Brussels, 04/11/2014 (Agence Europe) - On Tuesday 4 November, the Commission called for clarification from Hungary regarding the new law adopted by the Hungarian parliament that seeks to speed up the construction of pipelines, such as the South Stream gas pipeline. This law was adopted on 3 November, with the support of the Hungarian Prime Minister Viktor Orban's Fidesz Party. It will allow companies to build gas pipelines without having to have separate authorisation permits.
On Tuesday, a Commission spokesperson, Anna Kaisa Itkonen, commented, “The EC is in contact with the Hungarian authorities in order to seek for further clarifications on this. It is the EC's understanding that the planned amendment of the law is proposed in the context of ensuring the building of the South Stream pipeline”. Separate authorization procedures for building and operating pipelines is not contrary to the provisions of the EU gas directive but this authorization has to be based on objective and non-discriminatory criteria which are published and made transparent. Itkonen explained, however, that the new Hungarian law does not provide any criteria for obtaining these licences. She added that, “In any event, it is crucial that in granting a licence to an undertaking to build a pipeline which normally takes place after commitment to book capacity have been made the strict provisions of the directive are not prejudiced as well as any public procurement rules”.
The Commission has been blocking construction of the South Stream gas pipeline in the EU for several months now because it considers that the project does not respect EU legislation on the internal market. In June, the European Commission opened infringement procedure against Bulgaria, targeting its procedure for awarding public contracts in the context of the South Stream section of work on Bulgarian territory.
The project is headed by the Russian gas company, Gazprom (50%), with a 20% share held by the Italian firm ENI, 15% by the French company, EDF, and the German Wintershall company, 15%. The South Stream project will link up Russia and Bulgaria under the Black Sea by circumventing Ukraine to supply the EU via two branches: one in the south, towards Italy, through Greece and the other, towards Austria, Croatia and Slovenia, by going through Serbia and Hungary. (EH)