by Jerome a Paris
Thu Aug 30th, 2007 at 05:28:02 AM EST
Russian energy faces EU barriers
In a confidential working paper, the Commission suggests a series of measures to restrict foreign companies’ access to the EU’s energy sector, and in particular the gas and electricity transmission networks.
A separate internal Commission document about the implications of unbundling, seen by FT Deutschland, the Financial Times’ sister paper, says the EU could be “vulnerable to a strategy of third countries to dominate the EU markets not only in terms of supply but also by acquiring the networks”.
The document explicitly warns about situations “where investment is driven by other motives than economic ones”.
Attempts by the EU to restrict acquisitions by non-European companies are likely to be vexatious. The European Commission has set itself firmly against attempts by member states such as Spain and France to declare their energy industries strategic sectors that can be protected from foreign bidders. However, it seems likely that some form of protection for the energy sector will be implemented.
Of course, the argument will be that markets work only with players that follow the rules, so a distinction can be made between insiders and outsiders. But they won't get away from the fact that they are explicitly admitting that there can be non-economic considerations given in the management of the energy sector and energy networks. Because what they are claiming is that there can only be negative economic outcomes from such meddling, and no positive outcomes. Except that they seem to acknowledge that there would be a positive impact form Russia. So why don't we have a policy that allows us to have such strategic benefits from market meddling? How can our strategy be "let's have no strategy, and let (European) corporations decide what is best for us" if energy is deemed so sensitive?