CELEX: 62018CC0454
Language: en
Date: 2019-11-14 00:00:00
Title: Opinion of Advocate General Tanchev delivered on 14 November 2019.#Baltic Cable AB v Energimarknadsinspektionen.#Request for a preliminary ruling from the Förvaltningsrätten i Linköping.#Reference for a preliminary ruling — Internal market for electricity — Directive 2009/72/EC — Transmission of electricity — Concept of ‘transmission system operator’ — Regulation (EC) No 714/2009 — Interconnector — Transmission line connecting the national transmission systems of the Member States — Article 16(6) — Scope — Use of revenues resulting from the allocation of interconnection capacity — Undertaking which merely operates a cross-border high-voltage power line connecting two national transmission networks.#Case C-454/18.

OPINION OF ADVOCATE GENERAL
   TANCHEV
   delivered on 14 November 2019 (
         1
      )
   
      Case C‑454/18
   
   Baltic Cable AB
   v
   Energimarknadsinspektionen
   
      (Request for a preliminary ruling from the Förvaltningsrätten i Linköping (Administrative Court, Linköping, Sweden))
   
   (Cross border exchanges in electricity — Regulation (EC) No 714/2009 — Undertaking which merely operates an interconnector — Notion of transmission system operator — Use of the revenues resulting from the allocation of interconnection)
   
            1. 
         
         
            The present case concerns the interpretation of Regulation (EC) No 714/2009, (
                  2
               ) which regulates access to the infrastructure necessary for cross-border exchanges in electricity and, in particular, lays down rules for the financing of that infrastructure.
         
      
            2. 
         
         
            The dispute arose from a decision in which the Swedish regulatory authority, namely the Energimarknadsinspektionen (Swedish Energy Markets Inspectorate) (‘the EI’), (
                  3
               ) requested the operator of the Baltic Cable - a high-voltage electricity cable, otherwise known as an interconnector, that connects the Swedish electricity transmission system to the transmission system in the north-west of Germany - to place its so-called congestion revenues on a separate internal account line, thereby preventing that operator, namely Baltic Cable AB (‘BCAB’), from using those revenues freely.
         
      
            3. 
         
         
            Congestion is a situation in which the capacity of an interconnection between two national transmission systems is insufficient to accommodate all transactions resulting from international trade by market operators. (
                  4
               ) Congestion occurs because of a lack of capacity of interconnectors and/or of the national transmission systems concerned. A recent study reiterated the urgent need for more interconnection capacity in the EU. (
                  5
               )
         
      
            4. 
         
         
            Where there is congestion, non-discriminatory, market-based solutions must be applied to address the problem. (
                  6
               ) Therefore, the available capacity must be auctioned. (
                  7
               ) The price for the auctioned capacity corresponds, in principle, to the wholesale electricity price difference between the two connected transmission systems. That difference, or congestion income, accrues to the operator of the interconnector. (
                  8
               ) Congestion may thus lead to high profits for that operator.
         
      
            5. 
         
         
            Congestion revenues cannot, however, be used freely by the operator of the interconnector. The first subparagraph of Article 16(6) of Regulation No 714/2009 requires that those revenues be used either to guarantee the actual availability of the allocated capacity, or to maintain or increase interconnection capacities through network investments, in particular in new interconnectors. If congestion revenues cannot be used for any of these two purposes, they may be used, up to a maximum amount to be decided by the regulatory authorities of the Member States concerned, to lower network tariffs. The remaining revenues must be placed on a separate internal account line until they can be spent on the two purposes mentioned above.
         
      
            6. 
         
         
            In the present case, the EI decided that BCAB could not use congestion revenues to cover the costs of operation and maintenance of the Baltic Cable because those costs were not incurred to guarantee the actual availability of the allocated capacity or to maintain or increase interconnection capacities through network investments. BCAB was thus requested to place those revenues on a separate internal account line until they could be used for those purposes.
         
      
            7. 
         
         
            The Court is called upon to interpret for the first time Article 16(6) of Regulation No 714/2009 (
                  9
               ) by way of reference from the Förvaltningsrätten i Linköping (Administrative Court, Linköping, Sweden). It is asked to decide whether congestion revenues may be used to cover costs incurred for the operation and maintenance of an interconnector or to distribute profits to the shareholders of that interconnector’s operator. That question is all the more important given that, in the present case, the operation of the interconnector is the sole activity of BCAB. That undertaking claims that the revenues resulting from the allocation of interconnection are its sole source of income, with the result that, were the Court to decide that congestion revenues cannot be used to cover operation and maintenance costs, BCAB would not be able to recover these costs, let alone make a profit. This has led the referring court also to ask the Court whether, if Article 16(6) of Regulation No 714/2009 is to be interpreted as precluding the use of congestion revenues to cover operation and maintenance costs and to make a profit, that provision is valid and whether, in particular, it is consistent with the principle of proportionality.
         
      
      I. Legal framework
   
   
            8.
         
         
            Article 16(6) of Regulation No 714/2009 provides:
            ‘Any revenues resulting from the allocation of interconnection shall be used for the following purposes:
            
                     (a)
                  
                  
                     guaranteeing the actual availability of the allocated capacity; and/or
                  
               
                     (b)
                  
                  
                     maintaining or increasing interconnection capacities through network investments, in particular in new interconnectors.
                  
               If the revenues cannot be efficiently used for the purposes set out in points (a) and/or (b) of the first subparagraph, they may be used, subject to approval by the regulatory authorities of the Member States concerned, up to a maximum amount to be decided by those regulatory authorities, as income to be taken into account by the regulatory authorities when approving the methodology for calculating network tariffs and/or fixing network tariffs.
            The rest of revenues shall be placed on a separate internal account line until such time as it can be spent on the purposes set out in points (a) and/or (b) of the first subparagraph. The regulatory authority shall inform the Agency of the approval referred to in the second subparagraph.’
         
      
      II. The facts, the main proceedings and the questions referred for a preliminary ruling
   
   
            9.
         
         
            As mentioned above, BCAB is a Swedish company whose sole activity is the operation of the Baltic Cable, which it owns. BCAB does not charge any fee for access to the Baltic Cable.
         
      
            10.
         
         
            As required by paragraph 6.5 of Annex I to Regulation No 714/2009, the EI publishes an annual report on the amount and the use of congestion revenues. For that purpose, by letter of 27 May 2014, the EI requested BCAB to provide information concerning the amount and the use of its congestion revenues for the period from 1 July 2013 to 30 June 2014. On 1 July 2014, BCAB indicated that its congestion revenues for that period amounted to 159542374 Swedish kroner (SEK) and that they had been used mainly ‘to guarantee the accessibility and allocation of the transfer capacity on the interconnector’. (
                  10
               )
         
      
            11.
         
         
            In its 2014 report on congestion revenues, the EI stated that BCAB’s use of its congestion revenues had to be analysed in more detail.
         
      
            12.
         
         
            By letter of 29 May 2015, the EI requested BCAB to provide information concerning the amount and the use of its congestion revenues for the period from 1 July 2014 to 30 June 2015. On 1 July 2015, BCAB indicated that its congestion revenues for that period amounted to SEK 177939624 and that they had been used for the same purposes as in the previous year. (
                  11
               )
         
      
            13.
         
         
            In its 2015 report on congestion revenues, the EI stated that it had begun to investigate the use of congestion revenues by BCAB and that that investigation was ongoing.
         
      
            14.
         
         
            By decision of 9 June 2016 (‘the EI’s decision of 9 June 2016’), the EI requested BCAB to place part of its congestion revenues for the periods from 1 July 2013 to 30 June 2014 and from 1 July 2014 to 30 June 2015 on a separate internal account line.
         
      
            15.
         
         
            In the EI’s view, BCAB’s use of congestion revenues (in the amounts of SEK 61016510 for the period from 1 July 2013 to 30 June 2014 and SEK 48995127 for the period from 1 July 2014 to 30 June 2015) to ensure physical firmness (
                  12
               ) was consistent with point (a) of the first subparagraph of Article 16(6) of Regulation No 714/2009, which allows the use of congestion revenues for the purpose of guaranteeing the actual availability of the allocated capacity.
         
