioning of the natural gas sector,
including liquefied
natural gas (LNG), access to the market, the operation of
systems, and the criteria and procedures applicable to the
granting of authorisations for transmission, distribution,
supply and storage of natural gas.

This Directive establishes common rules for the trans-
mission, distribution, supply and storage of natural gas.
It lays down the rules relating to the organisation and
functioning of the natural gas sector,
including liquefied
natural gas (LNG), access to the market, the operation of
systems, and the criteria and procedures applicable to the
granting of authorisations for transmission, distribution,
supply and storage of natural gas. The rules established
by this Directive for natural gas shall also apply to
biogas and gas from biomass in so far as such gases can
technically and safely be injected into the natural gas
system.

Article 2

Unchanged

For the purposes of this Directive:

1. “natural gas undertaking” means any natural or legal
the following
person carrying out at
functions:
distribution,
production,
supply, purchase or storage of natural gas, including
LNG, which is
commercial,
technical and/or maintenance tasks related to those
functions, but shall not include final customers;

least one of
transmission,

responsible

the

for

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2. “upstream pipeline network” means any pipeline or
network of pipelines operated and/or constructed as
part of an oil or gas production project, or used to
convey natural gas from one or more such projects to
a processing plant or terminal or final coastal landing
terminal;

3. “transmission” means the transport of natural gas
through a high pressure pipeline network other than
an upstream pipeline network with a view to its
delivery to customers;

3. “transmission” means the transport of natural gas
through a high-pressure pipeline network other than
an upstream pipeline network with a view to its
delivery to customers, but not including supply;

4. “transmission system operator” means a natural or
legal person who carries out the function of trans-
mission and is responsible for operating, ensuring
the maintenance of, and, if necessary, developing the
transmission system in a given area and, where
applicable,
its interconnections with other systems,
and to ensure the long-term ability of the system to
meet reasonable demands for the transportation of
gas;

4. “distribution” means

the transport of natural gas
through local or regional pipeline networks with a
view to its delivery to customers;

5. “distribution” means

the transport of natural gas
through local or regional pipeline networks with a
view to its delivery to customers, but not including
supply;

6. “distribution system operator” means a natural or legal
person who carries out the function of distribution
and is responsible for operating, ensuring the main-
tenance of,
the
distribution system in a given area and, where
applicable,
its interconnections with other systems,
and to ensure the long-term ability of the system to
meet reasonable demands for the distribution of gas;

if necessary,

developing

and,

5. “supply” means the sale of natural gas, including LNG,

7. “supply” means the sale of natural gas, including LNG,

to customers;

to customers;

6. “supply undertaking” means any natural or
person who carries out the function of supply;

legal

8. “supply undertaking” means any natural or
person who carries out the function of supply;

legal

7. “storage facility” means a facility used for the stocking
of natural gas and owned and/or operated by a natural
gas undertaking, including the part of LNG facilities
used for storage but excluding the portion used for
production operations;

9. “storage facility” means a facility used for the stocking
of natural gas and owned and/or operated by a natural
gas undertaking, including the part of LNG facilities
used for storage but excluding the portion used for
production operations;

8. “storage” means a natural or legal person who carries

out the function of storage;

10. “storage system operator” means a natural or legal
person who carries out the function of storage and
is responsible for operating a storage facility;

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9. “LNG facility” means a terminal which is used for the
and

gas or, offloading,

liquefaction of natural
re-gaseification of LNG,

11. “LNG facility” means a terminal which is used for the
liquefaction of natural gas or
importation,
offloading, and re-gaseification of LNG, but shall not
include any part of LNG terminals used for storage;

the

10. “LNG system operator” means a natural or

legal
person who carries out the function of liquefaction
of natural gas, or the offloading, storage and re-gaseifi-
cation of LNG and is responsible for operating a LNG
facility;

12. “LNG system operator” means a natural or

legal
person who carries out the function of liquefaction
of natural gas, or the offloading, storage and re-gaseifi-
cation of LNG and is responsible for operating a LNG
facility;

11. “system” means any transmission networks and/or
distribution networks and/or LNG facilities owned
and/or operated by a natural gas undertaking,
including its facilities supplying ancillary services and
those of related undertakings necessary for providing
access to transmission and distribution;

13. “system” means any transmission networks and/or
distribution networks and/or LNG facilities owned
and/or operated by a natural gas undertaking,
including its facilities supplying ancillary services and
those of related undertakings necessary for providing
access to transmission and distribution;

12. “ancillary services” means all services necessary for the
distribution
transmission
including storage
load

operation
networks and/or LNG facilities
facilities and equivalent
balancing and blending;

flexibility instruments,

and/or

of

14. “ancillary services” means all services necessary for the
distribution
transmission
including storage
load

operation
networks and/or LNG facilities
facilities and equivalent
balancing and blending;

flexibility instruments,

and/or

of

15. “flexibility instrument” means any instrument, which
may help balance the gas demand load of customers
with gas supply and includes storage facilities, flexi-
bility in the LNG chain and linepack;

13. “interconnected system” means a number of systems

16. “interconnected system” means a number of systems

which are linked with each other;

which are linked with each other;

14. “direct

line” means a natural gas pipeline comple-

17. “direct

line” means a natural gas pipeline comple-

mentary to the interconnected system;

mentary to the interconnected system;

15. “integrated natural gas undertaking” means a vertically

18. “integrated natural gas undertaking” means a vertically

or horizontally integrated undertaking;

or horizontally integrated undertaking;

16. “vertically integrated undertaking” means a natural gas
undertaking performing at least two or more of the
functions of
transmission, distribution, production,
supply and storage of natural gas;

19. “vertically integrated undertaking” means a natural gas
undertaking or a group of undertakings whose mutual
relationships are defined in Article 3(3) of Council
Regulation (EEC) No 4064/89 and where the under-
taking/group concerned is performing at least two or
more of the functions of transmission, distribution,
production, supply and storage of natural gas;

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17. “horizontally integrated undertaking” means an under-
taking performing at least one of the functions of
supply or
transmission, distribution,
production,
storage of natural gas, and a non-gas activity;

20. “horizontally integrated undertaking” means an under-
taking performing at least one of the functions of
supply or
transmission, distribution,
production,
storage of natural gas, and a non-gas activity;

