20 August 2002 – The UK Trade and Industry Department confirmed Monday that it had asked the European Commission to investigate the merger of German power firms E.ON and Ruhrgas which it believes will slow the progress to market liberalization in the energy sector.
Brian Wilson, UK energy minister, has asked Loyola De Palacio, the vice president for energy and transportation at the European Commission, to investigate if there were any tools to safeguard competition in the European energy markets.
The commission has previously said it could not intervene on the ground that it is within Germany’s jurisdiction and there is insufficient impact outside of the home country.
The proposed merger has drawn much criticism, including a request for action by UK gas group Centrica who fear an adverse impact on the European energy markets and legal action by TXU, the American power company.
Last Thursday the German government moved to circumvent a block on the merger and said it would hold a new hearing into it. Last month German State Secretary Alfred Tacke approved the take-over on behalf of the government.
Competitors have challenged the deal in the German courts and some opponents have said that E.ON’s recent purchase of Britain’s Powergen might give the planned merged firm sufficient breath to warrant an EU probe.