      
            16.
         
         
            However, according to the EI, BCAB’s use of congestion revenues (in the amounts of SEK 98480864 for the period from 1 July 2013 to 30 June 2014 and SEK 128944497 for the period from 1 July 2014 to 30 June 2015) to cover the costs incurred for the operation and maintenance of the Baltic Cable was not consistent with Article 16(6) of Regulation No 714/2009. This was because congestion revenues used to operate and maintain an existing interconnector are not used to maintain or increase interconnection capacities, and the use of congestion revenues to cover the costs incurred for the operation and maintenance of the interconnector is thus not permitted by point (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009.
         
      
            17.
         
         
            Consequently, the EI’s decision of 9 June 2016 requested BCAB to place on a separate internal account line the portion of congestion revenues that was used, during the periods from 1 July 2013 to 30 June 2014 and from 1 July 2014 to 30 June 2015, to cover the costs incurred for the operation and the maintenance of the Baltic Cable, until such time as the company could use those revenues for the purposes listed under points (a) and (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009. In the same decision, the EI requested BCAB to submit an extract from its accounts and an auditor’s certification that the revenues in question had been placed on a separate internal account line. Failure to comply with that decision was subject to a penalty payment of SEK 5 million for each month or part thereof in which the decision was not complied with, as from three months from the month in which BCAB was notified of the decision.
         
      
            18.
         
         
            BCAB brought an action before the Förvaltningsrätten i Linköping (Administrative Court, Linköping) seeking the annulment of the EI’s decision of 9 June 2016.
         
      
            19.
         
         
            By decision of 2 November 2017, the EI dismissed BCAB’s request for permission to use its congestion revenues as revenues to be taken into account by the EI when approving the methodology for calculating and/or fixing network tariffs.
         
      
            20.
         
         
            BCAB brought an action before the Förvaltningsrätten i Linköping (Administrative Court, Linköping), claiming that its congestion revenues may be used in accordance with its request mentioned in the preceding point.
         
      
            21.
         
         
            The Förvaltningsrätten i Linköping (Administrative Court, Linköping) is of the opinion that Article 16(6) of Regulation No 714/2009 likely applies not only to undertakings that operate a transmission system, but also to undertakings which, like BCAB, merely operate an interconnector. In that court’s view, it is clear from that provision that BCAB cannot use congestion revenues to make a profit. Moreover, according to that court, only a broad interpretation of that provision would permit the use of congestion revenues to cover operation and maintenance costs. Furthermore, that court considers that BCAB cannot use congestion revenues to lower tariffs since it does not have customers paying tariffs.
         
      
            22.
         
         
            According to the referring court, the interpretation of Article 16(6) of Regulation No 714/2009 in the manner described in the preceding point would bring about consequences which can be regarded as disproportionate. Therefore, that court questions the validity of that provision, in particular in relation to the principle of proportionality.
         
      
            23.
         
         
            Consequently, the Förvaltningsrätten i Linköping (Administrative Court, Linköping) stayed the proceedings and referred the following questions to the Court for a preliminary ruling:
            
                     ‘1.
                  
                  
                     Is Article 16(6) of [Regulation No 714/2009] to apply in all cases where a person obtains revenues resulting from the allocation of interconnection, regardless of his circumstances, or is it to apply only where the person who receives the revenues is a transmission system operator, as defined in Article 2(4) of [Directive 2009/72]?
                  
               
                     2.
                  
                  
                     If the answer to Question 1 is that Article 16(6) of [Regulation No 714/2009] is to apply only to transmission system operators, is an undertaking which merely operates an interconnector a transmission system operator?
                  
               
                     3.
                  
                  
                     If the answer to Question 1 or 2 means that Article 16(6) of [Regulation No 714/2009] is to apply to an undertaking which merely operates an interconnector, can the costs relating to the operation and maintenance of an interconnector in any event be regarded as network investments to maintain or increase transmission capacities, as referred to in point (b) of the first subparagraph of Article 16(6)?
                  
               
                     4.
                  
                  
                     If the answer to Question 1 or 2 means that Article 16(6) of [Regulation No 714/2009] is to apply to an undertaking which merely operates an interconnector, can the regulatory authority, pursuant to the second subparagraph of Article 16(6) of [Regulation No 714/2009], approve that an undertaking which merely operates an interconnector, which has a methodology for fixing tariffs but does not have customers making direct payments with network charges (tariffs) which can be reduced, may use revenues from the allocation of interconnection to make a profit or, if the answer to Question 3 is in the negative, to operate and maintain?
                  
               
                     5.
                  
                  
                     If the answer to Question 1 or 2 means that Article 16(6) of [Regulation No 714/2009] is to apply to an undertaking which merely operates an interconnector, and the answer to Question 3 and 4 means either that the company may not use revenues resulting from the allocation of interconnection to operate or maintain or to make a profit, or that the undertaking may use the revenues to operate or maintain, but not to make a profit, is application of Article 16(6) of [Regulation No 714/2009] to an undertaking which merely operates an interconnector contrary to the EU law principle of proportionality or any other applicable principle?’
                  
               
      
            24.
         
         
            Written observations were submitted by BCAB, the EI, the Kingdom of Spain, the Republic of Finland, the European Parliament, the Council of the European Union and the European Commission. These parties, with the exception of the Republic of Finland, presented oral argument at the hearing on 20 June 2019.
         
      
      III. Analysis
   
   
      
         A.
       
         The first question referred
      
   
   
            25.
         
         
            By the first question, the referring court asks the Court whether Article 16(6) of Regulation No 714/2009 applies in all cases where a person obtains revenues resulting from the allocation of interconnection, or whether it applies only where the person who receives those revenues is a transmission system operator within the meaning of Article 2(4) of Directive 2009/72.
         
      
            26.
         
         
            At the outset, I should note that Article 2(1) of Regulation No 714/2009 states that (with the exception of the definition of ‘interconnector’) the definitions contained in Article 2 of Directive 2009/72 apply. According to Article 2(4) of that directive, a transmission system operator (‘TSO’) is a person responsible for operating, ensuring the maintenance and developing a transmission system, and for ensuring the ability of that system to meet reasonable demands for the transmission of electricity. According to case-law, (
                  13
               ) a transmission system is an interconnected system used to transport electricity at extra-high and high voltage for sale to final customers or to distributors.
         
      
            27.
         
         
            I should also mention that TSOs must be designated and certified as such by national regulatory authorities (
                  14
               ) and that obligations are imposed on them pursuant to EU legislation. In particular they are, under Article 9 of Directive 2009/72, required to unbundle transmission and generation or supply. Under Article 32 of the same directive, they are obliged to give third parties access to their transmission systems, based on published, objective and non-discriminatory tariffs that are subject to prior approval by national regulatory authorities.
         
      
            28.
         
         
            There is no indication in the documents before the Court that BCAB, which built, (
                  15
               ) owns and operates the Baltic Cable, is certified as a TSO by the Swedish regulatory authority, namely the EI. It is not certified by the German regulatory authority, namely the Bundesnetzagentur für Elektrizität, Gas, Telekommunikation, Post und Eisenbahnen (Federal Network Agency for Electricity, Gas, Telecommunications, Post and Railways, Germany) (‘the BNetzA’). It should be mentioned, in that regard, that, by judgment of 7 March 2017, (
                  16
               ) the Bundesgerichtshof (Federal Court of Justice, Germany) ruled that BCAB was obliged to obtain certification as a TSO, but nonetheless refused to certify it as a TSO on the ground that it had not demonstrated that it met the unbundling requirement. (
                  17
               )
         
      
            29.
         
         
            BCAB submits that Article 16(6) of Regulation No 714/2009 applies only to TSOs, and that undertakings which merely operate an interconnector cannot be regarded as TSOs, with the result that the latter fall outside the scope of that provision. (
                  18
               ) BCAB argues that undertakings which merely operate an interconnector are not in the same situation as TSOs. Indeed, undertakings which operate not only an interconnector, but also a transmission system can cover the costs incurred for the operation and maintenance of the interconnector by means of the tariffs paid by the users of the transmission system. By contrast, undertakings which merely operate an interconnector do not receive any tariffs. In BCAB’s view, it follows that, if Article 16(6) of Regulation No 714/2009 is applied to the latter undertakings, they cannot cover their costs and they will not be able to carry out their task, that is, operate the interconnector.
         