18. “related undertaking” means affiliated undertakings,
the Seventh
within the meaning of Article 41 of
Council Directive, 83/349/EEC,
associated
undertakings, within the meaning of Article 33(1)
thereof, and/or undertakings which belong to the
same shareholders;

and/or

21. “related undertaking” means affiliated undertakings,
the Seventh
within the meaning of Article 41 of
Council Directive, 83/349/EEC,
associated
undertakings, within the meaning of Article 33(1)
thereof, and/or undertakings which belong to the
same shareholders;

and/or

19. “system user” means any natural or

legal person

22. “system user” means any natural or

legal person

supplying to, or being supplied by, the system;

supplying to, or being supplied by, the system;

20. “customers” means wholesale and final customers of
natural gas and natural gas undertakings which
purchase natural gas;

23. “customers” means wholesale and final customers of
natural gas and natural gas undertakings which
purchase natural gas;

24. “household customer” means a customer purchasing
natural gas for his/her own household consumption;

25. “non-household

customer” means

purchasing natural gas which is not
household use;

a
customer
for its own

21. “final customer” means a customer purchasing natural

26. “final customer” means a customer purchasing natural

gas for his/her own use;

gas for his/her own use;

22. “wholesale customers” inside or outside the system

where they are established;

27. “eligible customer” means a customer who is free to
purchase gas from the supplier of his or her choice, in
the meaning of Article 18;

28. “wholesale customers” means any natural or legal
persons other
than transmission system operators
and distribution system operators who purchase
natural gas
resale inside or
the purpose of
outside the system where they are established;

for

23. “long-term planning” means the planning of supply
and transportation capacity of natural gas under-
takings on a long-term basis with a view to meeting
the demand for natural gas of the system, diversifi-
cation of sources and securing supplies to customers;

29. “long-term planning” means the planning of supply
and transportation capacity of natural gas under-
takings on a long-term basis with a view to meeting
the demand for natural gas of the system, diversifi-
cation of sources and securing supplies to customers;

24. “emergent market” means a Member State in which
the first commercial supply of
long-term
natural gas supply contract was made not more
than 10 years earlier;

its first

30. “emergent market” means a Member State in which
the first commercial supply of
long-term
natural gas supply contract was made not more
than 10 years earlier;

its first

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25. “security”

31. “security of supply” means both security of supply of

natural gas, and technical safety;

32. “energy imbalance” means the difference between the
quantity of gas notified to the transmission or
distribution system operator for injection or with-
drawal at one or more given locations over a given
time period and the metered quantity of gas
withdrawn or
injected at one or more given
locations over the same time period.

Article 3

Unchanged

subsidiarity,

1. Member States shall ensure, on the basis of their
institutional organisation and with due regard for the
principle of
to
paragraph 2, natural gas undertakings are operated in
accordance with the principles of this Directive with a
view to achieving a competitive market in natural gas,
and shall not discriminate between such undertakings as
regards either rights or obligations.

that, without prejudice

subsidiarity,

1. Member States shall ensure, on the basis of their
institutional organisation and with due regard for the
principle of
to
paragraph 2, natural gas undertakings are operated in
accordance with the principles of this Directive with a
view to achieving a competitive and sustainable market
in natural gas, and shall not discriminate between such
undertakings as regards either rights or obligations.

that, without prejudice

Having full regard to the relevant provisions of the
2.
Treaty, in particular Article 86 thereof, Member States may
impose on natural gas undertakings,
in the general
economic interest, public service obligations which may
relate to security, including security of supply, regularity,
quality
environmental
protection. Such obligations shall be clearly defined, trans-
parent, non-discriminatory and verifiable. Member States
long-term
may
third
planning,
parties seeking access to the system.

the
taking into account

the possibility of

implementation

and price

introduce

supplies,

and

of

of

3. Member States shall take appropriate measures to
final customers and to ensure high levels of
protect
consumer protection, and shall. They shall ensure high
levels of consumer protection, particularly with respect
to transparency regarding general contractual terms and
information and dispute settlement
conditions, general
in particular,
include,
mechanisms. These measures shall
those set out in the Annex.

of

and price

Having full regard to the relevant provisions of the
2.
Treaty, in particular Article 86 thereof, Member States may
impose on natural gas undertakings,
in the general
economic interest, public service obligations which may
relate to security, including security of supply, regularity,
environmental
quality
protection,
climate
and
protection. Such obligations shall be clearly defined, trans-
parent, non-discriminatory and verifiable.
In relation to
security of supply, and the fulfilment of environmental
including energy efficiency, Member States may
goals,
long-term planning,
introduce the implementation of
taking into account
third parties
seeking access to the system.

and
efficiency

the possibility of

including

supplies,

energy

are

adequate

safeguards

3. Member States shall take appropriate measures to
final customers and to ensure high levels of
protect
consumer protection, and shall, in particular, ensure that
there
to protect vulnerable
customers from disconnection. In this context, they may
take appropriate measures to protect customers in remote
areas who are connected to the gas system. Member States
may appoint a supplier of
for customers
connected to the gas network. They shall ensure high
levels of consumer protection, particularly with respect
to transparency regarding general contractual terms and
conditions, general
information and dispute settlement
mechanisms. Member States shall ensure that the eligible
customer is effectively able to switch to a new supplier.
These measures shall include, in particular, those set out in
the Annex.

resort

last

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4. Member States shall implement appropriate measures
to achieve the objectives of social and economic cohesion,
environmental protection, and security of supply, for the
maintenance and construction of necessary network infra-
structure, including interconnection capacity.

4. Member States shall implement appropriate measures
to achieve the objectives of social and economic cohesion,
environmental protection, which may include means to
combat climate change, and security of supply. Such
measures may include,
the provision of
adequate economic incentives, using, where appropriate,
all existing national and Community tools, for the main-
tenance and construction of necessary network infra-
structure, including interconnection capacity.

in particular,

5. Member States may decide not to apply Article 5
with respect to distribution insofar as their application
would obstruct, in law or in fact, the performance of the
obligations imposed on natural gas undertakings in the
general economic interest and insofar as the development
of trade would not be affected to such an extent as would
be contrary to the interests of
the Community. The
interests of the Community include, inter alia, competition
with regard to eligible customers in accordance with this
Directive and Article 86 of the Treaty.’

5. Member States may decide not to apply Article 5
with respect to distribution in so far as their application
would obstruct, in law or in fact, the performance of the
obligations imposed on natural gas undertakings in the
general economic interest and in so far as the development
of trade would not be affected to such an extent as would
be contrary to the interests of
the Community. The
interests of the Community include, inter alia, competition
with regard to eligible customers in accordance with this
Directive and Article 86 of the Treaty.

