A refusal to grant access to a grid within the provision of crude oil transfer services as an example of a prohibited abuse of a dominant position in the EU and Polish competition law

Abstract

Aim: The paper discusses cases in which a refusal by an energy enterprise to connect other enterprises to the network is treated as a prohibited abuse of the enterprise's dominant position and, equally, will represent behavior prohibited by art. 12 of the Treaty on the Functioning of the European Union and by art. 9 par. 2 item 2 of the Competition and Consumer Protection Law as well as legal consequences of such refusal. It is important to pinpoint such cases since the EU sectoral regulation does not provide for obligating any undertakings which manage and operate oil pipelines to enter into contracts with other undertakings such as contracts on connecting into their network or contracts on providing crude oil transfer services. Conditions for accessing oil pipelines and selling their transfer capacities are determined by the owners of the networks: private oil companies in the countries across which the pipelines are routed. These conditions are not governed by the EU law. Furthermore, the very obligation of connecting other entities to own network by energy undertakings operating in the oil transfer sector in Poland will only arise from generally applicable provisions of the Polish competition law. Design / Research methods: The purpose of the paper has been reached by conducting a doctrinal analysis of relevant provisions of Polish and EU law and an analysis of guidelines issued by the EU governing bodies. Furthermore, the research included the functional analysis method which analyses how law works in practice. Conclusions / findings: The deliberations show that a refusal to access the network will be a manifestation of a prohibited abuse of a dominant position and will be a prohibited action always when the dominant's action is harmful in terms of the allocation effectiveness. It will be particularly harmful when delivery of goods or services objectively required for effective competition on a lower level market, a discriminatory refusal which leads to elimination of an effective competition on the consequent market, a refusal leading to unfair treatment of consumers and an unjustified refusal. Originality / value of the article: The paper discusses the prerequisites which trigger the obligation to connect entities to own network by energy undertakings operating in the oil transfer sector. The obligation has a material impact on the operations of the oil transmitting undertakings, in particular on those who dominate the market. The regulatory bodies in the competition sector may classify a refusal of access to own network by other enterprises as a prohibited abuse of the dominant position, exposing such undertakings to financial consequences.Implications of the research: The research results presented in the paper may be used in decisions issued by the President of the OCCP and in judgement of Polish civil courts and EU courts. This may cause a significant change in the approach to classifying prohibited practices to prohibited behavior which represent abuse of the dominant position. The deliberations may also prompt the Polish and EU legislator to continue works on the legislation.