Business

Poland fines Russia's Gazprom $7.6 billion over pipeline

Posted October 7, 2020 7:48 a.m. EDT
Updated October 7, 2020 7:49 a.m. EDT

Russian President Vladimir Putin, left, listens to Russian gas monopoly Gazprom Head, Alexei Miller during their meeting in Moscow, Russia, Wednesday, Sept. 16, 2020. (Mikhail Klimentyev, Sputnik, Kremlin Pool Photo via AP)

— Polish antitrust authorities have fined Russia's state-owned energy giant Gazprom $7.6 billion (6.5 billion euros) for building the Nord Stream 2 gas pipeline to Germany, saying the project hurts Polish consumers and increases Europe’s dependence on Russian imports.

Gazprom said it will appeal the decision.

Poland's Office of Competition and Consumer Protection on Wednesday also fined five other international companies participating in the project a total of $61 million (52 million euros). It said they failed to obtain its mandatory permission to jointly build and finance the pipeline, saying that violated antitrust laws.

The decision obliges the six companies to cancel their contracts for financing the project.

“Carrying out the project is tantamount to breaking the rules of law and of fair competition that will lead to an increased dependence of gas recipients on the internal market from one supplier - Gazprom,” the antitrust office said.

It added the situation may lead to “serious consequences for Poland's and the EU's economy," by limiting the range of supplies and increase gas prices for consumers, the office said.

Poland is strongly opposed to the pipeline, seeing it as a politically-motivated project. The pipeline is in its final stages of construction and is due to transport Russian natural gas across the Baltic Sea bed to Germany and western Europe, bypassing traditional transit routes through Ukraine and Poland.

Germany supports it, saying it is purely a business project, but has recently hinted it may reconsider.

The other companies fined are French Engie Energy, Austrian OMV, British-Dutch Shell, and Germany's Uniper and Wintershall.

The fines are the maximum allowed, equivalent to 10% of the companies' annual revenue.

An appeal would suspend the implementation of the decision until the court's ruling.

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