6. Member States shall, upon implementation of this
Directive, notify the Commission of all measures adopted
to achieve public service obligations, including consumer
and environmental protection, and their possible effect on
national and international competition, whether or not
such measures require a derogation from the provisions
of
this Directive. They shall notify the Commission
subsequently every two years of any changes to such
measures, whether or not they require a derogation from
this Directive.’

2. The following Article 4a is inserted:

Unchanged

‘Article 4a

shall ensure the monitoring of security of supply issues.
in particular, cover the supply/
This monitoring shall,
demand balance on the national market,
the level of
expected future demand and available supplies, envisaged
additional capacity under planning or construction. The
competent authorities shall publish, by 31 July each year
at the latest a report outlining the findings resulting from
the monitoring of these issues, as well as any measures
taken or envisaged to address them and forward this
report to the Commission forthwith.’

the

cover

the national

Member States or
regulatory authorities
referred to in Article 22(1) shall ensure the monitoring
of security of supply issues. This monitoring shall,
in
supply/demand balance on the
particular,
national market, the level of expected future demand and
available supplies, envisaged additional capacity under
planning or construction, and the quality and level of
maintenance of the networks. The competent authorities
shall publish, by 31 July each year at the latest, a report
outlining the findings resulting from the monitoring of
these issues, as well as any measures taken or envisaged
to address
to the
Commission forthwith.’

them and forward this

report

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3. Articles 5, 6 and 7 are replaced by the following:

Unchanged

‘Article 5

Member States shall ensure that technical rules establishing
operational
the minimum technical
requirements for the connection to the system of LNG
facilities,
or
distribution systems, and direct lines, are developed and
made available.

transmission

facilities,

storage

design

other

and

These technical rules shall ensure the interoperability of
systems and shall be objective and non-discriminatory.
They shall be notified to the Commission in accordance
with Article 8 of Council Directive of (*).

These technical rules shall ensure the interoperability of
systems and shall be objective and non-discriminatory.
They shall be notified to the Commission in accordance
with Article 8 of Council Directive 98/34/EC of 22 June
1998 (*).

Article 6

Unchanged

Member States shall take the measures necessary to ensure
that transmission, storage and LNG act in accordance with
Articles 7 and 8.

Member States shall take the measures necessary to ensure
that transmission, storage and LNG system operators act in
accordance with Articles 7 and 8.

Article 7

Unchanged

1. Member States shall designate or shall require natural
gas undertakings which own transmission, storage or LNG
time to be
facilities
determined
to
considerations of efficiency and economic balance, one
or more system operators.

for a period of
having

to designate,

by Member

regard

States

Each transmission,

2.
operator shall:

storage

and/or LNG system

(a) operate, maintain and develop under

economic
conditions secure, reliable and efficient transmission,
storage and/or LNG facilities, with due regard to the
environment;

(b) refrain from discriminating between system users or
classes of system users, particularly in favour of its
related undertakings;

(c) provide any other transmission system operator, any
other storage system operator, any other LNG system
operator and/or any distribution system operator,
sufficient
the transport
and storage of natural gas may take place in a
manner compatible with the secure and efficient
operation of the interconnected system.

information to ensure that

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Rules for balancing the gas system shall be, transparent
and non-discriminatory,
such
for
services by transmission system operators shall be estab-
lished

the provision of

Rules adopted by transmission system operators
for
balancing the gas system shall be objective, transparent
including rules for the charging
and non-discriminatory,
of system users of their networks for energy imbalance.
Terms and conditions, including rules and tariffs, for the
provision of
transmission system
operators shall be established pursuant to a methodology
compatible with Article 22(2) in a non-discriminatory and
cost-reflective way and shall be published.

such services by

___________
(*) OJ L 204, 21.7.1998, p. 37.’

___________
(*) OJ L 204, 21.7.1998, p. 37.’

4. The following Articles 7a and 7b are inserted:

Unchanged

‘Article 7a

1. Member States may require transmission system
operators for the maintenance and development of the
transmission system, including interconnection capacity.

1. Member States may require transmission system
operators to comply with minimum standards for the
maintenance
transmission
the
development of
system, including interconnection capacity.

and

Unless the transmission system operator is already
2.
fully independent from other activities not relating to the
transmission system in terms of ownership, the system
operator shall be independent at
its
legal form, organisation and decision making from other
activities not relating to transmission.

in terms of

least

Unless the transmission system operator is already
2.
fully independent from other activities not relating to the
transmission system in terms of ownership, the system
operator, within the integrated natural gas undertaking,
shall be independent at least in terms of its legal form,
organisation and decision making from other activities not
relating to transmission.

In order to ensure the independence of the transmission
system operator, the following criteria shall apply:

In order to ensure the independence of the transmission
system operator,
the following minimum criteria shall
apply:

(a) those persons responsible for the management of the
company
transmission may
structures of
the integrated natural gas undertaking
responsible, directly or indirectly, for the day-to-day
operation of the production, distribution and supply
of natural gas;

participate

not

in

(a) those persons responsible for the management of the
transmission system operator may not participate in
company structures of
the integrated natural gas
undertaking responsible, directly or indirectly, for the
the production, distribution
day-to-day operation of
and supply of natural gas;

(b) appropriate measures must be taken to ensure that the
interests of persons responsible for the
professional
management of the transmission system operator are
taken into account in a manner that ensures that they
are capable of acting independently;

Unchanged

(c) the transmission system operator must have effective
decision-making rights,
from the inte-
grated natural gas undertaking, with respect to assets
necessary to maintain or develop the network;

independent

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that discriminatory

(d) the transmission system operator must establish a
compliance programme, which sets out measures
is
taken to ensure
excluded. The programme must set out the specific
obligations of employees to meet
It
must be drawn up and its respect monitored by a
compliance officer. An annual report, setting out the
measures taken, must be submitted by the compliance
officer to the national regulatory authority referred to
in Article 22(1) and published.

this objective.

conduct

Article 7b

Unchanged

Transmission system operators shall procure the energy
they use
functions
according to transparent, non-discriminatory and market
based procedures.’

carrying out of

their

the

for

5. Articles 8 to 11 are replaced by the following:

‘Article 8

1. Without prejudice to Article 12 or any other legal
duty to disclose information, each transmission, storage
and/or
of
information obtained in the
commercially
course of carrying out its business.

confidentiality

LNG shall

sensitive

preserve

the

1. Without prejudice to Article 12 or any other legal
duty to disclose information, each transmission, storage
and/or LNG system operator shall preserve the confiden-
tiality of commercially sensitive information obtained in
the course of carrying out its business, and shall prevent
information about
its own activities which may be
commercially advantageous being disclosed in a discrimi-
natory manner.