      
            30.
         
         
            The EI, the Spanish and the Finnish Governments, the Parliament, the Council and the Commission are of the opposite opinion.
         
      
            31.
         
         
            The EI contends that Article 16(6) of Regulation No 714/2009 applies in all cases where a person obtains revenues resulting from the allocation of interconnection. In its view, this follows from the wording of that provision, the legislative history of Regulation No 714/2009 and the fact that Article 17 of that regulation provides for the possibility of exempting new interconnectors from Article 16(6) thereof, which implies that the latter provision applies to existing interconnectors. The EI further contends that, in any event, an undertaking which merely operates an interconnector is a TSO.
         
      
            32.
         
         
            The Spanish and the Finnish Governments consider that an undertaking which merely operates an interconnector must be regarded as a TSO, to which Article 16(6) of Regulation No 714/2009 applies. They rely on the definition of the notion of TSO set out in Article 2(4) of Directive 2009/72 and on Article 17 of Regulation No 714/2009.
         
      
            33.
         
         
            The Parliament (
                  19
               ) is of the opinion that Article 16(6) of Regulation No 714/2009 applies to existing interconnectors.
         
      
            34.
         
         
            The Council contends that Article 16(6) of Regulation No 714/2009 applies to undertakings which merely operate an interconnector since otherwise there would be a legal vacuum and an incentive for undertakings to operate only an interconnector.
         
      
            35.
         
         
            The Commission contends that Article 16(6) of Regulation No 714/2009 applies in all cases where a person obtains revenues resulting from the allocation of interconnection. This follows from the very wording of that provision; from its objective, which is to ensure that congestion revenues are used to increase investment in interconnection capacities and thereby contribute to the security of supply; and from the fact that, according to Article 17(1)(c) of Regulation No 714/2009, an exemption may be granted to an interconnector owned by a person legally separate from the TSOs in whose systems it is built, which implies that Article 16(6) of the same regulation applies to such an interconnector. The Commission further contends that, in any event, an undertaking which merely operates an interconnector must be considered a TSO since, first, that undertaking fulfils the criteria set out in Article 2(4) of Directive 2009/72, and, second, there would otherwise be a legal vacuum and it would be possible to circumvent the legal obligations imposed on TSOs by that directive.
         
      
            36.
         
         
            I consider that Article 16(6) of Regulation No 714/2009 applies in all cases where an undertaking obtains revenues resulting from the allocation of interconnection, irrespective of whether that undertaking is a TSO. I shall set out below the reasons why I have come to that conclusion.
         
      
            37.
         
         
            It is settled case-law that the interpretation of a provision of EU law requires that account be taken not only of its wording and the objectives it pursues, but also of its context and the provisions of EU law as a whole. The origins of a provision of EU law may also provide information relevant to its interpretation. (
                  20
               )
         
      
            38.
         
         
            First, the first subparagraph of Article 16(6) of Regulation No 714/2009 states that ‘any revenues resulting from the allocation of interconnection shall be used for’ the purposes set out in points (a) and/or (b) thereof. There is no condition as to the person obtaining those revenues. There is, in particular, no mention of TSOs in Article 16(6) of Regulation No 714/2009. Therefore, it suffices, for that provision to apply, that revenues are obtained from the allocation of interconnection. That is the case of congestion revenues, which, as explained in point 4 above, accrue from auctions held where there is congestion. It is irrelevant whether those revenues are obtained by TSOs or other persons.
         
      
            39.
         
         
            I acknowledge that Article 16(1), (2), (4) and (5) of Regulation No 714/2009 refer to TSOs. However, those paragraphs concern, respectively, the requirement to use market-based solutions (which should give efficient economic signals to TSOs) to address congestion problems (paragraph 1); the permission (given to TSOs) to use transaction curtailment procedures in emergency situations (paragraph 2); the obligation on market operators to inform TSOs in advance whether they intend to use the allocated capacity (paragraph 4); and the requirement on TSOs to use the interconnection line to its maximum capacity, as far as technically possible (paragraph 5). Those paragraphs do not concern the use of revenues resulting from the allocation of interconnection. By contrast, Article 16(6) of Regulation No 714/2009, which specifically concerns that issue, makes no reference to TSOs.
         
      
            40.
         
         
            Second, as regards context, reference should be made to Article 17 of Regulation No 714/2009. That article provides for the possibility of exempting new interconnectors from Article 16(6) of that regulation. This means that, where no exemption is granted, Article 16(6) of Regulation No 714/2009 applies to interconnectors. In particular, given that, pursuant to Article 17(1) of that regulation, an exemption may only be granted to ‘new’ interconnectors, that is, interconnectors not completed by 4 August 2003, (
                  21
               ) Article 16(6) of Regulation No 714/2009 applies to all interconnectors completed before 4 August 2003 (‘existing interconnectors’). That is the case of the Baltic Cable, which was completed before that date.
         
      
            41.
         
         
            Third, as regards the objective of Regulation No 714/2009, I should note that that regulation seeks to develop cross-border exchanges in electricity, so as to achieve efficiency gains, competitive prices, higher standards of service, and to contribute to security of supply and sustainability. (
                  22
               ) To that end, investment in major new infrastructures should be promoted. (
                  23
               ) This concerns in particular interconnectors, given that interconnection capacity is insufficient. (
                  24
               )
         
      
            42.
         
         
            Against that background, Article 16(6) of Regulation No 714/2009 ensures that certain revenues, namely those resulting from the allocation of interconnection, are used to maintain existing interconnection capacity or invest in new capacity. Indeed, points (a) and (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009 ensure that those revenues, rather than being used freely by the operator of the interconnector, are used either to ‘guarant[ee] the actual availability of the allocated capacity’ or to ‘maint[ain] or increas[e] interconnection capacities through network investments, in particular in new interconnectors’. It is only if they cannot be ‘efficiently used’ for those purposes that, according to the second subparagraph of Article 16(6) of Regulation No 714/2009, those revenues may be used to lower network tariffs, subject to approval by the regulatory authorities of the Member States concerned and up to a maximum amount. Moreover, revenues above that maximum amount must, pursuant to the third subparagraph of that provision, be placed on a separate internal account line until they can be spent on the purposes set out in points (a) or (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009.
         
      
            43.
         
         
            The reason why the EU legislature decided that the revenues used to maintain existing interconnection capacity or invest in new capacity should be those resulting from the allocation of interconnection is that the latter revenues are scarcity rents. That is, the operator of the interconnector receives congestion revenues where there is congestion and the available capacity is auctioned, resulting in profits that correspond to the wholesale price difference between the two transmission systems concerned. Where there is no congestion, the wholesale prices in the interconnected transmission systems are close and the operator of the interconnector does not obtain, or obtains lower, congestion revenues. It follows that the operator of the interconnector has no incentive to develop interconnection capacity. (
                  25
               ) It was thus necessary to impose an obligation to use congestion revenues for the purposes set out in points (a) and (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009.
         
      
            44.
         
         
            I see no reason why that obligation should be imposed only on TSOs. On the contrary, it seems to me that the objective of Regulation No 714/2009 and the rationale of Article 16(6) thereof call for the application of the latter provision to all persons who receive congestion revenues.
         
      
            45.
         
         
            Fourth, as regards legislative history, I should observe that the preparatory works of Regulation No 1228/2003 (
                  26
               ) show that the possibility of exempting interconnectors from the restrictions on the use of congestion revenues was proposed by the Parliament (
                  27
               ) in order to ‘allow for the financing of interconnector projects on an entrepreneurial basis’ and to ‘allow for the fact that these projects could be developed by a party other than the TSO’. (
                  28
               )
         
      
            46.
         
