Proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Directive 2009/73/EC concerning common rules for the internal market in natural gas
Date: 2017-11-08
Institutions: Directorate-General for Energy, European Commission
Subjects: energy grid, gas pipeline, gas supply, import (EU), natural gas, security of supply, single market, third country

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   EUROPEAN COMMISSION  Brussels, 8.11.2017  COM(2017) 660 final 2017/0294 (COD)  Proposal for a DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Directive 2009/73/EC concerning common rules for the internal market in natural gas  (Text with EEA relevance) {SWD(2017) 368 final}  
 
EXPLANATORY MEMORANDUM 

1. 

• 

CONTEXT OF THE PROPOSAL 

Reasons for and objectives of the proposal 

The  creation  of  an  integrated  gas  market  is  a  cornerstone  of  the  EU's  project  to  create  an 
Energy  Union.  The  internal  gas  market  is  considered  to  function  well  when  gas  can  flow 
freely between Member States to where it is needed most  and at a fair  price. A functioning 
gas  market is  a prerequisite  for enhancing security  of gas  supply  in  the Union. Since gas  is 
transported mainly  through  pipelines,  the  interconnection  of  gas  networks  between  Member 
States and non-discriminatory access to these networks are the basis for the market to function 
efficiently.  It  is  also  a  prerequisite  for  gas  deliveries  during  emergencies,  both  between 
Member States and with neighbouring third countries. The EU is to large extent dependent on 
gas imports from third countries and it is in the best interest of the EU and gas customers to 
have as much transparency and competitiveness also on pipelines from those countries.  

While EU law in general applies in the territorial waters and the exclusive economic zone of 
EU Member States, Directive 2009/73/EC1 (hereafter "the Gas Directive") does not explicitly 
set out a legal framework for gas pipelines to and from third countries. As a result, following 
legal  analysis,  it  has  been  concluded  that  the  rules  applicable  to  gas  transmission  pipelines 
connecting  two  or  more  Member  States,  which  fall  within  the  scope  of  the  definition  of 
"interconnector", are not applicable to such  pipelines entering the EU. However,  there is an 
practice of applying core principles of the regulatory framework set out by the Gas Directive 
in  relation  to  third  countries,  notably  via  international  agreements  concerning  gas  pipelines 
entering the European Union. It is considered that legislative action is henceforth required in 
order  to  define  and  specify  in  an  explicit  and  coherent  manner  the  regulatory  framework 
applicable to all gas pipelines to and from third countries.  

With the proposed amendments, the Gas Directive in its entirety (as well as the related legal 
acts  like  the  Gas  Regulation,  network  codes  and  guidelines,  unless  otherwise  provided  in 
those acts) will become applicable to pipelines to and from third countries, including existing 
and  future  pipelines,  up  to  the  border  of  EU  jurisdiction.  This  includes  the  respective 
provisions on third-party access, tariff regulation, ownership unbundling and transparency. It 
will also enable new pipelines to and from third countries to apply for an exemption from the 
above  rules  pursuant  to  Article  36  Gas  Directive.  As  regards  existing  pipelines,  which  fall 
outside the scope of Article 36, Member States will be enabled to grant derogations from the 
application of the main provisions of the Directive, provided that the derogation would not be 
detrimental  to  competition,  effective  market  functioning  or  the  security  of  supply  in  the 
Union. 

Pipelines to and from third countries would thus be subject to at least two different regulatory 
frameworks.  Where this results in legally complex situations, the appropriate instrument for 
ensuring a coherent regulatory framework for the entire pipeline will often be an international 
agreement  with  the  third  country  or  third  countries  concerned.  In  the  absence  of  such  an 
agreement,  an  exemption  for  new  infrastructure  or  derogation  for  infrastructure  already  in 
operation,  the  pipeline  may  only  be  operated  in  line  with  the  requirements  of  Directive 
2009/73/EC within the borders of EU jurisdiction.  

1 

Directive  2009/73/EC  of  the  European  Parliament  and  of  the  Council  of  13  July  2009  concerning 
common rules for the internal market in natural gas and repealing Directive 2003/55/EC, OJ L 211 of 
14 August 2009, p.94. 