Transmission shall not,

2.
in the context of sales or
purchases of natural gas by related undertakings, abuse
commercially sensitive information obtained from third
parties in the context of providing or negotiating access
to the system.

Transmission system operators

2.
in the
context of sales or purchases of natural gas by related
undertakings, abuse commercially sensitive information
obtained from third parties in the context of providing
or negotiating access to the system.

shall not,

Article 9

for a period of

Member States shall designate or shall require undertakings
which own or are responsible for distribution systems to
time to be determined by
designate,
Member States having regard to considerations of effi-
ciency and economic balance, one or more distribution
system operators and shall ensure that those operators
act in accordance with Articles 10 and 11.

Article 10

Unchanged

1.
Each distribution shall operate, maintain and develop
under economic conditions a secure, reliable and efficient
system, with due regard to the environment.

Each distribution system operator

shall operate,
1.
maintain and develop under
economic conditions a
secure, reliable and efficient system, with due regard to
the environment.

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AMENDED PROPOSAL

In any event, the distribution shall not discriminate
system users,

2.
between system users or
particularly in favour of its related undertakings.

classes of

Each distribution shall provide any other distribution,
3.
and/or any transmission, and/or storage with sufficient
information to ensure that the transport of natural gas
takes place in a manner compatible with the secure and
efficient operation of the interconnected system.

from other

Unless the system operator is already fully inde-
4.
pendent
to the
activities not
distribution system in terms of ownership, the distribution
system operator shall be independent at least in terms of
form, organisation and decision making from
its legal
other activities not relating to distribution.

relating

2.
In any event, the distribution system operator shall
not discriminate between system users or classes of system
users, particularly in favour of its related undertakings.

Each distribution system operator shall provide any
3.
other distribution system operator, and/or any trans-
mission, and/or LNG system operator, and/or storage
system operator with sufficient
information to ensure
that the transport and storage of natural gas takes place
in a manner compatible with the secure and efficient
operation of the interconnected system. These rules shall
also apply to biogas and gas from biomass in so far as
such gases can technically and safely be injected into the
natural gas system.

4.
Unless the distribution system operator is already
fully independent from other activities not relating to the
distribution system in terms of ownership, the distribution
system operator within the integrated natural gas under-
taking shall be independent at least in terms of its legal
form, organisation and decision making from other
activities not relating to distribution.

In order to ensure the independence of the distribution
system operator,
the following minimum criteria shall
apply:

Unchanged

(a) those persons responsible for the management of the
distribution system operator may not participate in
company structures of
the integrated natural gas
undertaking responsible, directly or indirectly, for the
day-to-day operation of the production, transmission
and supply of natural gas;

(b) appropriate measures must be taken to ensure that the
professional
interests of persons responsible for the
management of the distribution system operator are
in a manner that ensures that
taken into account
they are capable of acting independently;

(c) the distribution system operator must have effective
decision-making rights,
from the inte-
grated natural gas undertaking, with respect to assets
necessary to maintain or develop the network;

independent

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that discriminatory

(d) the distribution system operator must establish a
compliance programme, which sets out measures
is
taken to ensure
excluded. The programme must set out the specific
obligations of employees to meet
It
must be drawn up and its respect monitored by a
compliance officer. An annual report, setting out the
measures taken, must be submitted by the compliance
officer to the national regulatory authority referred to
in Article 22(1) and published.

this objective.

conduct

This paragraph shall apply from 1 January 2004. Member
States may decide not to apply this paragraph to integrated
natural gas undertakings
than 100 000
customers at that date.

serving less

Unchanged

be

shall

objective,

transparent

5. Where distribution system operators are responsible
for balancing the gas system, rules adopted by them for
and
purpose
that
non-discriminatory,
including rules for the charging of
system users for energy imbalance. Terms and conditions,
for the provision of such
including rules and tariffs,
by
services
established
be
to a methodology compatible with Article
pursuant
22(2) in a non-discriminatory and cost-reflective way and
shall be published.

system operators

shall

Article 11

Unchanged

1. Without prejudice to Article 12 or any other legal
duty to disclose information, each distribution shall
preserve
the confidentiality of commercially sensitive
information obtained in the course of carrying out its
business.

1. Without prejudice to Article 12 or any other legal
duty to disclose information, each distribution system
operator shall preserve the confidentiality of commercially
sensitive information obtained in the course of carrying
out its business, and shall prevent information about its
own activities which may be commercially advantageous
being disclosed in a discriminatory manner.

Distribution shall not,

2.
in the context of sales or
purchases of natural gas by related undertakings, abuse
commercially sensitive information obtained from third
parties in the context of providing or negotiating access
to the system.’

Distribution system operators

2.
in the
context of sales or purchases of natural gas by related
undertakings, abuse commercially sensitive information
obtained from third parties in the context of providing
or negotiating access to the system.’

shall not,

6. The following Article 11a is inserted:

Unchanged

‘Article 11a

The rules in Articles 7a(2) and 10(4) do not prevent the
operation of a combined transmission, and distribution
system operator, which is fully independent in terms of
its legal
form, organisation and decision making from
other activities not relating to transmission distribution.’

The rules in Articles 7a(2) and 10(4) do not prevent the
operation of a combined transmission, LNG, storage and
distribution system operator, which is fully independent in
terms of its legal form, organisation and decision making
from other activities not relating to transmission LNG,
storage and distribution system operations.’

