Monday

23rd Oct 2017

EU lawyers give Russia pipeline a free pass

  • EU leaders switch on previous Russia-German pipeline, Nord Stream 1, in 2011 (Photo: nordstream.com)

Whether it is the legal service of the Quai d'Orsay in France, that of Her Majesty's foreign office in the UK, or that of the German foreign office, all government legal services recognise the need to maintain credibility.

In any opinions they provide to government, they understand they have to effectively address contrary arguments and understand the economic and political context in which they are asked for their input.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

  • Former German chancellor Schroeder now works as a Russian lobbyist (Photo: nord-stream2.com)

The leaked legal opinion of the EU Council's legal service, which examined the European Commission's proposed mandate in respect of Nord Stream 2, filed on 27 September, failed on both these counts.

Precedents

For example, the Council's service makes the argument that the EU's 2009 gas directive (part of the third energy package) cannot apply to export pipelines bringing fossil fuels into Union territory.

The legal service argues that Article 2(17) of the directive limits its application to a "transmission line which crosses … a border between member states for the sole purpose of connecting the national transmission systems of those states".

Whether one agrees or not with that argument, as a matter of fact the 2009 gas directive has been applied to export pipelines bringing natural gas into the Union.

The Commission has insisted that Poland applies the full liberalisation regime envisaged under the 2009 directive to the Yamal Pipeline.

That pipeline, like Nord Stream 2, is not a pipeline that connects two member states. Instead, it flows through two non-member states, Russia and Belarus, and then into Poland.

Equally, the Commission instituted infringement proceedings against Bulgaria for failing to apply the 2009 directive to the South Stream pipeline.

Again, the South Stream pipeline in landing on Bulgarian soil would not have provided a connection with another member state.

Instead it was a pipeline connecting Russia, a non-member state, via its territory and the exclusive economic zones of the Black Sea and into Bulgaria.

To provide a credible legal opinion, the Council's legal service would have to at least distinguish the Yamal and South Stream cases under EU law from Nord Stream 2.

Not only did the legal service fail to do this, neither Yamal nor South Stream are even mentioned in the text.

Recital 36

The Council service also failed to address contrary arguments in respect of the opinion of the Commission's energy department in 2016.

The Commission made a compelling argument that EU law applied to export pipelines.

Its opinion points out that Recital 36 of the EU statute, which provides for "the possibility of temporary derogations … for security of supply reasons, in particular, to new pipelines within the [EU] transporting gas from third countries into the [EU]".

It could, as a consequence of Recital 36, be argued that the EU legislature did not have the intention of excluding export pipelines from the scope of its jurisdiction.

Article 36

On top of this, one of the key arguments deployed by the legal service to deny that the 2009 statute can apply to export pipelines was to focus on Article 36.

Article 36 lists the type of projects that may be exempted from the full burden of the liberalisation regime contained in the statute.

The legal service argued that as export pipelines are not listed as being capable of an exemption, the statute was not intended to apply to them.

But this overlooks the argument made by the Commission's energy department that a number of language versions of the statute indicate that the types of project listed in Article 36 are illustrative only.

That would mean that other projects not explicitly listed in Article 36, such as Nord Stream 2, are capable of exemption. P

The Council's legal service did not address this argument at all.

Stunner

For Baltic and central and eastern European (CEE) governments, perhaps the most stunning part of the opinion is contained in paragraph 11 of the EU Council text.

Here, the legal service says that "the assumption that the opening of supplementary routes or capacities [with Nord Stream 2] might increase the Union's dependence on its external energy providers is, at the very least counter-intuitive".

This sentence would have some credibility if was an analysis from 1997, When the EU included only Western European states, not 2017.

In 1997, Western European states in the European Community had never seen their supplies of gas cut off by Russia, even at the height of Cold War tensions.

However, the same was not true of the Baltic countries and CEE states.

There were at least 40 Russian state inspired and politically motivated energy cut-offs between 1991 and 2004 targeted at states across the region.

There were even more since they joined the EU - in 2006, 2009, 2014 and 2015.

In this context Baltic and CEE states see the Yamal and Brotherhood pipelines as providing a degree of transit security - one cannot cut of the CEE states without cutting off states in Western Europe.

