This week ANRE, the Romanian energy regulator, fined four firms for REMIT violations associated with wash trading.
ANRE’s enforcement (click here - the document is in Romanian) will undoubtedly come as a shock to European wholesale energy markets as it is individually and collectively the largest enforcement action by monetary value issued by a National Regulatory Authority (NRA) for REMIT violations.
Since the first enforcement action in 2015, total REMIT enforcement fines amounted to € 220.7 million in aggregate thus the ANRE fines represent roughly 48.9% of the total fines issued. For further details on historic REMIT enforcement decisions since 2015, ACER provides a detailed table with hyperlinks to each decision (click here).
The ANRE enforcement decision does not provide significant detail however below are case facts that can be gleaned from the brief four page press release:
- The companies executed 'A to B to A' wash trades related to the same electricity product, for the same volume, at different price levels, between January and February 2021 which gave, or were likely to give, false or misleading signals as to the supply of, demand for, or price of wholesale energy products (as per the REMIT Article 2 (2)(a)(i) definition);
- Transactions were carried out on the OPCOM (the operator of the Romanian Electricity and Natural Gas market) Centralised Market for Continuous Double Trading of Bilateral Electricity Contracts (CM-OTC);
According to other sources the design of the Romanian power market retail price capping mechanism would mean that anti-competitive activities would also likely have resulted in damages to public finances (rather than to consumers) which might explain the unusually harsh penalties.
The four firms were fined as follows:
- Tinmar Energy S.A.: RON 363,982,051.85 (approx. € 73.12 million);
- Nova Power & Gas S.R.L.: RON 100,106,676.12 (approx. € 20.11 million);
- EFT Furnizare S.R.L.: RON 50,497,126.22 (approx. € 10.15 million); and
- Freepoint Commodities Europe LLP: RON 22,917,465.30 (€. EUR 4.6 million).
Both Tinmar Energy and Freepoint Commodities have appealed the decision (according to ACER’s overview of REMIT sanctions) while EFT and Nova Power are able to appeal but have not appealed as of the date of the enforcement announcement.
