Competition fines Naturgy with 5 million for restricting competition in the installation of electric meters
The National Markets and Competition Commission (CNMC) has fined 5.08 million UFD Distribución Electricidad, the electrical distributor of the Naturgy Group, for restricting competition in the market for the installation of certain electrical measurement equipment -electric meters- between May 2018 and May 2021, the agency reported.
Specifically, the CNMC sanctions UFD with this amount for a very serious violation of the article 2 of Law 15/2007, on the Defense of Competition (LDC) and article 102 of the Treaty on the Functioning of the European Union (TFEU).
The investigation began following a complaint from Axon Time and Enerlin Ingenieros against the Naturgy electricity distributor for possible practices contrary to competition regulations. In April 2023, the CNMC carried out inspections at two headquarters of the Naturgy group and in November of that year he initiated sanctioning proceedings against UFD.
The regulator noted that “competition law requires that companies in a dominant position be especially responsible for not restricting competition either in the market they dominate or in related markets” and stressed that, specifically, “Carrying out actions without regulatory protection that have the capacity to produce exclusion effects will be abusive.regardless of the intentionality of the conduct.”
In this specific case, the body chaired by Cani Fernández indicated that UFD improperly interpreted that the obligation to integrate all the meters in the domestic segment into the distributor’s remote management systems was Also applicable to certain types of meters in the industrial segment (type 3 and 4).
Thus, he stated that this conduct resulted in the imposition of requirements not provided for in the regulations and in the denial or delay in installation and activation of measurement equipment owned by other measurement service companies and industrial clients.
However, he indicated that, although the company internally corrected this interpretation in May 2021, “with its practices it restricted competition and the choice of consumers and alternative operators”.
Sources from the company consulted stressed that, as the CNMC points out, they have already proceeded to correct the erroneous interpretation that was made of the regulations.
No public contracts for four months
Along with the fine, UFD will be prohibited from contracting with the public sector throughout the national territory for a period of four months. The ban affects contracts for works, supplies and services linked to the market for the installation of electrical measurement equipment and its making available at low voltage supply points affected by the conduct, except when the Naturgy electricity distributor is obliged to do so according to sector regulations.
Likewise, the CNMC imposes compliance and information obligations, such as activating telemetry equipment owned by third parties already installed and allow the installation and activation of new ones when requested by the client.
Likewise, UFD must allow the installation of electrical measurement equipment covered by regulations and inform the owners of the affected supply points and publish the new obligations on its website.
Against this resolution, The company may directly file a contentious-administrative appeal. before the National Court within a period of two months from the day following its notification.