Nord Stream 2 would remove such transit security.

Transit security

The threat from Nord Stream 2, which the Council's legal service seem to be wholly unaware of, was highlighted by former German foreign minister Sigmar Gabriel's attempts to reassure CEE capitals.

In 2016, he tried to persuade a number of governments that all would be well with Nord Stream 2 because additional pipeline capacity could be built from west to east, with Germany supporting the onward supply of natural gas to the CEE states.

CEE governments pointed out to Berlin that the problem with the generous German offer was that it was an offer the Germans could not actually guarantee.

They pointed to the experience in 2014 and 2015 when Gazprom cut gas supplies to CEE states in an attempt to stop gas being moved from west to east in a reverse flow to support Ukraine.

Berlin was met with the rejoinder: "If they can do it to Kiev, they could do it to us".

Alan Riley is a law professor at City University in London

Focus

Indoor air quality on EU building agenda for first time

MEPs will debate amendments to new EU building regulations next week, intended to improve energy efficiency but which could also see indoor air quality become a mandatory criteria for the first time.

News in Brief

  1. May: EU member states will not lose out with Brexit
  2. Slovakia pledges to be 'pro-European' oasis in region
  3. Report: Catalan leader to address Spanish senate
  4. Fiat-Chrysler 'obstructed justice' reports Le Monde
  5. EU presidency 'confident' on posted workers agreement
  6. Young conservatives boot out Erdogan's party
  7. Tsipras urged to let refugees go before winter sets in
  8. Thousands demand justice in Malta

Stakeholders' Highlights

  1. Martens CentreI Say Europe, You Say...? Interview With EU Commission VP Jyrki Katainen
  2. Mission of China to the EUPresident Xi Jinping Proposes Stronger Global Security Governance at Interpol Assembly
  3. European Friends of ArmeniaEU Engagement Could Contribute to Lasting Peace in Nagorno-Karabakh
  4. UNICEFViolence in Myanmar Driving 12,000 Rohingya Refugee Children Into Bangladesh Every Week
  5. European Jewish CongressBulgaria Applauded for Adopting the Working Definition of Antisemitism
  6. EU2017EENorth Korea Leaves Europe No Choice, Says Estonian Foreign Minister Sven Mikser
  7. Mission of China to the EUZhang Ming Appointed New Ambassador of the Mission of China to the EU
  8. International Partnership for Human RightsEU Should Seek Concrete Commitments From Azerbaijan at Human Rights Dialogue
  9. European Jewish CongressEJC Calls for New Austrian Government to Exclude Extremist Freedom Party
  10. CES - Silicones EuropeIn Healthcare, Silicones Are the Frontrunner. And That's a Good Thing!
  11. EU2017EEEuropean Space Week 2017 in Tallinn from November 3-9. Register Now!
  12. European Entrepreneurs CEA-PMEMobiliseSME Exchange Programme Open Doors for 400 Companies Across Europe

Stakeholders' Highlights

  1. CECEE-Privacy Regulation – Hands off M2M Communication!
  2. ILGA-EuropeHealth4LGBTI: Reducing Health Inequalities Experienced by LGBTI People
  3. EU2017EEEHealth: A Tool for More Equal Health
  4. Mission of China to the EUChina-EU Tourism a Key Driver for Job Creation and Enhanced Competitiveness
  5. CECENon-Harmonised Homologation of Mobile Machinery Costs € 90 Million per Year
  6. ILGA-EuropeMass Detention of Azeri LGBTI People - the LGBTI Community Urgently Needs Your Support
  7. European Free AllianceCatalans Have Won the Right to Have an Independent State
  8. ECR GroupBrexit: Delaying the Start of Negotiations Is Not a Solution
  9. EU2017EEPM Ratas in Poland: "We Enjoy the Fruits of European Cooperation Thanks to Solidarity"
  10. Mission of China to the EUChina and UK Discuss Deepening of Global Comprehensive Strategic Partnership
  11. European Healthy Lifestyle AllianceEHLA Joins Commissioners Navracsics, Andriukaitis and Hogan at EU Week of Sport
  12. Nordic Council of MinistersNordic Council Representative Office Opens in Brussels to Foster Better Cooperation