GRDF (Energy - internal market in natural gas - Abstract) [2019] EUECJ C-236/18 (19 December 2019)

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(Reference for a preliminary ruling — Common rules for the internal market in natural gas — Directive 2009/73/EC — Article 41(11) — Settlement of disputes concerning the obligations imposed on the system operator — Temporal effects of decisions of the dispute settlement authority — Legal certainty — Legitimate expectations)

1. Approximation of laws — Measures of approximation — Common rules for the internal market in natural gas — Directive 2009/73 — Scope — Conditions of access to the system imposed on natural gas suppliers by the operator of the distribution system — Contractual clause requiring suppliers to bear the risk of unpaid amounts relating to the amounts owed by the final customers by way of the tariff for distribution — Included

(European Parliament and Council Directive 2009/73, Arts 32(1), 41(1)(a) and (b), 10 and 11)

2. Approximation of laws — Measures of approximation — Common rules for the internal market in natural gas — Directive 2009/73 — Duty and competencies of the regulatory authority — Contracts for the transmission of gas between the operator of the distribution system and the suppliers — Contractual clause requiring suppliers to bear the risk of unpaid amounts relating to the amounts owed by the final customers by way of the tariff for distribution — Obligations imposed on the operator of the distribution system — Method of access to the system based on published tariffs, applied objectively and without discrimination between the users of the system — Regulatory authority acting as dispute settlement authority — Decision of the regulatory authority requiring compliance of the contract with the directive for the entire contractual period — Whether permissible — Infringement of the principles of legal certainty and the protection of legitimate expectations — None

(European Parliament and Council Directives 2003/55, Art. 33(1), and 2009/73, recitals 4, 6, 25 and 40 and Arts 1, 32(1), 41(1)(b), 10 and 11)

The Court rules on the temporal scope of decisions taken by national regulatory authorities in the context of their duty to settle disputes on the market in natural gas

In the judgment in GRDF (C‑236/18), delivered on 19 December 2019, the Court ruled on the temporal scope of the decision-making power conferred on the national regulatory authorities, in the context of their duty to settle disputes on the market in natural gas, by Article 41(11) of Directive 2009/73 concerning the internal market in natural gas. (1)

That case arises from a dispute between two natural gas suppliers and GRDF, the operator of the natural gas distribution system in France and concerning the validity of a clause in their contracts for the transmission of natural gas on the distribution system, concluded in 2005 and 2008. Under that clause, suppliers were required to collect, in the context of the contracts concluded with final customers, the amounts due by way of the GRDF tariff for the provision of gas distribution and to pay those amounts to those suppliers, including when final customers had not paid them. In 2014, a decision of the Dispute Resolution and Sanctions Committee of the Energy Regulatory Commission, ‘CRE’) found that the contracts were incompatible with the directive as from the date of their conclusion. As that decision was upheld on appeal, GRDF then brought an appeal before the Cour de Cassation (Court of Cassation), which decided to submit a request for a preliminary ruling to the Court of Justice for the purpose of determining, in essence, whether Directive 2009/73 precludes a decision of a regulatory authority from producing effects before the emergence of a dispute between the parties.

The Court of Justice confirmed that it had jurisdiction to reply to the request for a preliminary ruling, in so far as that request was based on the premiss that the obligation imposed on the gas suppliers by the system operator, constituting a condition for access to that system, was a practice incompatible with the provisions of Directive 2009/73.

On the substance, the Court has held that that directive does not preclude a regulatory authority, acting as a dispute settlement authority, from adopting a decision ordering the system operator to enter into a contract for the transmission of natural gas concluded with a supplier in accordance with EU law for the whole of the contractual period, including, therefore, for the period prior to the emergence of a dispute between the parties. In that regard, the Court first of all observed that Article 41(11) of Directive 2009/73 does not specify the temporal effects of decisions of the regulatory authority acting as the dispute settlement authority. Interpreting, next, that provision in the light of the objective and context of Directive 2009/73, the Court observed that, under Article 41(1)(b) of Directive 2009/73, the regulatory authority’s duty is to ensure that system operators comply with their obligations, including the obligation to apply the method of third-party access to the system objectively and without discrimination between system users. That entails an obligation on the part of the Member States to ensure that, by virtue of Article 41(10) of Directive 2009/73, the regulatory authority has the power to adopt binding decisions with regard to natural gas undertakings, requiring them to modify, if necessary, the terms and conditions for connection and access to the system, including tariffs, so that they are proportionate and applied in a non-discriminatory manner. To limit the temporal scope of a decision of the regulatory authority, acting as a dispute settlement authority, to the period subsequent to the emergence of the dispute between the parties, would run counter to the objectives of Directive 2009/73 and would undermine its effectiveness.

The Court has also held that that interpretation of Article 41(11) of Directive 2009/73 is not called into question either by the principle of legal certainty or by the principle of the protection of legitimate expectations. First, although a national court or tribunal may exceptionally be authorised, under the conditions laid down by the Court of Justice, to maintain certain effects of an annulled national measure, the referring court has not, in the present case, referred to specific evidence capable of establishing particular risks of legal uncertainty. Second, although GRDF claimed that the contracts for the transmission of gas at issue had been negotiated under the aegis and control of the CRE, it has not established that the CRE had been given precise assurances as to the conformity of the clause at issue, which it is, however, for the referring court to determine.

1 Directive 2009/73/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in natural gas and repealing Directive 2003/55/EC (OJ 2009 L 211, p. 94).

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You are here: BAILII >> Databases >> Court of Justice of the European Communities (including Court of First Instance Decisions) >> GRDF (Energy - internal market in natural gas - Abstract) [2019] EUECJ C-236/18 (19 December 2019) URL: http://www.bailii.org/eu/cases/EUECJ/2019/C23618.html Cite as: [2019] EUECJ C-236/18, EU:C:2019:1120, ECLI:EU:C:2019:1120

Court of Justice of the European Communities (including Court of First Instance Decisions)