Through a recent decision, the High Court of Cassation and Justice confirmed that Romanian energy rules grant power distribution concessionaries monopoly rights in the areas entrusted to them under the concession agreements. This decision marks the end of a five-year long legal battle that menaced to change the power distribution market’s design.
In 2016, two companies from the Digi Communications group, a leading Romanian telecom provider (Delalina and Foto Distribuție), filed a claim with the Bucharest Court of Appeal seeking to obtain the right to provide power distribution services through parallel distribution networks in areas allocated to distribution concessionaries. The respondents included four other distribution companies, as well as several public authorities, among which the Romanian Government and the National Energy Regulator (ANRE).
The claimants challenged secondary legislation issued by ANRE granting concessionaries the right to oppose the entry of other distribution operators in the areas allotted to them. Essentially, the claimants argued that the concessionaries’ monopoly rights under the concession agreements would not find support in the primary energy legislation. For similar reasons, the claimants requested the annulment of the concession agreements.
In 2017, Digi Communications filed a plea of unconstitutionality against provisions in the Romanian Energy Law regulating the organisation and functioning of the distribution service, on the grounds that such provisions went against the constitutional principle of economic freedom. The plea of unconstitutionality was eventually dismissed by the Romanian Constitutional Court in 2020.
act Botezatu Estrade Partners team was coordinated by Ștefan Botezatu (Managing Partner) and Gabriela Olteanu (Counsel), alongside Cristian Radu (Managing Associate) and Daniela Goreacii (Senior Associate).
act Botezatu Estrade Partners is the Romanian office of act legal, a strong alliance with 400 professionals in offices located in 10 of the most important markets in continental Europe.
The strong client portfolio and the disputes team’s experience have been core strengths of the firm since its incorporation. The team is successfully handling high-stake mandates for local and international clients, in matters involving energy disputes, administrative litigation, civil law disputes, shareholder’s disputes, employment litigation, real estate litigation, as well as international and domestic arbitration.
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