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INITIAL PROPOSAL

AMENDED PROPOSAL

7. Article 12 is replaced by the following:

Unchanged

‘Article 12

Member States or any competent authority they designate,
including the national regulatory authorities referred to in
Article 22(1) and the dispute
settlement authorities
referred to in Article 23(3), shall have right of access to
the accounts of natural gas undertakings as set out in
Article 13 which they need to consult in carrying out
their
and any designated
the dispute settlement authorities,
competent authority,
commercially
of
confidentiality
the
preserve
shall
sensitive
information. Member States may introduce
exceptions to the principle of confidentiality where this
is necessary in order for the competent authorities to
carry out their functions.’

functions. Member States

functions. Member States

Member States or any competent authority they designate,
including the national regulatory authorities referred to in
Article 22(1) and the dispute
settlement authorities
referred to in Article 23(3), shall have right of access to
the accounts of natural gas undertakings as set out in
Article 13 which they need to consult in carrying out
and any designated
their
competent authority,
regulatory
authorities referred to in Article 22(1) and the dispute
settlement authorities, shall preserve the confidentiality of
commercially sensitive information. Member States may
introduce exceptions to the principle of confidentiality
where this is necessary in order for the competent auth-
orities to carry out their functions.’

including the national

8. Article 13 is amended as follows:

Unchanged

(a) Paragraph 1 is replaced by the following:

‘1. Member States shall take the necessary steps to
ensure that the accounts of natural gas undertakings
are kept in accordance with paragraphs 2 to 5 of this
Article.’

‘1. Member States shall take the necessary steps to
ensure that the accounts of natural gas undertakings
are kept in accordance with paragraphs 2 to 5 of this
Article. Where companies benefit from a derogation
from this provision on the basis of Article 26(3),
least keep their internal accounts in
they shall at
accordance with this Article.’

(b) Paragraph 3 is replaced by the following:

Unchanged

Integrated natural gas undertakings shall, in their
‘3.
internal accounting, keep separate accounts for their
transmission, distribution, supply, LNG and storage
activities, as they would be required to do if
the
activities in question were carried out by separate
undertakings, with a view to avoiding discrimination,
cross-subsidisation and distortion of
competition.
they shall keep consolidated
Where
non-gas
accounts
internal
for
include a balance sheet and a profit
accounts shall
and loss account for each activity.’

appropriate,

activities.

These

Integrated natural gas undertakings shall, in their
‘3.
internal accounting, keep separate accounts for their
transmission, distribution, supply, LNG and storage
activities, as they would be required to do if
the
activities in question were carried out by separate
undertakings, with a view to avoiding discrimination,
cross-subsidisation and distortion of competition. They
shall keep separate accounts for supply activities for
eligible customers and supply activities for non-eligible
the trans-
customers. Revenue from ownership of
mission/distribution network shall be specified in the
accounts. Where
keep
appropriate,
consolidated accounts
for non-gas activities. These
internal accounts shall include a balance sheet and a
profit and loss account for each activity.’

shall

they

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AMENDED PROPOSAL

9. Articles 14 and 15 are replaced by the following:

Unchanged

‘Article 14

and

system,

1. Member States shall ensure the implementation of a
third party access to the transmission and
system of
distribution
on
published tariffs, applicable to all eligible customers and
applied objectively and without discrimination between
system users that these tariffs shall be approved prior to
their entry into force by a national regulatory authority
referred to in Article 22(1)

LNG facilities

based

and

based

system,

LNG facilities

third-party access

1. Member States shall ensure the implementation of a
to the transmission and
system of
distribution
on
published tariffs, applicable to all eligible customers and
applied objectively and without discrimination between
system users. Member States
these
tariffs, or the methodologies underlying their calculation
shall be approved prior to their entry into force by a
national regulatory authority referred to in Article 22(1)
and that these tariffs are published prior to their entry into
force.

shall ensure that

Transmission system operators shall, if necessary for
2.
the purpose of carrying out their functions including in
relation to cross-border transmission, have access to the
network of other transmission system operators.

Unchanged

Article 15

For

the organisation of access

1.
to storage and
equivalent flexibility instruments when technically and/or
economically necessary for providing efficient access to the
system for the supply of customers, as well as for the
organisation of access
to ancillary services, Member
States may choose either or both procedures referred to
in paragraphs 2 and 3. These procedures shall operate in
accordance with objective, transparent and non-discrimi-
natory criteria.

2.
In the case of negotiated access, Member States shall
take the necessary measures for natural gas undertakings
and eligible customers either inside or outside the territory
covered by the interconnected system to be able to
negotiate access.

2.
In the case of negotiated access, Member States shall
take the necessary measures for natural gas undertakings
and eligible customers either inside or outside the territory
covered by the interconnected system to be able to
flexibility
negotiate access
instruments, when
economically
technically
necessary for providing efficient access to the system.
The parties
to
storage and equivalent flexibility instruments in good faith.

shall be obliged to negotiate access

to storage and equivalent

and/or

Contracts for access shall be negotiated with the relevant
system operator or natural gas undertakings. Member
States
to
publish their main commercial conditions

require and natural gas undertakings

shall

Contracts for access to storage and equivalent flexibility
instruments shall be negotiated with the relevant storage
system operator or natural gas undertakings. Member
States shall require storage system operators and natural
gas undertakings
to publish their main commercial
conditions for the use of storage and equivalent flexibility
instruments within the first year following implementation
of
this Directive and on an annual basis every year
thereafter.

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INITIAL PROPOSAL

AMENDED PROPOSAL

the

3. Member States opting for a procedure of regulated
access shall take the necessary measures to give natural gas
inside or
undertakings and eligible customers either
outside
interconnected
territory covered by the
system a right on the basis of published tariffs and/or
other terms and obligations for use of This right of
access for eligible customers may be given by enabling
into supply contracts with competing
them to enter
natural gas undertakings other than the owner and/or
operator of the system or a related undertaking.’

the

customers either

3. Member States opting for a procedure of regulated
access shall take the necessary measures to give natural gas
inside or
undertakings and eligible
outside
interconnected
territory covered by the
system a right to access to storage and equivalent flexi-
bility instruments, on the basis of published tariffs and/or
other terms and obligations for use of that storage and
equivalent flexibility instruments, when technically and/or
economically necessary for providing efficient access to the
system. This right of access for eligible customers may be
given by enabling them to enter into supply contracts with
competing natural gas undertakings other than the owner
and/or operator of the system or a related undertaking.’

10. Article 16 is deleted.

Unchanged

11. Articles 18, 19 and 20 are replaced by the following:

‘Article 18

The eligible customers are the customers which are free to
purchase gas from the supply undertaking of their choice
within the Community. Member States shall ensure that
these eligible customers are:

(a) until 1 January 2004,

the eligible customers as
specified
in Article 18 of Directive 98/30/EC.
Member States shall publish by 31 January each year
the
eligible
customers;

the definition of

criteria

these

for

(b) from 1 January 2004 at the latest, all non-household

customers;

(c) from 1 January 2005, all customers.