         
            In that regard, I should point out that interconnectors are built either by the operators of the transmission systems which they connect, in which case investment costs are recovered through regulated transmission tariffs charged by those TSOs in accordance with Article 32 of Directive 2009/72 and Article 14 of Regulation No 714/2009, or by market parties, which cannot recover investment costs through regulated transmission tariffs as they do not operate a transmission system, but are nonetheless interested in investing in interconnectors in order to capture the congestion revenues (which, as mentioned in point 4 above, may be substantial and thus allow them to recover their costs and make high profits). The latter interconnectors are often referred to as ‘merchant’ interconnectors. (
                  29
               ) It seems that BCAB belongs to that category, given that it has not been alleged that it has any links with the Swedish or the German TSOs.
         
      
            47.
         
         
            The Parliament’s reference, in the citation at point 45 above, to interconnectors ‘financed on an entrepreneurial basis’ and ‘developed by a party other than a TSO’ is a reference to merchant interconnectors. It follows that, in the Parliament’s view, the restriction on the use of congestion revenues was to apply to interconnectors developed by TSOs, while ‘entrepreneurial’, or merchant interconnectors developed by parties other than TSOs were to be exempted from the rules on the use of congestion revenues. (
                  30
               )
         
      
            48.
         
         
            However, in the final version of Article 7 of Regulation No 1228/2003, now Article 17 of Regulation No 714/2009, the scope of the exemption was limited to new interconnectors, as opposed to existing ones. (
                  31
               ) It follows that the dividing line is between new and existing interconnectors, and that only the former may be granted an exemption. In other words, the dividing line is not between interconnectors financed and operated by TSOs and interconnectors developed by parties other than TSOs, as was the Parliament’s intention. It follows that existing interconnectors, whether developed and operated by TSOs or by parties other than TSOs, fall outside the scope of Article 17 of Regulation No 714/2009 and that, therefore, they fall within the scope of Article 16(6) of that regulation.
         
      
            49.
         
         
            Therefore, the answer to the first question referred should be that Article 16(6) of Regulation No 714/2009 applies in all cases where a person obtains revenues resulting from the allocation of interconnection, irrespective of whether that person is a transmission system operator within the meaning of Article 2(4) of Directive 2009/72.
         
      
      
         B.
       
         The second question referred
      
   
   
            50.
         
         
            By the second question, the referring court asks the Court whether, if Article 16(6) of Regulation No 714/2009 is interpreted as applying only where the person who receives revenues resulting from the allocation of interconnection is a TSO, an undertaking which merely operates an interconnector must be regarded as a TSO within the meaning of Article 2(4) of Directive 2009/72.
         
      
            51.
         
         
            It follows from point 49 above that there is no need to answer the second question. However, in case the Court should decide that Article 16(6) of Regulation No 714/2009 applies only where the person who receives the revenues resulting from the allocation of interconnection is a TSO, I shall examine it.
         
      
            52.
         
         
            As mentioned above, (
                  32
               ) BCAB submits that an undertaking which merely operates an interconnector cannot be regarded as a TSO. By contrast, the Spanish and the Finnish Governments and the Commission contend that that undertaking must be regarded as a TSO. The Parliament and the Council did not take a position on this issue.
         
      
            53.
         
         
            In my opinion, an undertaking which merely operates an interconnector should be considered a TSO within the meaning of Article 2(4) of Directive 2009/72.
         
      
            54.
         
         
            First, it is true that Article 2(1) of Regulation No 714/2009 defines the notion of ‘interconnector’ as ‘a transmission line’ which connects national transmission systems, not as a ‘transmission system’. However, I should note that Article 2(3) of Directive 2009/72 defines the notion of ‘transmission’ as ‘the transport of electricity on the extra high-voltage and high-voltage interconnected system with a view to its delivery to final customers or to distributors’ (supply excluded). As mentioned in point 26 above, this has led the Court to rule that a transmission system is ‘an interconnected system used to transport electricity at extra-high and high voltage for sale to final customers or to distributors’. (
                  33
               ) I see no reason why the ‘transport’ of electricity on an interconnector should not be regarded as ‘transmission’ of electricity within the meaning of Article 2(3) of Directive 2009/72, and why, therefore, that interconnector should not be regarded as a transmission system within the meaning of the case-law.
         
      
            55.
         
         
            Second, according to Article 2(4) of Directive 2009/72, a TSO is ‘a natural or legal person 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 for ensuring the long-term ability of the system to meet reasonable demands for the transmission of electricity’. (
                  34
               ) It is true that that provision makes a distinction between, on the one hand, transmission systems, and, on the other hand, interconnections between those systems. However, in so far as Article 2(4) of Directive 2009/72 entrusts TSOs with the operation of interconnectors, it seems to me that interconnectors should be regarded as transmission systems.
         
      
            56.
         
         
            Third, I should observe that, as mentioned in point 39 above, Article 16(2) and (5) of Regulation No 714/2009 entrusts TSOs with congestion management tasks (respectively, the use of transaction curtailment procedures in emergency situations and the use of a congested interconnection line to its maximum capacity), and that it makes no reference to other operators.
         
      
            57.
         
         
            Fourth, I should point out that Article 17 of Regulation No 714/2009 provides for the possibility of exempting new interconnectors not only from Article 16(6) of that regulation, but also from Articles 9, 32 and Article 37(6) and (10) of Directive 2009/72. Whereas Article 16(6) of Regulation No 714/2009 applies in all cases where a person receives congestion revenues, the abovementioned provisions of Directive 2009/72 apply only to TSOs. Article 9 of that directive sets out the unbundling requirements that a TSO must fulfil. Article 32 and Article 37(6) and (10) of the same directive provide for an obligation to give third parties access to transmission systems based on published, objective and non-discriminatory tariffs that are subject to prior approval by the national regulatory authority. This means that interconnectors which have not been granted an exemption under Article 7 of Regulation No 714/2009 (or Article 7 of Regulation No 1228/2003), in particular, existing interconnectors, are subject to Article 9, Article 32 and Article 37(6) and (10) of Directive 2009/72. Given that those provisions apply only to TSOs, this implies that those interconnectors must be operated by TSOs.
         
      
            58.
         
         
            Fifth, the solution proposed in point 53 above is consistent with the objective of Regulation No 714/2009.
         
      
            59.
         
         
            Indeed, if the operators of interconnectors are TSOs, they are obliged to give third parties access to the interconnector, which allows for the development of cross-border trade and facilitates the emergence of an internal market in electricity, in accordance with Article 1(b) of Regulation No 714/2009.
         
      
            60.
         
         
            Furthermore, if the operators of interconnectors are TSOs, they must abide by the unbundling requirements set out in Article 9 of Directive 2009/72. This should also encourage cross-border trade since, as the impact assessment for Regulation No 714/2009 observes, ‘vertically integrated companies have a disincentive to invest in their networks’. This is because ‘congestion revenues are often higher than expected profits from building new links’, which ‘is an obstacle to the integration of the European market through the development of cross-border interconnections’. (
                  35
               )
         
      
            61.
         
         
            Therefore, should the Court interpret Article 16(6) of Regulation No 714/2009 as applying only to TSOs, the answer to the second question referred should be that an undertaking which merely operates an interconnector must be regarded as a TSO.
         
      
      
         C.
       
         The third and the fourth questions referred
      
   
   
            62.
         
         
            By the third question, the referring court essentially asks the Court whether, if Article 16(6) of Regulation No 714/2009 is interpreted as applying to an undertaking which merely operates an interconnector, the costs incurred for the operation and the maintenance of that interconnector may be regarded as network investments to maintain or increase interconnection capacities within the meaning of point (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009.
         
      
            63.
         
         
            By the fourth question, the referring court essentially asks the Court whether, if Article 16(6) of Regulation No 714/2009 is interpreted as applying to an undertaking which merely operates an interconnector, the second subparagraph of that provision allows that undertaking to use the revenues resulting from the allocation of interconnection to make a profit, given that it cannot use those revenues to lower network tariffs as it does not charge a tariff. The referring court also asks the Court of Justice whether, if the third question is answered in the negative, the second subparagraph of Article 16(6) of Regulation No 714/2009 allows the revenues resulting from the allocation of interconnection to be used to cover the costs incurred for the operation and maintenance of the interconnector.
         
      
            64.
         
         
            I shall examine these questions together.
         
