Press Release

White & Case Brings Successful End to Bulgarian Energy Holding Antitrust Probe

Global law firm White & Case LLP has represented Bulgarian Energy Holding (BEH), bringing an end to a European Commission antitrust probe, AT.39767 - BEH Electricity, without a finding of an infringement. After constructive negotiations, lasting a number of months, the Commission accepted the creation of the first independent power exchange in Bulgaria as a suitable basis for a commitment decision, pursuant to Article 9 of Regulation 1/2003.

"We are pleased to have played a role in such a positive, forward-looking development for the Bulgarian electricity market," said White & Case partner Mark Powell, who led the team. "This is a major step forward for electricity consumers in the region."

In August 2014, the Commission issued a Statement of Objections against BEH for alleged abuse of a dominant position as a result of certain provisions in the contracts of three BEH power generators for the sale of electricity on the free market. In addition to challenging the Commission's objections, alleging that these provisions were so-called "destination clauses", BEH entered into commitment discussions with the Commission and offered to establish the first-ever power exchange in Bulgaria and provide liquidity for its day-ahead platform with electricity volumes coming from BEH's power generators.

As well as setting up a power exchange in Bulgaria, BEH has offered to obtain the assistance of an independent third party with expertise in the operation of power exchanges. BEH's power generators will offer predetermined volumes of electricity on the day-ahead market sold on an anonymous basis for a period of five years. BEH will also transfer control of the power exchange to the Bulgarian Ministry of Finance.

The power exchange will significantly improve transparency on the unregulated wholesale electricity market in Bulgaria and further integrate the Bulgarian wholesale electricity market with those of neighbouring markets.

The initial commitment proposal by BEH was submitted to the Commission in May 2015, and it was market-tested in June 2015. The final commitment proposal by BEH, which addressed the comments from the market, was sent to the Commission in October 2015.

The White & Case Brussels team consisted of partners Mark Powell and Kai Struckmann, and associate Irina Trichkovska.

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