Nord Stream 2 AG v European Parliament and Council of the European Union Case T-526/19 - Order of the General Court - Eighth Chamber of 20 May 2020
Order of the General Court (Eighth Chamber) of 20 May 2020.
Nord Stream 2 AG v European Parliament and Council of the European Union.
Action for annulment - Energy - Internal market in natural gas - Directive (EU) 2019/692 - Application of Directive 2009/73/EC to gas lines to or from third countries - No direct concern - Inadmissibility - Production of documents obtained unlawfully.
Background to the dispute
1 Directive 2003/55/ EC of the European Parliament and of the Council of 26 June 2003 concerning common rules for the internal market in natural gas and repealing Directive 98/30/EC (OJ 2003 L 176, p. 57) was repealed and replaced by Directive 2009/73/EC of the European Parliament and of the Council of 13 July 2009 (OJ 2009 L 211, p. 94).
2 Directive 2009/73 is intended to introduce common rules concerning the transmission, distribution, supply and storage of natural gas in order to facilitate access to the market and encourage fair and non-discriminatory competition. In that regard, that directive lays down, inter alia, an obligation to unbundle transmission systems and transmission system operators and provides for the introduction of a system of non-discriminatory third-party access to gas transmission and distribution systems on the basis of published tariffs.
3 Under Article 36 of Directive 2009/73, major new gas infrastructure, namely interconnectors, liquefied natural gas facilities and storage facilities, may, upon request and under certain conditions, be exempted, for a defined period of time, from some of the obligations laid down by that directive. In order to benefit from that exemption it must inter alia be shown that the investment will enhance competition in gas supply and enhance security of supply and that the level of risk attached to the investment is such that that investment would not take place unless an exemption was granted.
4 The applicant, Nord Stream 2 AG, is a company incorporated under Swiss law whose sole shareholder is the Russian public joint stock company Gazprom. It is responsible for the planning, construction and operation of the Nord Stream 2 pipeline, 50% of whose funding, which amounts to EUR 9.5 billion, is provided by the companies ENGIE SA (France), OMV AG (Austria), Royal Dutch Shell plc (Netherlands and United Kingdom), Uniper SE (Germany) and Wintershall Dea GmbH (Germany). Like the Nord Stream (now commonly known as Nord Stream 1) pipeline, which consists of a system of two lines, construction of which was completed in 2012 and which was to be operated for a period of 50 years, the Nord Stream 2 pipeline, also consisting of two gas transmission lines, will ensure the flow of gas between Vyborg (Russia) and Lubmin (Germany), near Greifswald (Germany), bringing the overall transport capacity of the Nord Stream 1 and Nord Stream 2 pipelines to 55 billion cubic metres per year. Once it reaches the German territory, the gas conveyed by Nord Stream 1 is transferred into the onshore pipelines NEL and OPAL, which are subject, under the supervision of the German regulatory authority, to the obligations of Directive 2009/73, while that conveyed by Nord Stream 2 is to be transported by the onshore pipeline ENEL and by the newly constructed onshore pipeline EUGAL, both of which are also regulated in Germany pursuant to Directive 2009/73.
5 In January 2017, works began to recover, in concrete, pipes intended for use as part of the Nord Stream 2 pipeline, final delivery of which was to take place in September 2018.
6 On 17 April 2019, acting on European Commission Proposal COM(2017) 660 final of 8 November 2017 ('the proposal for a directive'), the European Parliament and the Council of the European Union adopted Directive (EU) 2019/692 amending Directive 2009/73 concerning common rules for the internal market in natural gas (OJ 2019 L 117, p. 1) ('the contested directive'), which entered into force on the 20th day following that of its publication, that is, 23 May 2019. On that date, according to the statements made by the applicant, works to recover, in concrete, the Nord Stream 2 pipes were 95% complete, while 610 km and 432 km, respectively, of the two lines of the pipeline had been laid at the bottom of the territorial sea and/or the exclusive economic zone (EEZ) of Germany, Finland, Russia and Sweden. However, at the time the present action was brought, the applicant was yet to obtain authorisation from the Danish authorities concerning the route for the two Nord Stream 2 lines. That authorisation was, however, issued on 30 October 2019.
7 According to recital 3 of the contested directive, that directive seeks to address obstacles to the completion of the internal market in natural gas which result from the non-application, to date, of EU market rules to gas transmission lines to and from third countries.
8 In that regard, Article 2(17) of Directive 2009/73, as amended by the contested directive, provides that the concept of an 'interconnector' covers not only '[any] transmission line which crosses or spans a border between Member States for the purpose of connecting the national transmission system of those Member States', but also, now, '[any] transmission line between a Member State and a third country up to the territory of the Member States or the territorial sea of that Member State'.
9 However, under Article 49a(1) of Directive 2009/73, as added by the contested directive, 'in respect of gas transmission lines between a Member State and a third country completed before 23 May 2019, the Member State where the first connection point of such a transmission line with [that] Member State's network is located may decide to derogate from [certain provisions of Directive 2009/73] for the sections of such gas transmission line located in its territory and territorial sea, for objective reasons such as to enable the recovery of the investment made or for reasons of security of supply, provided that the derogation would not be detrimental to competition on or the effective functioning of the internal market in natural gas, or to security of supply in the Union'. That provision also states, first, that, derogations of this kind are to be 'limited in time up to 20 years based on objective justification, renewable if justified and may be subject to conditions which contribute to the achievement of the above conditions', and, second, that 'such derogations shall not apply to transmission lines between a Member State and a third country which has the obligation to transpose [Directive 2009/73, as amended, into] its legal order under an agreement concluded with the Union'.
10 Furthermore, the contested directive amended Article 36 of Directive 2009/73 by providing, in point (e) of paragraph 1 of that article, that the exemption granted under that provision to new infrastructure must not be detrimental to, inter alia, 'security of supply of natural gas in the Union'.
11 Regarding the implementation of the amendments made to Directive 2009/73 by the contested directive, Article 2 of the contested directive provides that, except for those which have no geographical borders with third countries and no transmission lines with third countries and, as a result of their geographical situation, Cyprus and Malta, 'Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with [that directive] by 24 February 2020, without prejudice to any derogation pursuant to Article 49a of [Directive 2009/73]'.