      
            65.
         
         
            BCAB submits that revenues used to cover the operating costs of an interconnector are used for the purpose set out in point (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009, while revenues used to cover maintenance costs are used for the purpose set out in point (a) of that subparagraph. BCAB further submits that, in any event, the second subparagraph of Article 16(6) of Regulation No 714/2009 allows the revenues resulting from the allocation of interconnection to be used to cover any costs incurred by an undertaking which merely operates an interconnector. Finally, BCAB emphasises that such an undertaking has no revenues other than those resulting from the allocation of interconnection. In particular, it cannot charge a fee for the use of a transmission system as it does not operate a transmission system, and it cannot charge a fee for the use of the interconnector as this would be inconsistent with Article 14 of Regulation No 714/2009.
         
      
            66.
         
         
            The EI contends that revenues used to cover an interconnector’s operation and maintenance costs are not used for the purpose set out in point (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009. In the EI’s view, the revenues resulting from the allocation of interconnection cannot be used to reduce network tariffs as BCAB does not charge a tariff. They cannot be used to make a profit as this would be inconsistent with the wording of Article 16(6) of Regulation No 714/2009. Moreover, according to the EI, an undertaking which merely operates an interconnector cannot have revenues other than those resulting from the allocation of interconnection, given that charging a fee for the use of the interconnector would be inconsistent with Article 14 of that regulation.
         
      
            67.
         
         
            The Spanish Government considers that an undertaking which merely operates an interconnector may obtain revenues other than those resulting from the allocation of interconnection.
         
      
            68.
         
         
            The Finnish Government is of the opinion that revenues used to cover an interconnector’s operation and maintenance costs are not used for investing in the network as required by point (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009. However, in the Finnish Government’s view, the national regulatory authority may, on the basis of Article 37(6) of Directive 2009/72 and of the second subparagraph of Article 16(6) of Regulation No 714/2009, authorise BCAB to use the revenues resulting from the allocation of interconnection to cover operation and maintenance costs and to make a profit, up to a maximum amount set by that authority. Revenues in excess of that amount must be placed on a separate internal account line.
         
      
            69.
         
         
            The Parliament (
                  36
               ) submits that, based on a literal interpretation of points (a) and (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009, revenues used to cover an interconnector’s operation and maintenance costs may be regarded as used for the purposes set out in that subparagraph. However, the Parliament observes that the first subparagraph of Article 16(6) of Regulation No 714/2009 is normally interpreted more restrictively by national regulatory authorities. In the Parliament’s view, an interconnector’s operation and maintenance costs should be recovered in priority not through the revenues resulting from the allocation of interconnection, but through other revenues which an undertaking that merely operates an interconnector may obtain. The latter revenues may result from (i) compensation for the fulfilment of a public service obligation pursuant to Article 3(6) of Directive 2009/72; (ii) transmission or distribution tariffs approved by national regulatory authorities pursuant to Article 37 of the same directive; or (iii) other appropriate mechanisms as referred to by Article 75 of Regulation 2015/1222.
         
      
            70.
         
         
            The Council considers that an undertaking which merely operates an interconnector may have revenues other than those resulting from the allocation of interconnection.
         
      
            71.
         
         
            The Commission submits that revenues used to cover an interconnector’s operation and maintenance costs are not used for the purpose set out in point (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009, and that nothing in the second subparagraph of that provision suggests that the revenues resulting from the allocation of interconnection may be used to make a profit. The Commission further submits that an undertaking which merely operates an interconnector may have revenues other than those resulting from the allocation of interconnection. Indeed, a national regulatory authority may decide that general tariffs paid by all users of the national transmission system will cover a portion of the costs incurred by interconnectors. That is the case of the German ‘Offshore-Umlage’. Those costs may also be covered by subventions, provided that the latter are consistent with State aid rules.
         
      
            72.
         
         
            In my opinion, revenues used to cover the costs incurred for the operation and maintenance of an interconnector and to make a reasonable profit, may be regarded as used for the purposes set out in points (a) and (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009. However, where an undertaking which merely operates an interconnector obtains other revenues as will be described below, the interconnector’s operation and maintenance costs should be covered in priority by the latter revenues.
         
      
            73.
         
         
            First, it seems to me that revenues used to cover the costs incurred for the maintenance of an interconnector are used for the purpose set out in point (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009, namely ‘maintaining or increasing interconnection capacities through network investments, in particular in new interconnectors’. Indeed, given that point (b) covers ‘in particular’ investments in new interconnectors, it also covers investments in existing interconnectors. Moreover, point (b) covers investments made not only to ‘increas[e]’ interconnection capacities, but also to ‘maintai[n]’ the capacity of an interconnector and thereby allow that interconnector to function properly.
         
      
            74.
         
         
            Reference should be made, in that regard, to Article 19(2) of Regulation (EU) 2019/943, (
                  37
               ) which will repeal and replace Regulation No 714/2009 as of 1 January 2020. Although Regulation 2019/943 is not applicable to the main proceedings, it may be of interest to note that Article 19(2)(b) thereof, which corresponds to point (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009, covers, in particular, ‘costs resulting from network investments that are relevant to reduce interconnector congestion’. Costs incurred to maintain an interconnector help prevent congestion, since congestion is likely to occur on a poorly maintained interconnector.
         
      
            75.
         
         
            Second, an interconnector’s operating costs are not, in my view, incurred for the purpose of maintaining or increasing interconnection capacities as set out in point (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009. They may, however, be regarded as incurred for the purpose set out in point (a) of the same subparagraph, that is, ‘guaranteeing the actual availability of the allocated capacity’.
         
      
            76.
         
         
            I should note, in that regard, that, although the referring court enquired only as to the interpretation of point (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009, it is also necessary to consider point (a) of that subparagraph in order to answer the third and the fourth questions referred. This is because both points are linked. This is also because the fourth question concerns the interpretation of the second subparagraph of Article 16(6) of Regulation No 714/2009, which applies only if the revenues resulting from the allocation of interconnection cannot be used for the purposes set out in points (a) and/or
               (b) of the first subparagraph.
         
      
            77.
         
         
            It seems to me that operating costs arise from the allocation of capacity on the interconnector and from the actions taken to ensure that that capacity is available. It follows that those costs are covered by the purpose set out in point (a) of the first subparagraph of Article 16(6) of Regulation No 714/2009. This is confirmed by Article 19(2) of Regulation 2019/943, which specifies that the purpose set out in point (a) ‘include[es]’, hence is not limited to, firmness compensation. (
                  38
               )
         
      
            78.
         
         
            It also seems to me that the costs incurred for the purposes set out in points (a) and (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009 should include a reasonable profit. In that regard, I should note that the statement in Article 6(6) of the Commission’s proposal for Regulation No 1228/2003 (
                  39
               ) that revenues resulting from the allocation of interconnection ‘shall not constitute a source of extra profit for the [TSOs]’, does not appear in the final version of that provision or in Article 16(6) of Regulation No 714/2009. I should also note that, under paragraph 6.4 of Annex I of Regulation No 714/2009, national regulatory authorities must verify that the congestion income obtained by the operators of interconnectors is used consistently with Article 16(6) of that regulation. Therefore, those authorities can ensure that the amount of the profit made by those operators is not such as to jeopardise the operation and maintenance of the interconnector, or to preclude investments in new interconnection capacities. (
                  40
               )
         
      
            79.
         
         
            Third, the solution proposed in point 72 above is consistent with the objective of Article 16(6) of Regulation No 714/2009, which, as mentioned in point 42 of this Opinion, is not only to increase interconnection capacity, but also to maintain the existing capacity. Moreover, if Article 16(6) of Regulation No 714/2009 were interpreted as prohibiting the use of the revenues resulting from the allocation of interconnection to operate and maintain an existing interconnector and to make a reasonable profit, this could jeopardise investments in new interconnectors. As mentioned in point 46 above, market parties may invest in new interconnectors in order to capture congestion revenues. However, if Article 16(6) of Regulation No 714/2009 is interpreted as precluding the use of congestion revenues to make a profit, market parties may lose their interest in the investment. It is true that they may, under Article 17 of Regulation No 714/2009, obtain an exemption from Article 16(6) of that regulation, which will allow them free use of the congestion revenues. However, exemptions are only granted for a limited period of time. (
                  41
               )
         
      
            80.
         