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• 

Consistency with existing policy provisions in the policy area 

The proposal renders the rules currently applicable to EU-internal pipelines also applicable to 
pipelines to and from third countries. As such, it is consistent with existing provisions in the 
policy  area.  Additional  clarifications  are  included  where  necessary  to  take  account  of  the 
specific requirements in relation to third countries. 

• 

Consistency with other Union policies 

The  proposal  seeks  to  implement  key  objectives  of  the  Energy  Union,  as  defined  in  the 
Framework  Strategy  for  a  resilient  Energy  Union  with  a  forward-looking  climate  change 
policy,  especially  in  the  dimension  of  energy  security  (whereas  one  of  the  key  drivers  of 
energy security is the completion of the internal energy market).   

2. 

• 

LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY 

Legal basis 

The legal basis for the proposed measure is Article 194 of the Treaty on the Functioning of 
the European Union (TFEU), which consolidated and clarified the competences of the EU in 
the field of energy. According to Article 194 TFEU, the main aims of the EU’s energy policy 
are  to:  ensure the functioning  of the energy market;  ensure security of energy supply  in  the 
Union;  promote  energy  efficiency  and  energy  savings  and  the  development  of  new  and 
renewable forms of energy; and promote the interconnection of energy networks.  

The present proposal also builds upon a comprehensive set of legislative acts that have been 
adopted and updated during the past two decades. With the objective of creating an internal 
energy market, the EU has adopted three consecutive legislative packages between 1996 and 
2009,  with  the  overarching  aim  of  integrating  markets  and  liberalising  national  gas  and 
electricity  markets.  In  this  connection,  the  present  proposal  would  ensure  that  there  is  no 
discrimination  between  the  operators  of  gas  pipelines  to  and  from  the  EU  and  other  market 
participants to whom the Gas Directive fully applies, for instance operators of gas pipelines 
connecting  different  Member  States  or  operators  of  transmission  systems  within  Member 
States. 

The current proposal should also be seen as part of an ongoing effort to ensure the integration 
and effective operation of Europe’s gas markets.   

• 

Subsidiarity (for non-exclusive competence)  

The  proposed  changes  to  the  Gas  Directive  are  necessary  to  achieve  the  purpose  of  an 
integrated EU gas market and cannot be reached at national level, on the basis of fragmented 
national  rules,  in  an  equally  efficient  manner.  Evidence  has  shown  that  isolated  national 
approaches  have  led  to  delays  in  the  implementation  of  the  internal  energy  market  rules, 
leading  to  sub-optimal  and  incompatible  regulatory  measures,  unnecessary  duplication  of 
interventions  and  delays  in  correcting  market  inefficiencies2.  Furthermore,  pipelines  to  and 
from third countries are in most cases of a capacity which is capable of impacting the internal 
gas market and security of supply in several Member States. 

2 

As set out in detail in the evaluation of the recast legislative acts under the Electricity Market Design 
Initiative (Commission Proposals COM(2016)864 final). 

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Proportionality 

The  proposed  amendment  is  strictly  oriented  on  what  is  indispensable  to  achieve  the 
necessary  progress  for  the  internal  market,  while  leaving  appropriate  competences  and 
responsibilities  for  Member  States,  national  regulators  and  national  actors.  It  includes  the 
possibility for derogations for existing infrastructure (i.e. pipelines to and from third countries 
which are completed before the entry into force of this Directive), to take account of complex 
legal structures already in place which may require a case-specific approach, provided that the 
derogation  would  not  be  detrimental  to  competition,  effective  market  functioning  or  the 
security of supply in the Union. 

• 

Choice of the instrument 

The  proposal  amends  the  Gas  Directive,  a  key  element  of  the  Third  Energy  Package.  The 
choice of an amending Act reflects the limited character of the current proposal.  

3. 

