EFT News

Tuesday, January 12, 2016
Press release

St. Gallen, 12 January 2016

Yesterday, the Romanian Competition Council published on its website that it has levied fines in the amount of EUR 37 million to Hidroelectrica, and its 10 contractual partners among which Energy Financing Team (Switzerland) AG (EFT) for concluding anti-competitive agreements on the electricity producing and trading market in Romania. Even more confusingly the heaviest fines were issued to foreign companies including EFT.  EFT’s market share was never above 4%.

We are a Swiss based company, proud to be carrying out our business activities in compliance with good business practices and therefore have a good reputation all over Europe.  We perform our business in a professional manner and we have in-depth experience in our business field.  We were entering into long-term bilateral contracts on a commercial basis, ensuring that our practices globally comply with all applicable laws and market conditions.  We cannot be held responsible for eventual mistakes, failures and omissions of any of our counterparties, nor for mismanagement at those companies.

Moreover, the contracts we had with Hidroelectrica were already analysed and cleared by the European Commission from the perspective of State aid rules.  The European Commission found that “the contracts were either concluded on market terms or, where tariffs were below market level, that the Romanian state could not be held responsible for the tariffs granted. In particular, the analysis revealed that Hidroelectrica charged prices that were fully in line with the benchmark market price to nine customers (ArcelorMittal, Alro, Alpiq RomEnergie, Alpiq RomIndustries, EFT, Electrica, Electromagnetica, Energy Holding, Euro-Pec)” it said a press release of European Commission dated June 12th, 2015.

Romanian Competition Council has reached a contrasting conclusion although it analysed the same facts and should have applied the same principles and benchmarks as the European Commission.

We were not active on the Romanian internal market since 2012. Our long-term contracts with Hidroelectrica were unilaterally terminated by Hidroelectrica during its Judicial Reorganisation in 2012, causing EFT a loss of estimated EUR 80 MM. As Hidroelectrica has refused any amicable settlement, EFT was forced to initiate arbitration in Switzerland, in September 2014. So far the Arbitral Tribunal has rejected all objections filed by Hidroelectrica and passed the Award on Jurisdiction, after which the case will proceed in January 2016.

EFT will use all legal possibilities in Romania as well as Europe to defend its position against this unfair ruling and the very biased procedure.

Such clear breaches of EU Law unfortunately send a very clear and very negative message to all foreign business working or planning to work in Romania. 

Energy Financing Team (Switzerland) AG

Urs Jakob
Managing Director