November 25, 2016 / 2:11 PM / 3 years ago

UPDATE 2-EDF sites searched by French competition authorities

(Adds Engie comment, background on competition)

PARIS, Nov 25 (Reuters) - French electricity utility EDF’s headquarters and other sites have been searched by the competition authorities looking into a possible abuse of a dominant position in the energy market, the state-controlled utility said on Friday.

Investigators seized documents and EDF is cooperating with the inquiry which is at a preliminary stage, an EDF spokesman said.

Regulator Autorite de la Concurrence said it had conducted searches and seized documents at several companies suspected of having put in place anti-competitive practices in the energy sector. It declined to comment on the companies involved.

A decade after the country’s power market was opened to competition, 87 percent state-owned EDF still sells power under regulated tariffs to some 88 percent of French homes and small businesses, according to the industry regulator CRE.

Its smaller competitors complain that successive French governments have done little to stimulate more competition by informing the public about the possibility of switching to other suppliers.

In order to protect consumers’ purchasing power - and their electoral base - governments of both left and right have limited increases in EDF’s regulated tariffs, which are relatively cheap compared with rates in other EU countries. This has made it harder for alternative suppliers like Direct Energie to offer lower market rates.

Competitors say that EDF hardly covers its costs because of this, and have successfully sued to enforce retroactive catch-up price increases.

Leading gas supplier Engie said it was not concerned by the investigation.

In 2014 the antitrust watchdog ordered Engie to give competitors access to a part of its customer database and said the utility might have abused its dominant position in the gas market. But a year-long investigation did not lead to sanctions.

The antitrust body has the authority to impose penalties costing the equivalent of as much as 10 percent of a company’s worldwide sales.

EDF’s shares were down 0.5 percent at 10.05 euros in late afternoon trade. (Reporting by Geert De Clercq; Editing by Sudip Kar-Gupta)

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