Article 19

Unchanged

To avoid imbalance in the opening of gas markets:

(a) contracts for the supply with an eligible customer in
the system of another Member State shall not be
prohibited if the customer is eligible in both systems
involved;

(b) in cases where transactions as described in point (a) are
refused because the customer is eligible in only one of
the two systems, the Commission may oblige, taking
into account
the situation in the market and the
common interest, the refusing party to execute the
requested supply, at the request of the Member State
where the eligible customer is located.

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INITIAL PROPOSAL

AMENDED PROPOSAL

Article 20

1. Member States shall take the necessary measures to
enable:

(a) natural gas undertakings

established within their
territory to supply the eligible customers through a
direct line

(a) natural gas undertakings

established within their
territory to supply the eligible customers through a
direct line;

(b) any such eligible customer within their territory to be
supplied through a direct line by natural gas under-
takings.

Unchanged

In circumstances where an authorisation (e.g. licence,
2.
permission, concession, consent or approval) is required
the
for the construction or operation of direct
Member
they
designate shall lay down the criteria for the grant of auth-
orisations for the construction or operation of such lines
in their territory. These criteria shall be objective, trans-
parent and non-discriminatory.

competent

authority

States

lines,

any

or

3. Member States may make authorisations to construct
a direct line subject either to the refusal of system access
on the basis of Article 17 or to the opening of a dispute
settlement procedure under Article.’

3. Member States may make authorisations to construct
a direct line subject either to the refusal of system access
on the basis of Article 17 or to the opening of a dispute
settlement procedure under Article 22.’

12. Article 21 is deleted.

Unchanged

13. Article 22 is replaced by the following:

‘Article 22

States

designate one or more
shall
1. Member
regulatory authorities.
competent bodies
as national
the
These authorities shall be wholly independent of
least be
interests of
to
responsible for continuously monitoring the market
ensure non-discrimination, effective competition and the
efficient
in particular with
respect to:

industry. They shall at

functioning of

the market,

the gas

(a) the level of competition;

(b) the rules on the management and allocation of inter-
connection capacity, in conjunction with the national
regulatory authority or authorities of those Member
States with which interconnection exists;

(c) any mechanisms

to deal with congested capacity

within the national gas system;

(d) the time taken by transmission and distribution system

operators to make connections and repairs;

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INITIAL PROPOSAL

AMENDED PROPOSAL

(e) the publication of appropriate information by trans-
mission and distribution system operators concerning
interconnectors, grid usage and capacity allocation to
interested parties, taking into account the need to treat
non-aggregated information as commercially confi-
dential;

(f)

the effective unbundling of accounts as referred to in
Article 13,
to ensure there are no cross-subsidies
between transmission, distribution, storage, LNG and
supply activities;

(g) the access conditions to storage and equivalent flexi-
in Article 15,

bility instruments, as provided for
paragraphs 2 and 3.

2.
The national regulatory authorities shall at least be
responsible for fixing or approving prior to their entry
into force,
the methodologies used to calculate or
establish the terms and conditions for:

(a) connection and access to national networks, including
terms,

transmission and
conditions and tariffs for access to LNG facilities;

distribution tariffs

and

(b) the provision of balancing services.

National

regulatory

authorities

the
3.
authority to require transmission, LNG and distribution
system operators,
if necessary, to modify the terms and
including tariffs and methodologies referred
conditions,
to in paragraph 2,
they are reasonable
and applied in a non-discriminatory manner.

to ensure that

shall have

Any party having a complaint against a transmission,
4.
LNG or distribution system operator with respect to the
issues mentioned in paragraphs 1, 2 and 3 and in Article
15 may refer the complaint to the national regulatory
authority which, acting as dispute settlement authority,
shall issue a decision within two months after receipt of
the complaint. This period may be extended by two
months where additional
information is sought by the
national
regulatory authorities. This period may be
extended further with the agreement of the complainant.
Any appeal against
such a decision shall not have
suspensive effect.

1. Member States shall take measures to ensure that
national regulatory authorities are able to carry out their
duties referred to in paragraphs 1 to 4 in an efficient and
expeditious manner.

5. Member States shall take measures to ensure that
national regulatory authorities are able to carry out their
duties referred to in paragraphs 1 to 4 in an efficient and
expeditious manner.

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AMENDED PROPOSAL

2. Member States shall create appropriate and efficient
mechanisms for regulation, control and transparency so as
to avoid any abuse of dominant position, in particular to
the detriment of consumers, and any predatory behaviour.
These mechanisms shall take account of the provisions of
the Treaty, and in particular Article 82 thereof.

6. Member States shall create appropriate and efficient
mechanisms for regulation, control and transparency so as
to avoid any abuse of dominant position, in particular to
the detriment of consumers, and any predatory behaviour.
These mechanisms shall take account of the provisions of
the Treaty, and in particular Article 82 thereof.

the appropriate
3. Member States shall ensure that
measures are taken,
including administrative action or
criminal proceedings in conformity with their national
law, against
responsible
imposed by this Directive
where confidentiality rules
have not been respected.’

the natural or

legal persons

the appropriate
7. Member States shall ensure that
measures are taken,
including administrative action or
criminal proceedings in conformity with their national
law, against
responsible
imposed by this Directive
where confidentiality rules
have not been respected.

the natural or

legal persons

In the event of cross-border disputes, the national
8.
regulatory authority shall be the national
regulatory
authority covering the system operator, which refuses
use of, or access to, the system.

9.
Recourse to the national regulatory authority shall be
without prejudice to the exercise of rights of appeal under
Community law.’

14. In Article 23, paragraph 1 is replaced by the following:

Unchanged

‘1. Member States shall take the necessary measures to
ensure that natural gas undertakings and customers,
wherever they are located, are able to obtain access to
upstream pipeline networks, including facilities supplying
technical services incidental to such access, in accordance
with this Article, except for the parts of such networks and
facilities which are used for local production operations at
the site of a field where the gas is produced. The measures
shall be notified to the Commission in accordance with the
provisions of Article 29.’

gas

and

undertakings

that natural

‘1. Member States shall take the necessary measures to
ensure
eligible
customers, wherever they are located, are able to obtain
access to upstream pipeline networks, including facilities
supplying technical services incidental to such access, in
accordance with this Article, except for the parts of such
networks and facilities which are used for local production
operations at the site of a field where the gas is produced.
The measures shall be notified to the Commission in
accordance with the provisions of Article 29.’

