site.btaParliament Authorized Energy Regulator to Endorse Transactions for Significant Parts of Strategic Energy Companies

Sofia, April 26 (BTA) - Parliament Thursday authorized the energy regulator to endorse transactions with over 20 per cent of the capital of electricity, heating or gas distribution and transmission companies, to make sure the security of service, public order and national security are guaranteed. The powers of the regulator were broadened by emending the Energy Act.

The revision was proposed by the power-sharing United Patriots coalition amid a deal for sale of the Bulgarian power distribution business of Czech energy group CEZ.

The report for the conclusive vote on the revision did not include this text and that caused a dispute in the plenary hall on Wednesday. Socialist MP Tasko Ermenkov moved for adding the revision and GERB supported the motion. The opposition Movement for Rights and Freedoms were against.

The head of the parliamentary energy committee, Delyan Dobrev, explained that GERB were in favour of the revision and only had doubts that this was the best text they could have. "We give the regulator these powers but the legislation does not say clearly what criteria would be used when it is to decide whether or not to approve a deal," said Dobrev. He added that as the new legal provision is too broad, the regulator has too much leeway in making its decision - which can change with a bylaw.

Asked whether the new text in the law will allow the regulator to have a say in the CEZ deal with its prospective buyer, the obscure Pazardjik based company Inercom, Dobrev said this is a question to address to lawyers as the law will have to be applied retroactively.

He added, though, that his personal opinion is that the new text does not apply to the CEZ deal.

After the Energy Act was changed, the energy regulator will require of the owners of energy companies with a licence, to indicate in their annual reports any intention they may have for a spinoff, separation, merger or others with stock representing over 20 per cent of the capital of the company, or sale of part or all assets of the energy company.