1st May 2014

Competitiveness: Russia sues EU before WTO

On 30 April, Russia announced that it will file a formal complaint before the WTO against the EU. This will be Russia´s second complaint since the 2012 WTO entry. Russia is dissatisfied with the EU´s Third Energy Package adopted in 2009. One of its elements is the so-called ownership unbundling – a rule that a distribution pipe cannot be both owned and operated by a single company. This rule should lead to higher competition and consequently to lower prices on the market. Russia, however, argues that such rule is against the principles of non-discrimination and equal market access of the WTO, since only one company is allowed to export Russian gas from Russia, that is Gazprom. Also, the package should not be retroactive – contracts concluded before 2009 should not be affected by the Package, Russia says. Following the complaint, the two parties will have 60 days to come to an agreement and if they fail, the WTO will set up an arbitrage panel which will come with a binding ruling. Russia filed a complaint before the WTO in the past against EU levies on steel products. On the other hand, EU and several other WTO members have complained against Russia several times. Also, Gazprom is currently under European Commission´s investigation for possible anti-competitive behavior in certain Eastern EU Member States.

Members of the American Chamber of Commerce in the Czech Republic