EUROPEAN COMMISSION Brussels, XXX Z[(2015) XXX draft COMP Special handling STATEMENT OF OBJECTIONS of XXX relating to a proceeding under Article 102 of the Treaty on the Functioning of the European Union and Article 54 of the EEA Agreement Case AT.39816 k Upstream Gas Supplies in Central and Eastern Europe (Only the English text is authentic) EN EN TABLE OF CONTENTS 1. Introduction................................................................................................................ 11 2. Procedure.................................................................................................................... 12 3. The party concerned by the Statement of Objections ................................................ 14 3.1. The addressees of the Statement of Objections.......................................................... 14 3.1.1. Description of OAO Gazprom ................................................................................... 14 3.1.2. Description of Gazprom Export................................................................................. 16 3.2. F^wmoljp criiv `lkqoliiba bkqfqfbp il`^qba fk Drolmb .............................................. 16 3.2.1. Gazprom Germania .................................................................................................... 16 3.2.2. Gazprom Marketing and Trading............................................................................... 17 3.2.3. Others ......................................................................................................................... 17 3.3. Gazprom's joint ventures in Europe........................................................................... 17 3.3.1. Bulgaria Overgas Inc............................................................................................... 17 3.3.2. Germany Wingas and WIEH .................................................................................. 17 3.3.3. Hungary O^korpdxw Fxwhbobphbabijf Yoq- 'O^korpd^w(....................................... 18 3.3.4. Poland Europol........................................................................................................ 18 3.3.5. Switzerland WIEE................................................................................................... 19 3.3.6. CEE F^wmoljp ltkbopefm fk telibp^ibop............................................................. 19 4. Cbp`ofmqflk lc F^wmoljp j^fk `lkqo^`q m^oqkbop clo qeb rmpqob^j prmmiv lc d^p fk the CEE ...................................................................................................................... 19 4.1. Bulgaria Bulgargaz.................................................................................................. 19 4.2. Czech Republic - RWE Transgas............................................................................... 20 4.3. Estonia Eesti Gaas................................................................................................... 20 4.4. Hungary EFT and Centrex Hungary ....................................................................... 20 4.4.1. EFT............................................................................................................................. 20 4.4.2. Centrex Hungxof^ Qq- 'Bbkqobu Grkd^ov( ............................................................... 20 4.5. Latvia - Latvijas Gaze ................................................................................................ 21 4.6. Lithuania Wholesalers Lietuvos Dujos, Dujotekana and Haupas and industrial customer Achema....................................................................................................... 21 4.7. Poland PGNiG......................................................................................................... 22 4.8. Slovakia - SPP............................................................................................................ 22 5. The product: natural gas............................................................................................. 22 5.1. Natural gas ................................................................................................................. 22 5.2. The gas supply chain.................................................................................................. 23 5.3. Gas infrastructure....................................................................................................... 24 5.3.1. Transport .................................................................................................................... 24 EN 2 EN 5.3.2. Storage and other sources of flexibility ..................................................................... 24 6. The CEE gas markets................................................................................................. 25 6.1. Demand ...................................................................................................................... 25 6.2. Supply ........................................................................................................................ 26 6.3. Consumption .............................................................................................................. 27 6.4. Infrastructure.............................................................................................................. 27 6.4.1. Pipelines ..................................................................................................................... 27 6.4.2. Reverse flows............................................................................................................. 29 6.4.3. LNG terminals............................................................................................................ 30 6.4.4. Cross-border interconnections ................................................................................... 31 6.4.5. Storage........................................................................................................................ 32 7. Description of Gazprom's main gas supply contracts with CEE wholesalers and industrial customers ................................................................................................... 32 7.1. Introduction................................................................................................................ 32 7.1.1. The three Baltic countries supply contracts with OAO Gazprom........................... 32 7.1.1.1. Estonia........................................................................................................................ 33 7.1.1.2. Latvia.......................................................................................................................... 33 7.1.1.3. Lithuania .................................................................................................................... 33 7.1.2. The other five CEE countries supply contracts with Gazprom Export................... 33 7.1.2.1. The Czech Republic ................................................................................................... 34 7.1.2.2. Poland......................................................................................................................... 34 7.1.2.3. Slovakia...................................................................................................................... 34 7.1.2.4. Bulgaria...................................................................................................................... 35 7.1.2.5. Hungary...................................................................................................................... 43 7.2. Overview of typical clauses of a gas supply contract ................................................ 48 7.2.1. Clauses on contractual quantities............................................................................... 48 7.2.2. Clauses on delivery period/duration and points of delivery....................................... 48 7.2.3. Clauses on take-or-pay obligations ............................................................................ 49 7.2.4. Penalty clauses ........................................................................................................... 50 7.2.5. Clauses setting the price formulae ............................................................................. 50 7.2.6. Price revision clauses ................................................................................................. 52 7.2.7. Arbitration clauses ..................................................................................................... 54 7.2.8. Hardship clauses......................................................................................................... 56 7.2.9. Territorial restriction clauses...................................................................................... 56 8. F^wmoljp mlif`v lc j^ohbq pbdjbkq^qflk ................................................................ 56 8.1. F^wmoljp pqo^qbdv ql m^oqfqflk j^ohbqp ^ilkd k^qflk^i _loabop ............................... 57 EN 3 EN 8.2. Territorial restrictions in the form of contractual export bans or destination clauses in all eight CEE countries............................................................................................... 59 8.2.1. The territorial restrictions in gas supply contracts in CEE countries......................... 59 8.2.1.1. Bulgaria.....................................................................................................................