• 

RESULTS 
CONSULTATIONS AND IMPACT ASSESSMENTS 

EX-POST 

EVALUATIONS, 

OF 

STAKEHOLDER 

Ex-post evaluations/fitness checks of existing legislation 

The  content  of  the  current  proposal  is  limited  to  providing  clarification  in  an  area  where 
applicable EU law (or the lack thereof) and applied practice diverge. The proposal builds on 
established practice. To take account of nevertheless existing situations created as a result of 
lack of explicit rules under the current framework, Member States are enabled to provide for 
derogations for existing operating infrastructure. In view of the above, it is considered that the 
amendment of the Gas Directive can be carried out without a separate evaluation process.  

• 

Impact assessment 

The present initiative does not require a detailed impact assessment as the changes proposed 
reflect the practice of applying core principles of the regulatory framework set out in the Gas 
Directive  in  relation  to  third  countries.  This  is  particularly  evidenced  by  the  fact  that  these 
principles are reflected in several international agreements between Member States and third 
countries  or  the  EU  and  third  countries  and  that  they  are  consistently  applied  to  onshore 
pipelines to and from third countries.  

• 

Regulatory fitness and simplification 

The  proposal  may  increase  administrative  requirements,  however  only  to  a  very  limited 
extent.  As  through  the  amendments  the  Gas  Directive  will,  within  the  EU's  jurisdiction,  be 
applicable  in  its  entirety  to  pipelines  to  and  from  third  countries,  it  will  also  enable  new 
pipelines  to  and  from  third  countries  to  apply  for  an  exemption  for  new  infrastructure 
pursuant  to  Article  36  Gas  Directive.  Therefore,  the  number  of  exemption  requests  might 
increase  which  implies  requirements  for  engagement  at  administrative  level  on  the  part  of 
national regulatory authorities and the Commission in taking additional exemption decisions. 
However,  this  is  not  a  new  burden,  but  is  already  a  core  task  defined  in  the  Third  Energy 
Package (Article 36 Gas Directive).  

4. 

BUDGETARY IMPLICATIONS 

No budgetary implications are expected from the proposed amendments of the Gas Directive.  

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5. 

• 

OTHER ELEMENTS 

Implementation plans and monitoring, evaluation and reporting arrangements 

The  Commission  will  monitor  the  transposition  and  compliance  of  the  Member  States  and 
other  actors  with  the  measure  that  shall  be  ultimately  adopted,  and  shall  take  enforcement 
measures if and when required. Existing national regulatory authorities and other competent 
national authorities will ensure implementation of the proposal at a national level. 

• 

Detailed explanation of the specific provisions of the proposal 

The  current  proposal  specifies  the  exact  scope  of  application  of  the  Gas  Directive  and 
consequently the Gas Regulation3 to pipelines to and from third countries up to the border of 
EU  jurisdiction.  This  includes  the  respective  provisions  on  third-party  access,  tariff 
regulation, ownership unbundling and transparency. It will enable new pipelines to and from 
third countries to apply for an exemption pursuant to Article 36 Gas Directive. It also includes 
the  possibility  for  Member  States  to  grant  derogations  for  existing  import  infrastructure 
already  in  operation.  In  order  to  ensure  a  coherent  legal  framework  for  pipelines  passing 
through more than one Member State, it is necessary to establish which Member State should 
decide on such a derogation. 

3 

Which Article 3(2) cross-refers to the definition in Article 2 of the Gas Directive  

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2017/0294 (COD) 

Proposal for a 

DIRECTIVE OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

amending Directive 2009/73/EC concerning common rules for the internal market in 
natural gas 

 (Text with EEA relevance) 

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 194 (2) thereof, 

Having regard to the proposal from the European Commission, 

After transmission of the draft legislative act to the national parliaments, 
Having regard to the opinion of the European Economic and Social Committee4,  
Having regard to the opinion of the Committee of the Regions5, 

Acting in accordance with the ordinary legislative procedure, 

Whereas: 

(1) 

(2) 

(3) 

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The  internal  market  in  natural  gas,  which  has  been  progressively  implemented 
throughout the Union since 1999, aims to deliver real choice for all consumers in the 
Union, be they citizens or businesses, new business opportunities, competitive prices, 
efficient  investment  signals  and  a  higher  standard  of  service,  and  to  contribute  to 
security of supply and sustainability.  
Directive  2003/55/EC  of  the  European  Parliament  and  of  the  Council6  and  Directive 
2009/73/EC of the European Parliament and of the Council7 have made a significant 
contribution towards the creation of the internal market in natural gas.  

