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* Fine is highest ever imposed by the Lithuanian watchdog
* Gazprom is Lithuania's sole supplier of natural gas
* Company also faces EU competition investigation
VILNIUS, June 10 Lithuania's competition
authority has fined Russia's Gazprom a record 123
million Lithuanian litas ($48 million), saying that the company
had prevented competition in the Baltic state.
Gazprom, the world's top gas producer and supplier of about
30 percent of Europe's gas needs, is also facing a European
Union investigation over suspected anti-competitive behaviour,
including overcharging customers and blocking rival
The company, Lithuania's sole natural gas supplier, breached
competition rules when it refused to negotiate a deal on gas
exchange with Lithuanian power producer Lietuvos Energijos
Gamyba in 2012, the Competition Council said in a
The power producer, a part of Lithuania state-owned energy
group Lietuvos Energija, had negotiated a deal with an
unidentified seller in Western Europe to buy gas from 2013 to
2015. But because the physical delivery was not possible,
Lietuvos Energijos Gamyba asked Gazprom to exchange the gas the
Lithuanian company planned to buy in Western Europe for volumes
the Russian company delivers to Lithuania via Belarus.
Gazprom, however, refused to enter negotiations on such a
deal, prompting the Lithuanian company to file a complaint with
the competition authority in July 2012.
It meant that Lithuanian consumers had to pay more for
electricity and heat generated by burning more expensive Russian
gas, the Competition Council said.
Gazprom's actions were in breach of its obligation not to
prevent customers from seeking alternative suppliers when the
Russian company bought 37.1 percent of Lithuania's gas supplier
Lietuvos Dujos a decade ago, the Council added.
The 123.1 million lita fine is the biggest ever issued by
the competition authority, the watchdog's spokeswoman said.
Lithuanian state-owned companies last month offered to buy
Gazprom's stakes in the country's gas utility Lietuvos Dujos and
gas transmission company Amber Grid.
Under European Union gas market rules designed to ensure
fair competition, companies that supply energy are not allowed
to dominate ownership of the infrastructure.
Gazprom, which is due to hold a board meeting on Wednesday
to decide on its shares in Amber Grid and Lietuvos Dujos,
declined to comment on the fine.
The competition authority also said that Gazprom refused to
provide it with required information, citing the decision of
Russia's President Vladimir Putin to ban strategic companies
from sharing information with foreign regulators.
($1 = 2.5495 Lithuanian Litas)
(Reporting by Nerijus Adomaitis; Editing by David Goodman)