Demand for PPC to sell its lignite units retracted

The European Union?s General Court decided on Thursday to annul the European Commission?s decisions concerning Greek lignite, securing a major victory for Public Power Corporation that had sought recourse to the tribunal.

The decision means that the electricity company is not liable for its monopoly on the production of coal power in Greece and will no longer be forced to sell its lignite units.

The original Commission decision in March 2008 had stated that Greek regulations conceding PPC exclusive rights to the use of Greek lignite created an inequality in opportunities among investors interested in accessing lignite as primary fuel for the production of electricity. According to Brussels, the concession of those rights secured PPC a dominant position in the wholesale electricity market in Greece and excluded potential newcomers. The second decision in August 2009 imposed measures to deal with the issues identified by the 2008 decision.

The main reason for the annulment of the decisions yesterday, according to a statement by PPC, was that the Commission failed to prove that the energy giant abused its dominant position in the lignite market, the Luxembourg-based court ruled. Therefore there has been no violation of the competition rules and there is no need for remedy measures, such as the sale of lignite plants to private investors.

The court added in its verdict that there may be a problem in the accessing of lignite by other power enterprises, but that it is the state that is responsible for this situation and not PPC, as the state should have issued utilization permits.

Development Ministry sources qualified the decision as particularly favorable in the government?s effort to apply a modern and efficient model to rationalize and open up the energy market.

The verdict was also greeted positively by PPC employee unions.

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