Acquisitions in the Gas Sector: the Impact of Sector Regulation
International Business Law Journal
From a regulatory standpoint, the issue of acquiring companies in the European natural gas sector cannot be examined in a uniform way since the assets held, and the activities carried out by the target company, vary considerably from one gas operator to another, depending on their position in the different segments of the gas chain (upstream, midstream, downstream). The ratification of the Third Energy Package (comprising the Third Gas Directive) by the European authorities in September 2009, has strenghened the need, for the purchaser, to not only identify the activities carried out by the target company but also to compare these with its own activities. This serves the two objectives of analysing: (i) whether the target company complies with the sector-specific regulations that apply to the different activities in the gas chain (exploration-production, treatment, storage, transmission, supply, trading); and (ii) if the contemplated transaction might require preliminary steps to be taken in order to ensure that the transaction complies with the applicable regulations of the sector (more particularly if one of the parties to the transaction qualifies as a "vertically integrated" operator).