15. In Article 25, paragraphs 1 and 2 are replaced by the

Unchanged

following:

competent

take-or-pay

serious
its

authority. Applications

If a natural gas undertaking encounters, or considers
‘1.
economic and financial
it would encounter,
difficulties because of
commitments
accepted in one or more gas-purchase contracts, an
application for a temporary derogation from Article 15
to the Member State concerned or the
may be sent
designated
shall,
according to the choice of Member States, be presented
on a case-by-case basis either before or after refusal of
access to the system. Member States may also give the
natural gas undertaking
an
the
application either before or after refusal of access to the
system. Where a natural gas undertaking has refused
access, the application shall be presented without delay.
The applications shall be accompanied by all relevant
information on the nature and extent of
the problem
and on the efforts undertaken by the natural gas under-
taking to solve the problem.

to present

choice

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INITIAL PROPOSAL

AMENDED PROPOSAL

If alternative solutions are not reasonably available, and
taking into account the provisions of paragraph 3, the
Member State or
the designated competent authority
may decide to grant a derogation.

The Member State, or

2.
the designated competent
authority, shall notify the Commission without delay of
its decision to grant a derogation, together with all the
relevant information with respect to the derogation. This
information may be submitted to the Commission in an
aggregated form, enabling the Commission to reach a well-
founded decision. Within four weeks of its receipt of this
notification, the Commission may request that the Member
State or the designated competent authority concerned
amend or withdraw the decision to grant a derogation.

If the Member State or the designated competent authority
concerned does not comply with this request within a
period of
four weeks, a final decision shall be taken
expeditiously in accordance with the advisory procedure
of Article 3 of Council Decision (*).

If the Member State or the designated competent authority
concerned does not comply with this request within a
period of
four weeks, a final decision shall be taken
expeditiously in accordance with the advisory procedure
of Article 3 of Council Decision 1999/468/EC (*).

The Commission shall preserve the confidentiality of
commercially sensitive information.

Unchanged

___________
(*) OJ L 184, 17.7.1999, p. 23.’

___________
(*) OJ L 184, 17.7.1999, p. 23.’

16. In Article 26, paragraphs 1, 2 and 3 are replaced by the

Unchanged

following:

‘1. Member States not directly connected to the inter-
connected system of any other Member State and having
only one main external supplier may derogate from Article
4, of this Directive. A having a market share of more than
75 % shall be considered to be a main supplier. This dero-
gation shall automatically expire from the moment when
at least one of these conditions no longer applies. Any
such derogation shall be notified to the Commission.

‘1. Member States not directly connected to the inter-
connected system of any other Member State and having
only one main external supplier may derogate from Article
4, Article 18 and/or Article 20 of this Directive. A supply
undertaking having a market share of more than 75 %
shall be considered to be a main supplier. This derogation
shall automatically expire from the moment when at least
one of these conditions no longer applies. Any such dero-
gation shall be notified to the Commission.

2.
A Member State, qualifying as an emergent market,
which because of the implementation of this Directive
would experience substantial problems, not associated
with the contractual take-or-pay commitments referred to
in Article 25, may derogate from Article 4, of
this
Directive. This derogation shall automatically expire from
the moment when the Member State no longer qualifies as
an emergent market. Any such derogation shall be notified
to the Commission.

2.
A Member State, qualifying as an emergent market,
which because of the implementation of this Directive
would experience substantial problems, not associated
with the contractual take-or-pay commitments referred to
in Article 25, may derogate from Article 4, Article 18
and/or Article 20 of this Directive. This derogation shall
automatically expire from the moment when the Member
State no longer qualifies as an emergent market. Any such
derogation shall be notified to the Commission.

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AMENDED PROPOSAL

3. Where implementation of this Directive would cause
substantial problems in a geographically limited area of a
Member State, in particular concerning the development of
the transmission infrastructure, and with a view to
encouraging investments,
the Member State may apply
to the Commission for a temporary derogation from for
developments within this area.’

3. Where implementation of this Directive would cause
substantial problems in a geographically limited area of a
Member State, in particular concerning the development of
the transmission infrastructure, and with a view to
encouraging investments,
the Member State may apply
to the Commission for a temporary derogation from
Article 4, Article 7(1), 7(3), 7a(2), Article 9(1), Article
10(4), 10(5), Article 13, Article 14(1), Article 18 and/or
Article 20 for developments within this area.’

17. Article 27 is deleted.

Unchanged

18. Article 28 is replaced by the following:

‘Article 28

shall monitor

The Commission

review the
1.
application of this Directive and submit an overall progress
report
to the European Parliament and the Council before
the end of the first year following the entry into force of
this Directive, and thereafter on an annual basis. The report
shall at least cover:

and

(a) the experience gained and progress made in creating a
complete and fully operational internal market in natural
gas and the obstacles that remain in this respect including
aspects of market dominance, concentration in the market,
predatory or anti-competitive behaviour;

(b) the extent

to which the unbundling and tarification
contained in this Directive have been
requirements
successful
in ensuring fair and non-discriminatory access
to the Community's gas system and equivalent levels of
competition, as well as the economic, environmental and
social consequences of the opening of the gas market for
customers;

(c) an examination of issues relating to system capacity levels
and security of supply of natural gas in the Community,
the existing and projected balance
and in particular
between demand and supply,
the
physical capacity for exchanges between areas;

taking into account

(d) a general assessment of the progress achieved with regard
to bilateral relations with third countries which produce
and export or transport natural gas, including progress in
market integration, trade and access to the networks of
such third countries;

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AMENDED PROPOSAL

(e) the need for possible harmonisation requirements which

are not linked to the provisions of this Directive.

Where appropriate, this report may include recommendations.

2.
Every two years, the report referred to in paragraph 1
shall also cover an analysis of the different measures taken in
Member States to meet public service obligations, together with
an examination of the effectiveness of those measures, and in
particular their effects on competition in the gas market.
Where appropriate, the report may include recommendations
as to the measures to be taken at national level to achieve high
public service standards or measures intended to prevent
market foreclosure.’

19. The Annex, the text of which is set out in Annex II to this

Unchanged

Directive, is added.

Article 3

Directives 90/547/EEC and 91/296/EEC are repealed with
effect from 1 January 2003.

Article 4

Member States shall bring into force the laws, regulations and
administrative provisions necessary to comply with this
forthwith inform the
Directive at
Commission thereof.

the latest. They shall

Member States shall bring into force the laws, regulations and
administrative provisions necessary to comply with this
Directive [at . . .] at the latest. They shall forthwith inform
the Commission thereof.