         
            Fourth, contrary to what BCAB and the EI submit, an undertaking which merely operates an interconnector may have revenues other than those resulting from the allocation of interconnection. As mentioned in point 72 above, it seems to me that, where that is the case, the interconnector’s operation and maintenance costs should be covered in priority by those other revenues.
         
      
            81.
         
         
            In that regard, I agree with BCAB and the EI that an undertaking which merely operates an interconnector cannot recover the costs incurred for the operation and maintenance of the interconnector by charging network tariffs. This is because such an undertaking does not charge a tariff for access to one of the transmission systems linked by the interconnector, given that it does not operate one of those systems. This is also because it cannot charge a tariff for access to the interconnector itself since this would increase the price of cross-border exchanges in electricity as compared to the price of domestic sales, which would jeopardise the achievement of the internal market in electricity. This would also be inconsistent with Article 14(5) of Regulation No 714/2009, which precludes ‘specific network charge[s] on individual transactions for declared transits of electricity’. As recital 15 of that regulation explains, ‘it would not be appropriate to apply … a specific tariff to be paid only by exporters or importers in addition to the general charge for access to the national network’.
         
      
            82.
         
         
            However, contrary to what BCAB and the EI contend, an undertaking which merely operates an interconnector may nonetheless obtain revenues other than those resulting from the allocation of interconnection.
         
      
            83.
         
         
            In that respect, it is apparent from recital 29 of Regulation No 714/2009 that that regulation does not fully harmonise the framework for cross-border exchanges in electricity. In particular, Article 18 thereof empowers the Commission to adopt guidelines that may concern ‘details of rules for the trading of electricity’, (
                  42
               ) or details in the areas of third-party access, congestion management and transmission tariff structures. (
                  43
               ) Moreover, those guidelines should only achieve ‘the minimum degree of harmonisation required’ by the objectives of Regulation No 714/2009. (
                  44
               )
         
      
            84.
         
         
            Furthermore, Article 16(6) of Regulation No 714/2009 precludes the use of the revenues resulting from the allocation of interconnection for purposes other than those set out in the first and the second subparagraphs thereof. It certainly does not preclude operators of interconnectors from obtaining other revenues, nor that those other revenues may be used for purposes other than guaranteeing the actual availability of the allocated capacity, or maintaining or increasing interconnection capacities through network investments.
         
      
            85.
         
         
            I should note that Article 37(6)(c) of Directive 2009/72 provides that national regulatory authorities are responsible for fixing or approving the methodologies, or the terms and conditions for access to cross-border infrastructure, including congestion management. On that basis, they could, as the Commission submits, decide that the tariff levied on all the users of the national transmission system should be used in part to cover the costs incurred for the operation and maintenance of interconnectors. This would be consistent with recital 15, Article 14(5) and the objective of Regulation No 714/2009 since all the users of the national transmission system, rather than the sole users of an interconnector, would be charged for the costs incurred for the operation and maintenance of that interconnector. As the Commission submits, an example of such mechanism is provided by the German ‘Offshore-Umlage’ (offshore charge), which is collected by network operators as a supplement to the general network charge and is levied on all end consumers connected to the public grid. That ‘Offshore-Umlage’ covers the costs of planning, building and operating the lines connecting offshore wind installations to the main grid. (
                  45
               )
         
      
            86.
         
         
            It seems to me that, as the Parliament submitted at the hearing, where a regulatory framework is in place which provides for a charge that covers the costs incurred for the operation and maintenance of interconnectors, those costs should be covered in priority by that charge. Therefore, in that situation, an undertaking which merely operates an interconnector should use the revenues resulting from the allocation of interconnection in priority for purposes other than operating and maintaining the interconnector, for instance to increase the capacity of an existing interconnector or to invest in a new interconnector. This is, in my view, required by the rationale of Article 16(6) of Regulation No 714/2009, as described in point 43 above.
         
      
            87.
         
         
            Consequently, the answer to the third and the fourth questions should be that points (a) and (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009 must be interpreted as meaning that the revenues resulting from the allocation of interconnection may be used to cover the costs incurred for the operation and maintenance of an interconnector and to make a reasonable profit, subject to approval by the regulatory authorities of the Member States concerned that shall verify whether the amount of that profit is not such as to jeopardise the operation and maintenance of the interconnector or investments in new interconnection capacities. However, where a regulatory framework is in place which provides for a charge that covers the costs of operation and maintenance of interconnectors, points (a) and (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009 must be interpreted as meaning that an undertaking which merely operates an interconnector should use the revenues resulting from the allocation of interconnection in priority for purposes other than operating and maintaining the interconnector, for instance to increase the capacity of an existing interconnector or to invest in a new interconnector.
         
      
      
         D.
       
         The fifth question referred
      
   
   
            88.
         
         
            By the fifth question, the referring court asks the Court whether, if Article 16(6) of Regulation No 714/2009 is interpreted as applying to an undertaking which merely operates an interconnector and as precluding the use of the revenues resulting from the allocation of interconnection to cover the costs of the operation and maintenance of the interconnector and to make a profit, that provision is consistent with the principle of proportionality, or any other applicable principle. Reference is made, in the order for reference, to the right to property.
         
      
            89.
         
         
            BCAB contends that Article 16(6) of Regulation No 714/2009, if it is interpreted as precluding an undertaking which merely operates an interconnector from using the revenues resulting from the allocation of interconnection to operate and maintain the interconnector and to make a profit, is inconsistent with the principle of proportionality, given that that undertaking cannot operate under those conditions and it cannot remain on the market. The EI agrees with BCAB. The Spanish and the Finnish Governments, the Parliament, the Council and the Commission submit that Article 16(6) of Regulation No 714/2009 is consistent with the principle of proportionality.
         
      
            90.
         
         
            Moreover, BCAB argues that Article 16(6) of Regulation No 714/2009 is inconsistent with its right to property as it precludes free use of congestion revenues. (
                  46
               ) The Parliament and the Council submit that that provision is consistent with the right to property. The EI, the Spanish and the Finnish Governments, and the Commission do not take a position.
         
      
            91.
         
         
            First, I consider that Article 16(6) of Regulation No 714/2009 is consistent with the principle of proportionality.
         
      
            92.
         
         
            According to settled case-law, the principle of proportionality, which is one of the general principles of EU law, requires that acts adopted by EU institutions do not exceed the limits of what is appropriate and necessary in order to attain the legitimate objectives pursued by the legislation in question; where there is a choice between several appropriate measures, recourse must be had to the least onerous, and the disadvantages caused must not be disproportionate to the aims pursued. (
                  47
               )
         
      
            93.
         
         
            Article 16(6) of Regulation No 714/2009 is capable of achieving the objective pursued by that regulation, namely to develop cross-border exchanges in electricity so as to achieve efficiency gains, competitive prices and higher standards of service, as described in point 41 above. By ensuring that certain revenues, namely those resulting from the allocation of interconnection, are used to maintain existing interconnection capacity or to invest in new capacity, that provision seeks to develop cross-border trade.
         
      
            94.
         
         
            With regard to the strict necessity of Article 16(6) of Regulation No 714/2009, I should note that, as explained above, that provision does not preclude an undertaking which merely operates an interconnector from using the revenues resulting from the allocation of interconnection to operate and maintain the interconnector (unless regulated revenues are available for that purpose, in which case the latter should be used in priority). It does not preclude that undertaking from making a reasonable profit. In the light of the broad discretion enjoyed by the EU legislature in areas in which its action involves political, economic and social choices and in which it is called upon to undertake complex assessments and evaluations, (
                  48
               ) Article 16(6) of Regulation No 714/2009 does not, in my view, go beyond what is necessary to achieve the objective pursued.
         
      
            95.
         
         
            Second, I consider that Article 16(6) of Regulation No 714/2009 is consistent with the right to property, as enshrined in Article 17(1) of the Charter of Fundamental Rights of the European Union (‘the Charter’).
         
