June 29, 2016 / 3:03 PM / 2 years ago

UPDATE 1-EU wants Bulgaria to sell gas network operator or face hefty fine - PM

(Adds Commission comments, details)

By Tsvetelia Tsolova

SOFIA, June 29 (Reuters) - EU antitrust regulators have told Bulgaria it should sell its state-owned gas network operator Bulgartransgaz or face fines of up to 300 million euros ($333 million), Bulgarian Prime Minister Boiko Borisov said on Wednesday.

Speaking to reporters in Brussels, Borisov said such a sanction would be unacceptable to Bulgaria.

Last year the European Commission charged state-owned Bulgarian Energy Holding, the owner of Bulgartransgaz, with breaching EU antitrust rules by hindering competitors’ access to key gas infrastructure in Bulgaria.

“When (EU Competition) Commissioner Margrethe Vestager comes and says that you need to sell Bulgartransgaz, for us this is a heavy political blow ... Otherwise an infringement procedure of up to 300 million euros follows,” Borisov said in an audio file, sent by the government press office.

Borisov said Deputy Prime Minister Tomislav Donchev met European Commission President Jean-Claude Juncker’s team to try to settle the issue.

Commission spokesman Ricardo Cardoso said that the antitrust investigation was ongoing and that there was no decision yet.

“As is common practice in antitrust investigations, Commissioner Vestager has met with Bulgarian counterparts to discuss the state of play of the investigation,” he said.

BEH and its subsidiaries, Bulgartransgaz and Bulgagaz, own or control the domestic Bulgarian gas transmission network, the only gas storage facility in Bulgaria and the capacity on the main gas import pipeline into Bulgaria.

At present Bulgartransgaz transports only gas from Russia’s Gazprom for domestic use and to neigbouring Greece, Macedonia and Turkey.

Bulgaria, which is almost completely dependent on Russian gas supplies, is building gas interconnection links with Greece and Romania to diversify its gas providers and is hoping to become a regional gas hub.

In a similar case, Gazprom has offered concessions to avoid a fine after the Commission accused it of overcharging customers and blocking rivals in eastern and central Europe. ($1 = 0.9002 euros) (Reporting by Tsvetelia Tsolova, additional reporting by Foo Yun Chee in Brussels, editing by Louise Heavens/Keith Weir)

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