Lithuanian antitrust panel: compensation for gas overpayment may qualify as state aid

“In our preliminary view, based on the data available, it wouldn’t qualify as public resources and wouldn’t qualify as state aid. However, we should point out that there is a possibility, albeit small, that the European Commission may qualify it as state aid,” Šarūnas Keserauskas , chairman of Lithuania’s Competition Council, told BNS.

The draft decision, approved in principle by the government on Monday, stipulates that Lietuvos Dujos (Lithuanian Gas), a natural gas company indirectly controlled by the state, will compensate heat and electricity producers as well as other industrial users for the approximately 280 million litas (EUR 81.16m) they overpaid for gas in 2015 and 2016.

According to the Competition Council, if a discount for gas were granted to a gas supplier, it would most probably not qualify as state aid. However, it might qualify as such if a state-owned company were to sell gas at a below-market price.

Lietuvos Dujos has recently said that its non-household users, which overpaid for Gazprom’s gas during a year and a half, will be compensated with approximately 280 million litas in gas discounts they will be granted over the course of two years.

Late in September, the government, taking into account the comments made by the Competition Council, decided to tax shale gas production in Lithuania at a 1-percent rate in the first three years, instead of previously proposed zero rate, so as to avoid long-lasting approximation procedures with the European Commission.