This  Directive  seeks  to  address  the  remaining  obstacles  to  the  completion  of  the 
internal market in natural gas resulting from the non-application of Union market rules 
to  gas  pipelines  to  and  from  third  countries.  The  amendments  introduced  by  this 
Directive will ensure that the rules applicable to gas transmission pipelines connecting 
two  or  more  Member  States,  are  also  applicable  to  pipelines  to  and  from  third 
countries  within  the  Union.  This  will  establish  consistency  of  the  legal  framework 
within  the  Union  while  avoiding  distortion  of  competition  in  the  internal  energy 
market in the Union. It will also enhance transparency and provide legal certainty as 

OJ C , , p. . 
OJ C , , p. . 
Directive  2003/55/EC  of  the  European  Parliament  and  of  the  Council  of  26  June  2003  concerning 
common rules for the internal market in natural gas (OJ L 176, 15.7.2003, p. 57). 
Directive  2009/73/EC  of  the  European  Parliament  and  of  the  Council  of  13  July  2009  concerning 
common  rules  for  the  internal  market  in  natural  gas  and  repealing  Directive  2003/55/EC  (OJ  L  211, 
14.8.2009, p. 94). 

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(4) 

(5) 

regards the applicable legal regime to market participants, in particular investors in gas 
infrastructure and network users. 

To take account of the previous lack of specific Union rules applicable to gas pipelines 
to and from third countries, Member States should be able to grant derogations from 
certain provisions of Directive 2009/73/EC to such pipelines which are completed at 
the date of entry into force of this Directive. The relevant date for the application of 
unbundling  models  other  than  ownership  unbundling  should  be  adapted  for  gas 
pipelines to and from third countries. 

The applicability of Directive 2009/73/EC for gas pipelines to and from third countries 
remains  confined  to  the  territorial  limit  of  Union's  jurisdiction.  As  regards  offshore 
pipelines,  it  should  be  applicable  in  the  territorial  waters  and  exclusive  economic 
zones of the Member States.  

(6) 

Directive 2009/73/EC should therefore be amended accordingly,  

HAVE ADOPTED THIS DIRECTIVE: 

Directive 2009/73/EC is amended as follows: 

(1) 

in Article 2, point (17) is replaced by the following: 

Article 1 

"(17)  ‘interconnector’  means  a  transmission  line  which  crosses  or  spans  a  border  between 
Member  States  or  between  Member  States  and  third  countries  up  to  the  border  of  Union 
jurisdiction;" 

(2) 

Article 9 is amended as follows: 

(a) in paragraph 8, the first subparagraph is replaced by the following: 

"8. A Member State may decide not to apply paragraph 1: 

(a)  where  the  transmission  system  belonged  to  a  vertically  integrated  undertaking  on  3 
September 2009; 

(b)  as  regards  infrastructure  to  and  from  third  countries  between  the  border  of  Union 
jurisdiction  and  the  first  interconnection  point  with  the  Union  network,  where  the 
transmission system belonged to a vertically integrated undertaking on [PO: date of adoption 
of this proposal]"; 

(b) paragraph 9 is replaced by the following: 

"9.  Where  there  are  arrangements  in  place  which  guarantee  more  effective independence  of 
the  transmission  system  operator  than  the  provisions  of  Chapter  IV,  a  Member  State  may 
decide not to apply paragraph 1: 

(a)  where  the  transmission  system  belonged  to  a  vertically  integrated  undertaking  on  3 
September 2009; 

(b)  as  regards  infrastructure  to  and  from  third  countries  between  the  border  of  Union 
jurisdiction  and  the  first  interconnection  point  with  the  Union  network,  where  the 
transmission system belonged to a vertically integrated undertaking on [PO: date of adoption 
of this proposal]."; 

(3) in Article 14, paragraph 1 is replaced by the following: 

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"1. Member States may decide not to apply Article 9(1) and designate an independent system 
operator upon a proposal from the transmission system owner: 

(a)  where  the  transmission  system  belonged  to  a  vertically  integrated  undertaking  on  3 
September 2009; 

(b)  as  regards  infrastructure  to  and  from  third  countries  between  the  border  of  Union 
jurisdiction  and  the  first  interconnection  point  with  the  Union  network,  where  the 
transmission system belonged to a vertically integrated undertaking on [PO: date of adoption 
of this proposal]. 

