By using its dominant market position, Polskie Górnictwo Naftowe i Gazownictwo (PGNiG) could have hindered its contracting parties dissolving a contract in case of changing the seller. However, the President of UOKiK resigned from imposing a fine as undertaking itself commited to change the practice

Polskie Górnictwo Naftowe i Gazownictwo owns approximately 98 percent of share on the retail natural gas market in Poland. The proceedings against the company were instituted in July 2011. The clauses applied in contracts of one of most powerful gas suppliers in Poland raised doubts of the Office as they hinder some contracting parties (mainly large industrial recepients) withdrawal from the fuel supply contract in case of changing the seller. According to these provisions, filing a statement regarding contract withdrawal after 30^th September of a given year results in dissolving the contract at the end of subsequent year at the earliest. Such long terms of notice, even up to 15 months, may discourage business partners of the company to resign from the contract and choose services rendered by other entities. Thus the company can abuse its dominant market position and hinder the commercial activity of its competitors. Due to the fact the practice of PGNiG affected the trade between the EU Member States, the undertaking might have breached also the community law.

During the investigation, PGNiG commited to change the contested practice. Consequently, the President of the Office issued a decision obliging the undertaking to fulfil specific commitments. In new agreements, Polskie Górnictwo Naftowe i Gazownictwo will have to shorten the contract term of notice (whenever a party intends to change the gas seller) till the end of a subsequent month after which the contract withdrawal statement was filed (e.g. when a recepient resigns form the contract in July, then the agreement is binding till the end of August). Furthermore, the company will be obliged to propose its customers new draft contracts in line with newly established terms and conditions. PGNiG will have three months to introduce new contracts and present annexes to them.

During the investigation, PGNiG commited to change the contested practice. Consequently, the President of the Office issued a decision obliging the undertaking to fulfil specific commitments. In new agreements, Polskie Górnictwo Naftowe i Gazownictwo will have to shorten the contract term of notice till the end of a subsequent month after which the contract withdrawal statement was filed 

Imposing the commitment on PGNiG resulted in shortening the time of conducting proceedings and will facilitate the efficient elimination of irregularities. Moreover, it will cause the liberalization of natural gas market by enhanced mobility of the fuel recipients.

PGNiG will have to submit a report concerning the stage of fulfilling the commitment – a month following introducing changes to the contracts the entity will present to UOKiK two counterparts of new standard forms of agreements, the new draft contract, a list of all recipients who were proposed the changed contract as well as these entities which were not presented the draft annexes along with statement of reasons for the practice. Additionally, till the end of January 2013, PGNiG will have to provide information either on recipients who changed the contract or on parties who denied accepting the annex.

After the lapse of deadlines, UOKiK will control if the decisions were properly executed by Polskie Górnictwo Naftowe i Gazownictwo. In the case of failing to fulfil the commitment, the undertaking can be punished with a fine up to EUR 10 thousand per each day of delay.

The decision is not final. The undertaking can appeal to the court.

This is not the only action of UOKiK undertaken against the practice of PGNiG. Currently, there is pending antimonopoly proceedings concerning the wholesale of natural gas by this dominant undertaking.

For more information on competition-restricting practices, please follow the campaign carried out by the Office of Competition and Consumer Protection.

Additional information for the media:
Małgorzata Cieloch, Spokesperson for UOKiK
Department of International Relations and Communication
Pl. Powstańców Warszawy 1, 00-950 Warszawa
Phone: +48 22 55 60 106
Fax: +48 22 826 11 86
E-mail: [SCODE]bWFsZ29yemF0YS5jaWVsb2NoQHVva2lrLmdvdi5wbA==[ECODE]