      
            96.
         
         
            I should note that the right to property guaranteed by Article 17(1) of the Charter is not absolute. As is apparent from Article 52(1) of the Charter, limitations may be imposed on the exercise of the rights recognised by the Charter, as long as the limitations are provided for by law, respect the essence of those rights and, subject to the principle of proportionality, are necessary and genuinely meet objectives of general interest recognised by the European Union or the need to protect the rights or freedoms of others. (
                  49
               )
         
      
            97.
         
         
            The restriction on the use of the revenues resulting from the allocation of interconnection must be regarded as provided for by law within the meaning of Article 52(1) of the Charter, since it stems from Article 16(6) of Regulation No 714/2009. (
                  50
               ) Moreover, as the Council submits, that provision does not preclude recovery of the costs incurred for the operation and maintenance of an interconnector. It does not preclude making a reasonable profit. Therefore, it respects the essence of the right to property. Furthermore, it follows from points 93 and 94 above that Article 16(6) of Regulation No 714/2009 pursues an objective of general interest, namely the development of cross-border exchanges in electricity, and that it is necessary.
         
      
            98.
         
         
            Therefore, the answer to the fifth question should be that the consideration of that question has disclosed no factor such as to affect the validity of Article 16(6) of Regulation No 714/2009.
         
      
      IV. Conclusion
   
   
            99.
         
         
            In the light of the foregoing, I propose that the Court give the following reply to the questions referred by the Förvaltningsrätten i Linköping (Administrative Court, Linköping, Sweden):
            
                     (1)
                  
                  
                     Article 16(6) of Regulation (EC) No 714/2009 of the European Parliament and of the Council of 13 July 2009 on conditions for access to the network for cross-border exchanges in electricity and repealing Regulation (EC) No 1228/2003 applies in all cases where a person obtains revenues resulting from the allocation of interconnection, irrespective of whether that person is a transmission system operator within the meaning of Article 2(4) of Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC.
                  
               
                     (2)
                  
                  
                     Points (a) and (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009 must be interpreted as meaning that the revenues resulting from the allocation of interconnection may be used to cover the costs incurred for the operation and maintenance of an interconnector and to make a reasonable profit, subject to approval by the regulatory authorities of the Member States concerned that shall verify whether the amount of that profit is not such as to jeopardise the operation and maintenance of the interconnector or investments in new interconnection capacities. However, where a regulatory framework is in place which provides for a charge that covers the costs of operation and maintenance of interconnectors, points (a) and (b) of the first subparagraph of Article 16(6) of Regulation No 714/2009 must be interpreted as meaning that an undertaking which merely operates an interconnector should use the revenues resulting from the allocation of interconnection in priority for purposes other than operating and maintaining the interconnector, for instance to increase the capacity of an existing interconnector or to invest in a new interconnector.
                  
               
                     (3)
                  
                  
                     Consideration of the fifth question referred for a preliminary ruling has disclosed no factor such as to affect the validity of Article 16(6) of Regulation No 714/2009.
                  
