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SORGENIA/A2A; SORGENIA/ACEA; SORGENIA/ITALGAS


PRESS RELEASE



PRESS RELEASE

ELECTRICITY AND GAS: ANTITRUST AUTHORITY LAUNCHES THREE INVESTIGATIONS INTO A2A, ACEA AND ITALGAS OVER POSSIBLE ABUSE OF A DOMINANT  POSITION

Moves in response to several complaints lodged by Sorgenia. Obstruction alleged when customers want to change supplier or obtain measurement data in the liberalized markets for gas and electricity, to possible detriment of end customers who may not be able to choose the most cost-effective offer

The Italian Competition Authority, at its meeting on 29 April 2009, decided to launch three separate investigations into a number of leading distributors of gas and electricity (Italgas, Acea Distribuzione, A2A Reti Gas aand A2A Reti Elettriche) and their respective parent companies (ENI, ACEA and A2A), to determine whether these distributors abused their dominant position in their respective markets by way of conduct likely to hinder the ability of new entrants to compete in selling gas and electricity to domestic users and small businesses. The measures were  notified today in the course of a number of inspections carried out in conjunction with the Special Units of the Guardia di Finanza (Fiscal Police).

The investigations were prompted by a series of complaints lodged by Sorgenia in which that company claims the three industrial groups, by way of their distribution companies, assumed a consistently obstructionist and dilatory attitude in the procedures necessary for allowing customers to move to suppliers competing with their own subsidiaries in the sale of gas and electricity, thus hindering their entry into the liberalized markets and weakening their competitive positioning and capability. This is said to have allowed the sales arms of the integrated groups to retain their historic market shares in the local markets where the distributors operate.

This conduct, as far as Italgas is concerned, is alleged to have taken place in the municipalities where it distributes gas (Rome, Venice, Naples and Palermo, as well as many other municipalities throughout Italy), representing about 26% of all the gas distributed in Italy.

As far as ACEA is concerned, the conduct is alleged to have taken place in the distribution of electricity in the City of Rome, which alone accounts for 3.6% of the electricity consumed in Italy.

As for A2A, the alleged conduct is said to have involved the distribution of electricity and gas in Milan, Brescia and various municipalities in Lombardy, as well as the distribution of gas in various municipalities in Abruzzo, Campania and Calabria, representing overall about 7% of the gas distributed in Italy and around 4% of national electricity consumption.

In the Authority's view, such conduct, if confirmed, would have the effect of denying or limiting the possibility of end users to choose their own supplier and obtain gas and electricity at prices lower than the regulated ones, to their detriment, thus negating the goals of the whole liberalization process.
 

Rome, 6 May 2009