When Member States adopt those provisions, they shall contain
a reference to this Directive or be accompanied by such a
reference on the occasion of
their official publication.
Member States shall determine how such reference is to be
made.

Unchanged

Article 5

This Directive shall enter into force on the twentieth day
following that of its publication in the Official Journal of the
European Communities.

Article 6

This Directive is addressed to the Member States.

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INITIAL PROPOSAL

AMENDED PROPOSAL

ANNEX I

‘ANNEX

(Article 3)

Unchanged

Without prejudice to Community rules on consumer protection,
in
particular Directive 97/7/EC of the European Parliament and of the
Council (1) and Council Directive 93/13/EC (2), the measures referred
to in Article 3 are:

Member States shall ensure that final customers:

(a) Have a right to a contract with their electricity service provider that

specifies:

— the identity and address of the supplier;

— services provided, the service quality levels offered, as well as

the time for the initial connection;

— the types of maintenance service offered;

— the means by which up-to-date information on all applicable

tariffs and maintenance charges may be obtained;

— the duration of the contract, the conditions for renewal and
termination of services and of the contract, the existence of
any right of withdrawal;

— any compensation and the refund arrangements which apply if

contracted service quality levels are not met; and

— the method of initiating procedures for settlement of disputes in

accordance with point (e).

Conditions shall be fair and well-known in advance. In any case,
this information should be provided prior to the conclusion of the
contract. Where contracts are concluded through intermediaries,
the above information shall also be provided prior
to the
conclusion of the contract.

(b) Are given adequate notice of any intention to modify contractual
conditions. Final customers shall be informed about their right of
withdrawal when the notice is given. Service providers shall notify
their subscribers directly of any increase in charges, at an appro-
priate time no later than one normal billing period after the
increase comes
shall ensure that
into effect. Member States
household customers are free to withdraw from contracts if they
do not accept the new conditions, notified to them by their elec-
tricity service provider.

Unchanged

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INITIAL PROPOSAL

AMENDED PROPOSAL

(c) Receive transparent information on applicable prices and tariffs and
on standard terms and conditions, in respect of access to and use of
electricity services.

(d) Are offered a full choice of payment methods, free of charge.
General terms and conditions shall be fair and transparent. They
shall be given in clear and comprehensible language. Final
customers shall be protected against unfair or misleading selling
methods.

(d) Benefit from transparent, simple and inexpensive procedures for
shall enable
dealing with their complaints. Such procedures
disputes to be settled fairly and promptly with provision, where
warranted, for a system of reimbursement and/or compensation.
They should follow, wherever possible, the principles set out in
Commission Recommendation 98/257/EC (3).

(e) Benefit from transparent, simple and inexpensive procedures for
shall enable
dealing with their complaints. Such procedures
disputes to be settled fairly and promptly with provision, where
warranted, for a system of reimbursement and/or compensation.
They should follow, wherever possible, the principles set out in
Commission Recommendation 98/257/EC (3).

(f) Are informed about their rights regarding universal service.

___________
(1) OJ L 144, 4.6.1997, p. 19.
(2) OJ L 95, 21.4.1993, p. 29.
(3) OJ L 115, 17.4.1998, p. 31.’

___________
(3) OJ L 115, 17.4.1998, p. 31.’

ANNEX II

‘ANNEX

in
Without prejudice to Community rules on consumer protection,
particular Directive 97/7/EC of the European Parliament and of the
Council (1) and Council Directive 93/13/EC (2), the measures referred
to in Article 3 are:

Unchanged

Member States shall ensure that final customers:

(a) Have a right to a contract with their gas service provider that

specifies:

— the identity and address of the supplier;

— services provided, the service quality levels offered, as well as

the time for the initial connection;

— the types of maintenance service offered;

— the means by which up-to-date information on all applicable

tariffs and maintenance charges may be obtained;

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INITIAL PROPOSAL

AMENDED PROPOSAL

— the duration of the contract, the conditions for renewal and
termination of services and of the contract, the existence of
any right of withdrawal;

— any compensation and the refund arrangements which apply if

contracted service quality levels are not met; and

— the method of initiating procedures for settlement of disputes in

accordance with point (e).

(b) Aregiven adequate notice of any intention to modify contractual
conditions. Member States shall ensure that final customers are free
to withdraw from contracts if
the new
conditions, notified to them by their gas service provider.

they do not accept

Conditions shall be fair and well-known in advance. In any case,
this information should be provided prior to the conclusion of the
contract. Where contracts are concluded through intermediaries,
the above information shall also be provided prior
to the
conclusion of the contract.

(b) Are given adequate notice of any intention to modify contractual
conditions. Customers shall be informed about their right of with-
drawal when the notice is given. Service providers shall notify their
subscribers directly of any increase in charges, at an appropriate
time no later than one normal billing period after the increase
final
comes
customers are free to withdraw from contracts if they do not
accept the new conditions, notified to them by their gas service
provider.

into effect. Member

ensure

States

shall

that

(c) Receive transparent information on applicable prices and tariffs and
on standard terms and conditions, in respect of access to and use of
gas services.

Unchanged

(d) Are offered

(d) Are offered a full choice of payment methods free of charge.
General terms and conditions shall be fair and transparent. They
shall be given in clear and comprehensible language. Final
customers shall be protected against unfair or misleading selling
methods.

(e) benefit from transparent, simple and inexpensive procedures are
made available for dealing with their complaints. Such procedures
shall enable disputes to be settled fairly and promptly with
provision, where warranted,
reimbursement
and/or compensation. They should follow, wherever possible, the
principles set out in Commission Recommendation 98/257/EC (3).

for a system of

(e) Benefit from transparent, simple and inexpensive procedures are
made available for dealing with their complaints. Such procedures
shall enable disputes to be settled fairly and promptly with
provision, where warranted,
reimbursement
and/or compensation. They should follow, wherever possible, the
principles set out in Commission Recommendation 98/257/EC (3).

for a system of

___________
(1) OJ L 144, 4.6.1997, p. 19.
(2) OJ L 95, 21.4.1993, p. 29.
(3) OJ L 115, 17.4.1998, p. 31.’

(f) Connected to the gas system are informed about their rights to be
supplied with natural gas of a specified quality at reasonable prices.

___________
(3) OJ L 115, 17.4.1998, p. 31.’