               
      (
         1
      )	Original language: English.
   (
         2
      )	Regulation of the European Parliament and of the Council of 13 July 2009 on conditions for access to the network for cross-border exchanges in electricity and repealing Regulation (EC) No 1228/2003 (OJ 2009 L 211, p. 15). Regulation No 714/2009 is part of the so-called ‘third legislative package’, which also consists of Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC (OJ 2009 L 211, p. 55) and of Regulation (EC) No 713/2009 of the European Parliament and of the Council of 13 July 2009 establishing an Agency for the Cooperation of Energy Regulators (OJ 2009 L 211, p. 1).
   (
         3
      )	Article 35(1) of Directive 2009/72, to which Article 2(2)(a) of Regulation No 714/2009 refers, requires each Member State to designate a national regulatory authority. The powers and duties of that authority are defined by Article 37 of Directive 2009/72.
   (
         4
      )	See paragraph 4 of Section III of the Explanatory Memorandum to the Proposal for a Regulation of the European Parliament and of the Council on conditions for access to the network for cross-border exchanges in electricity, presented by the Commission on 13 March 2001 (‘the Commission’s proposal’) (COM(2001) 125 final). That proposal led to the adoption of Regulation (EC) No 1228/2003 of the European Parliament and of the Council of 26 June 2003 on conditions for access to the network for cross-border exchanges in electricity (OJ 2003 L 176, p. 1). Regulation No 1228/2003 was repealed and replaced by Regulation No 714/2009.
   (
         5
      )	See paragraph 5.2.1 of the Study supporting the Impact Assessment concerning Transmission Tariffs and Congestion Income Policies – Final Report, May 2017 (‘the 2017 Study’). That study is available on the website of the Commission’s Directorate-General for Energy.
   (
         6
      )	See Article 16(1) of Regulation No 714/2009.
   (
         7
      )	See paragraph 2.1 of Annex I to Regulation No 714/2009.
   (
         8
      )	See Schoser, C., ‘Chapter 8. The regulation on cross-border electricity exchanges: substantive rules’, in Jones, C. (ed.), EU Energy Law. Volume I: The Internal Energy Market, Claeys & Casteels, 2016 (paragraphs 8.45 and 8.63). See also Bernaerts, I., ‘Chapter 1. The third internal market package and its implications for electricity and gas infrastructure in the EU and beyond’, in Vinois, J.-A. (ed.), EU Energy Law. Volume VIII: The Energy Infrastructure Policy of the European Union, Claeys & Casteels, 2014 (paragraph 3.2.1).
   (
         9
      )	I should specify that the Court has not had the opportunity to rule on the interpretation of the corresponding provision of Regulation No 1228/2003, that is, Article 6(6) thereof.
   (
         10
      )	According to the EI’s report of 11 July 2014 entitled ‘Congestion revenues according to [Regulation No 714/2009]’ (‘the EI’s 2014 report on congestion revenues’).
   (
         11
      )	According to the EI’s report of 10 July 2015 entitled ‘Congestion revenues according to [Regulation No 714/2009]’ (‘the EI’s 2015 report on congestion revenues’).
   (
         12
      )	Article 2(44) of Commission Regulation (EU) 1222/2015 of 24 July 2015 establishing a guideline on capacity allocation and congestion management (OJ 2015 L 197, p. 24) defines ‘firmness’ as ‘a guarantee that cross-zonal capacity rights will remain unchanged and that a compensation is paid if they are nevertheless changed’. ‘Physical’ firmness refers to the first alternative, namely the right to physically transfer electricity through the interconnector (as opposed to the right to obtain financial compensation – in the amount of the price difference between the two zones – where there is no physical transfer of electricity).
   (
         13
      )	Judgment of 22 May 2008, citiworks (C‑439/06, EU:C:2008:298, paragraph 46).
   (
         14
      )	See Article 10 of Directive 2009/72.
   (
         15
      )	According to BCAB’s written observations.
   (
         16
      )	Judgment of the Bundesgerichtshof (Federal Court of Justice, Germany) of 7 May 2017 (EnVR 21/16) (DE:2017:070317BENVR21.16.0).
   (
         17
      )	I should mention that NRAs are required to notify to the Commission their decisions on the certification of TSOs, and that the Commission delivers an opinion on the compatibility of those decisions with, in particular, Article 9 of Directive 2009/72, which provides for unbundling obligations. The NRA concerned must take the utmost account of the Commission’s opinion (see Article 10(6) of Directive 2009/72 and Article 3 of Regulation No 714/2009). In the present case, the BNetzA notified to the Commission a negative draft decision on the certification of BCAB as a TSO. On 23 January 2014, the Commission issued an opinion whereby it stated that it agreed with the BNetzA that, first, ‘the Baltic Cable being a high voltage transmission line connecting the Swedish and the German transmission networks needs to be operated by an independent TSO in accordance with one of the unbundling models laid down in [Directive 2009/72]’, and, second, ‘[BCAB] at present cannot be certified as the operator of the Baltic Cable as it has not demonstrated that it complies with one of the unbundling models’ (Opinion pursuant to Article 3(1) of [Regulation No 714/2009] and Article 10 of [Directive 2009/72] – Baltic Cable AB, C(2014) 424) (‘the Commission’s opinion concerning the certification of BCAB’). I should note that that opinion indicates that ‘the Baltic Cable is owned and operated by Statkraft Energie AS, a vertically integrated energy undertaking with activities in the field of generation, transmission and supply of electricity’. That opinion is available on the website of the Commission’s Directorate-General for Energy.
   (
         18
      )	For the sake of clarity, I shall summarise in points 29 to 35 of this Opinion the observations submitted by the parties on the first and the second questions referred, as those questions are linked.
   (
         19
      )	I should specify that, although the Parliament and the Council submitted observations only on the fifth question referred, their position on the first and the second questions may be deduced from those observations.
   (
         20
      )	Judgment of 10 December 2018, Wightman and Others (C‑621/18, EU:C:2018:999, paragraph 47).
   (
         21
      )	See Article 2(2)(g) of Regulation No 714/2009. I should specify that Regulation No 1228/2003 came into force on 4 August 2003 (see Article 2(2)(g) and Article 15 of the latter regulation).
   (
         22
      )	See recital 1 of Regulation No 714/2009.
   (
         23
      )	See recital 23 of Regulation No 714/2009.
   (
         24
      )	According to the DG Competition Report on Energy Sector Inquiry, of 10 January 2007, ‘action is needed, wherever current capacity is insufficient, to develop interconnector capacity as a necessary condition for the development of competition and the integration of markets’ (see paragraph 1049 of that report, which is available on the website of the Commission’s Directorate-General for Competition). In 2014, the European Council called on Member States to achieve interconnection of 10 % of their production capacity by 2020 (Conclusions of the European Council of 23 and 24 October 2014, ‘2030 Climate and Energy Policy Framework’, point 4). Progress has been made as 17 Member States have achieved that target, and a new objective was set to arrive at a 15 % target by 2030 (Communication on strengthening Europe’s energy networks, of 23 November 2017, COM(2017) 718 final, point 4). In other words, there still is, as mentioned in point 3 above, urgent need for more interconnection capacity.
   (
         25
      )	Reference should be made, in that regard, to the 2017 Study (cited at footnote 5 above), which states as follows: ‘congestion revenues are scarcity rents. These rents are not a result of “normal” business operation, i.e. the result of the exploitation of the transmission grid, but these are accrued due to the lack of transmission capacity. Hence, this income has a special status and ring fencing or a special treatment is desirable (as already expressed by the European legislator)’ (p. 96).
   (
         26
      )	Which, as mentioned in footnote 4 above, was repealed and replaced by Regulation No 714/2009.
   (
         27
      )	See Article 6(7) of the position of the European Parliament adopted at first reading on 13 March 2002 with a view to the adoption of European Parliament and Council Regulation (EC) No…/2002 on conditions for access to the network for cross-border exchanges in electricity (‘the Parliament’s amendment’) (OJ 2003 C 47 E, p. 380). The Commission’s proposal (cited at footnote 4 above) did not provide for an exemption.
   (
         28
      )	See the justification for Amendment 18 in the Parliament’s Report on the proposal for a regulation of the European Parliament and of the Council on conditions for access to the network for cross-border exchanges in electricity, of 28 February 2002. That report is available on the website of the Parliament.
   (
         29
      )	See Knops, H., and De Jong, H., ‘Merchant Interconnectors in the European Electricity System’, Journal of Network Industries, 2005, No 4, pp. 261 to 291 (p. 262 and 263).
   (
         30
      )	See also p. 54 of the Explanatory Memorandum to the amended proposal for a regulation of the European Parliament and of the Council on conditions for access to the network for cross-border exchanges in electricity, submitted by the Commission on 7 June 2006 (COM(2002) 304 final).
   (
         31
      )	See point 40 above. That limitation on the scope of the exemption was introduced by the Council (see Council document of 18 September 2002, n 11915/02).
   (
         32
      )	Reference is made to points 29, 31, 32 and 35 above.
   (
         33
      )	Judgment of 22 May 2008, citiworks (C‑439/06, EU:C:2008:298, paragraph 46).
   (
         34
      )	Emphasis added.
   (
         35
      )	See paragraph 2.2 of the Commission staff working document - Accompanying the legislative package on the internal market for electricity and gas - Impact Assessment, of 19 September 2009 (SEC(2007) 1179).
   (
         36
      )	Although the Parliament submitted observations only on the fifth question referred, its position on the third and the fourth questions may be deduced from those observations.
   (
         37
      )	Regulation of the European Parliament and of the Council of 5 June 2019 on the internal market for electricity (OJ 2019 L 158, p. 54).
   (
         38
      )	See footnote 12 above.
   (
         39
      )	Cited at footnote 4 above.
   (
         40
      )	By way of example, reference may be made to Great Britain’s ‘cap and floor’ regime, which BCAB mentioned at the hearing. Under that regime, the developer of an interconnector cannot earn more than a maximum revenue (the ‘cap’), but it cannot earn less than a minimum revenue (the ‘floor’). Both cap and floor are set by Great Britain’s regulatory authority, namely the Office of Gas and Electricity Markets. Any revenue above the cap is transferred by the interconnector to the national TSO, namely National Grid Electricity Transmission plc, which in turn reduces network charges for the use of that system. Conversely, if the revenue earned by the interconnector falls below the floor, the difference is transferred to the interconnector by the TSO, which recovers these costs through increased charges paid by users of the transmission system. Between the cap and the floor, there is a band which allows the interconnector to retain congestion revenues and make a profit (see Niedospial, L., ‘Cap and Floor Regime: The New Approach to Electricity Interconnector Regulation in Great Britain’, in Roggenkamp, M., and Banet, C., (eds.), European Energy Law Report XI, Intersentia, 2017, pp. 165 to 190). A similar approach was adopted by the Belgian regulatory authority, namely the Commission de Régulation de l’Électricité et du Gaz (‘CREG’) (see pp. 32 to 37 and 80 to 84 of the Arrêté fixant la méthodologie tarifaire pour le réseau de transport d’électricité et pour les réseaux d’électricité ayant une fonction de transport pour la période régulatoire 2020-2030 [Decree fixing the tariff methodology for the electricity transmission system and for electricity system with a transmission function for the regulatory period 2020-2030], of 28 June 2018, (Z)1109/10, which is available on CREG’s website).
   (
         41
      )	See Article 17(1) of Regulation No 714/2009.
   (
         42
      )	See Article 18(3)(b) of Regulation No 714/2009.
   (
         43
      )	See Article 18(3)(d) of Regulation No 714/2009, which refers to Article 8(6)(c), (g) and (k) of that regulation.
   (
         44
      )	See recital 29 and Article 18(3) of Regulation No 714/2009.
   (
         45
      )	The ‘Offshore-Umlage’ is described in Commission decision on State Aid SA.49416 – Germany – Reductions of the offshore surcharge for electro-intensive undertakings and reductions on the CHP surcharge for electricity produced from waste gases, of 27 March 2018.
   (
         46
      )	I note that EU measures that are inconsistent with fundamental rights protected by the Charter are invalid. See judgments of 8 April 2014, Digital Rights Ireland and Others (C‑293/12 and C‑594/12, EU:C:2014:238), and of 6 October 2015, Schrems (C‑362/14, EU:C:2015:650). See also Lenaerts, K., and Gutiérrez‑Fons, J.A., ‘The Place of the Charter in the European Legal Space’, in Peers, S., Hervey, T., Kenner, J. and Ward, A. (eds.), The EU Charter of Fundamental Rights. A Commentary, Hart Publishing, second edition, 2020.
   (
         47
      )	Judgment of 11 January 2017, Spain v Council (C‑128/15, EU:C:2017:3, paragraph 71).
   (
         48
      )	Judgment of 8 June 2010, Vodafone and Others (C‑58/08, EU:C:2010:321, paragraph 52).
   (
         49
      )	Judgment of 21 May 2019, Commission v Hungary(Usufruct over agricultural land) (C‑235/17, EU:C:2019:432, paragraph 88).
   (
         50
      )	See, by analogy, judgment of 5 July 2017, Fries (C‑190/16, EU:C:2017:513, paragraph 37).