Such designation shall be subject to approval by the Commission."; 

(3) 

In Article 34, paragraph 4, the following third sentence is added:  

"Where the network concerned is covered by at least one Member State and at least one third 
country,  the  Member  States  concerned  shall  consult  each  other  and  shall  consult  the  third 
countries  concerned,  with  a  view  to  ensuring,  as  regards  the  network  concerned,  that  the 
provisions of this Directive are applied consistently up to the border of Union jurisdiction." 

(4) 

Article 36 is amended as follows: 

(a) in paragraph 3, the following second sentence is added: 

"Where the infrastructure in question is under the jurisdiction of a Member State and one (or 
more) third countries, the national regulatory authority shall consult the relevant authorities of 
the third countries prior to adopting a decision."; 

(b) in the second subparagraph of paragraph 4, the following second sentence is added: 

“Where  the  infrastructure  in  question  is  also  under  the  jurisdiction  of  one  or  more  third 
countries, the national regulatory authorities of the Member States shall consult the relevant 
authorities  of  the  third  countries  prior  to  adopting  a  decision  with  a  view  to  ensuring,  as 
regards  the  concerned  infrastructure,  that  the  provisions  of  this  Directive  are  applied 
consistently up to the border of Union jurisdiction.”; 

(5) 

in Article 41 (1), point c) is replaced by the following: 

"(c) cooperating in regard to cross-border issues with the regulatory authority or authorities of 
the Member States concerned and with the Agency, as well as, for infrastructure to and from 
third  countries,  with  the  relevant  authorities  of  the  third  country  aiming  at,  as  regards  this 
infrastructure,  consistent  application  of  the  provisions  of  this  Directive  up  to  the  border  of 
Union jurisdiction;" 

(6) 

in Article 42, the following paragraph 6 is added: 

"6.  Regulatory  authorities  shall  consult  and  cooperate  with  the  relevant  authorities  of  third 
countries in relation to the operation of gas pipelines to and from third countries with a view 
to ensuring, as regards the concerned infrastructure, that the provisions of this Directive are 
applied consistently up to the border of Union jurisdiction." 

(7) 

in Article 49, the following paragraph 9 is added: 

"In respect of gas pipelines to and from third countries completed before [PO: date of entry 
into force of this Directive], Member States may decide to derogate from Articles 9, 10, 11 
and 32 and Article 41(6), (8) and (10) for the sections of such pipelines between the border of 
Union jurisdiction and the first interconnection point, provided that the derogation would not 
be detrimental to competition on or the effective functioning of the internal market in natural 
gas in the Union, or the security of supply in the Union. 

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The derogation shall be limited in time and may be subject to conditions which contribute to 
the achievement of the above conditions. 

Where  the  gas  pipeline  in  question  is  located  in  the  jurisdiction  of  more  than  one  Member 
State, the Member State in the jurisdiction of which the first interconnection point is located 
shall decide on a derogation for the pipeline. 

Member States shall publish any decision on a derogation in accordance with this paragraph 
within one year after the entry into force of this Directive."  

Article 2 

1. 

Member  States  shall  bring  into  force  the  laws,  regulations  and  administrative 
provisions necessary to comply with this Directive by [PO: one year after the date of 
entry into force] at the latest. They shall forthwith communicate to the Commission 
the text of those provisions. 

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.  

2. 

Member States shall communicate to the Commission the text of the main provisions 
of national law which they adopt in the field covered by this Directive. 

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

Article 3 

This Directive is addressed to the Member States. 

Done at Brussels, 

Article 4 

For the European Parliament 
The President 

For the Council 
The President 

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