Today, with their publication of joint guidelines on the award of gas and electricity concessions and the transfer of network use, the Bundeskartellamt and Federal Network Agency have shown a further example of the good cooperation between the two agencies.

At the moment the award of electricity and gas concessions is a topic of key interest for many energy providers and municipalities. The guidelines, which have been jointly compiled by the two agencies, offer undertakings and municipalities an orientation guide to key issues in this area.

Electricity and gas concessions must be newly awarded every 20 years at the latest. Many of the estimated 20,000 concession contracts awarded across Germany are currently expiring or will expire in the coming years. At present a tendency towards remunicipalisation can be detected whereby local authorities increasingly award concessions to municipality owned utilities.

In awarding concessions, the municipality bears a special responsibility to ensure competition in the bidding process as well as in the end consumer markets.

The section of the guidelines dealing with competition law focuses in particular on the selection of companies by the respective municipality. Although public procurement law does not apply in this case, each municipality has a dominant position in the award of local public rights of way, which it is not allowed to abuse. A possible case of abuse is given, for example, if the municipality gives preference to individual bidders, especially to undertakings associated with the municipality, without any objective justification. The municipality also has to provide the network-relevant data necessary for an appropriate preparation of bids. It also acts abusively if it demands or accepts considerations in return, which are inconsistent with the Regulation on Concession Fees.

Andreas Mundt, President of the Bundeskartellamt, stated: "The municipalities must award the concessions in a transparent and non-discriminatory manner and guarantee that all bidders have equal chances. Otherwise they act abusively. Practitioners are not always aware of this. The guidelines are intended to help all parties involved to prevent any infringements of competition law."

The section of the guidelines referring to energy law deals primarily with the phase of transfer of network use in the event of change of a concession holder. An area of conflict which regularly arises between the former and new concession holder is whether a transfer of ownership of the network facilities is necessary or whether transfer of their usage by means of a lease agreement is sufficient.

For his part, the President of the Federal Network Agency, Matthias Kurth, stated: "With the guidelines we are helping former and new concession holders to interpret and implement existing energy regulations. The main aim is to ensure that in the event of the change of a concession holder the stipulated transfer of network use is not delayed or prevented by legal ambiguities."

The joint guidelines of the Bundeskartellamt and Federal Network Agency on the award of electricity and gas concessions and change of concession holder are published in German on the websites of the Bundeskartellamt and Federal Network Agency.