13 November 2017 / article

Gas Directive to include gas pipelines to and from third countries

On 8 November 2017, the Commission presented its proposal to update Directive 2009/73/EC (the “Gas Directive”).

Proposal

The proposal:

1) extends the scope of the Gas Directive to gas pipelines to and from third countries; and

2) allows Member States to grant cross-border pipelines certain derogations from the application of the Directive.

While EU law in general applies in the territorial waters and the EEZ of EU Member States, the current Gas Directive does not explicitly set out a legal framework for gas pipelines to and from third countries. There is however a practice of applying core principles of the Gas Directive in relation to third countries, notably via international agreements concerning gas pipelines entering the European Union. Therefore, according to the European Commission, legislative action is required to define the regulatory framework applicable to all gas pipelines to and from third countries. With the proposed amendments, the Gas Directive in its entirety will become applicable to pipelines to and from third countries, including existing and future pipelines, up to the border of EU jurisdiction. This includes the respective provisions on third-party access, tariff regulation, ownership unbundling and transparency.

Pipelines

However, to take account of the previous lack of specific Union rules applicable to gas pipelines to and from third countries, the Commission proposes to allow Member States to grant cross-border pipelines certain derogations from the application of the Directive. The proposal enables new pipelines to and from third countries to apply for an exemption from the above rules pursuant to Article 36 of the Gas Directive. As regards existing pipelines, which fall outside the scope of Article 36, Member States will be enabled to grant certain derogations from the application of the Directive on a case-by-case basis, as long as such derogations are not detrimental for competition or security of supply.

The proposed amendments must be agreed by the European Parliament and Council before they become law. We will keep you informed of any new developments in this respect.

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