Gazprom wins appeal against huge Nord Stream 2 antitrust fine in Poland

Russia’s Gazprom has won an appeal against a fine of over €6 billion imposed on it by Poland’s antitrust authority, UOKiK, for constructing the Nord Stream 2 gas pipeline without first seeking Polish approval. UOKiK now says that it plans to challenge the ruling.

In October 2020, UOKiK imposed financial penalties of more than 29 billion zloty (€6.2 billion) on Gazprom and more than 234 million zloty (€49.7 million) on five other European entities involved in the Nord Stream 2 project. It was reported to be the world’s largest ever competition fine.

The Nord Stream 2 pipeline – which Poland strongly opposed – was supposed to bring Russian gas to Germany but in fact never began operation due to Russia’s aggression against Ukraine this year. It, as well as the Nord Stream 1 pipeline, was recently damaged by explosions in the Baltic Sea.

According to UOKiK, in 2018 Gazprom entered into an agreement with the five other companies (Germany’s Wintershall and Uniper, France’s Engie, Austria’s OMV and the UK’s Shell) without the prior consent of the Polish regulator, which may have led to a restriction of competition in the market.

UOKiK also says that the partners started financing the project without forming a joint venture and through loans, which is a violation of antitrust laws.

It imposed a penalty equivalent to approximately 70% of the cost of the project, and equal to funds contributed to the project by Gazprom and the five other companies.

Gazprom, however, disputed UOKiK’s decision and filed an appeal with Poland’s Court of Competition and Consumer Protection in November 2020.

“The UOKiK decision violates the principles of legality, proportionality and fair trial, and the unprecedented amount of the fine testifies to the desire to oppose the implementation of the Nord Stream 2 project by any means,” the Russian firm told Politico Europe at the time.

Yesterday, the Polish court ruled in Gazprom’s favour, announced UOKiK in a statement.

The court found that “it is beyond the competence of [UOKiK] to assess the effects on the economy and whether they [the actors involved in the construction of Nord Stream 2] tried to circumvent the law”, said UOKiK’s head Tomasz Chróstny.

“We are surprised by the judgment,” he added. “We will ask for a written justification of the verdict and then we will file an appeal in this case.”

“Today, the dangers of which we spoke when we presented the decision are visible to the naked eye not only in Poland but throughout Europe. Recognising these dangers at the time, we took action, according to our competencies, to stop this project,” noted Chróstny.

Main image credit: Thawt Hawthje/Flickr (under CC BY 2.0)

Alicja Ptak

Alicja Ptak is senior editor at Notes from Poland and a multimedia journalist. She previously worked for Reuters.