Belgium’s federal energy regulator, CREG, filed a petition before the Constitutional Court seeking partial setting-aside of the Act of 8 January 2012 amending the Electricity Act and Gas Act in implementation of the Third European Package of energy regulations (Directive 2009/72/EC and Directive 2009/73/EC). In its judgment 117/2013 of 7 August 2013, the Constitutional Court set aside a limited number of sections of the transposing statute but threw out the lion’s share of the regulator’s pleas.
The regulator’s petition to set aside the transposing statute was very extensive. It struck at tens of sections and subsections of the amended Electricity and Gas Acts. CREG’s petition was the final offensive in a tussle between the regulator and the executive and legislature, which had already been brewing in the wings for some time regarding the scope of the independent regulator’s powers as laid down in EU law.
In short, the petition was structured on five big themes: (i) organisation and rules of good governance of the regulator; (ii) grid tariffs ; (iii) appeals available against decisions by the regulator; (iv) unbundling rules and certification procedure and (v) closed industrial networks.
As regards organisation, the Constitutional Court found in favour of the CREG on the argument that the “General Board”, a consultative body with representatives from the sector, employers, employees, environmental bodies, etc., cannot form part of the CREG without affecting its independence. In addition, the Court confirmed that the principles of good governance are applicable to the CREG. Inter alia, it held that the duty on the CREG to state its grounds in the case of requests for information and the ability of businesses to make remarks before the CREG took decisions, did not constitute impermissible incursions into the regulator’s independence, contrary to what CREG had argued.
As regards the powers of the regulator in approving grid tariffs, the Court upheld the transposing statute, which provided for (sometimes very detailed) “general policy guidance” for exercise by the regulator of its powers. The CREG’s argument that a large part of this guidance and its detailed nature constituted an incursion into its powers was therefore held to be fallacious.
The Court also entirely upheld the rules concerning judicial review of CREG decisions. It emphasised that the European guidelines regarding regulator independence point to the fact that independent judicial review is correlative to the regulator’s independence.
In the matter of unbundling requirements of TSO's, the Court found in favour of the CREG in holding that the prohibition against multiple directorships concerned not only natural persons, but all persons, i.e. including legal persons. A number of the regulator’s pleas regarding the certification procedure of TSO's, including the fact that the designated TSO “is automatically deemed certified”, were nonetheless rejected by the Court.
Finally, the Constitutional Court dealt with the regulator’s pleas concerning the definition and impact of closed industrial networks. It found for the CREG on the plea that domestic consumers cannot be excluded from the consumers that can be served by a closed industrial network on the basis of article 28(4) of Directive 2009/72/EC. The Court also set aside the provision allowing supplies to consumers not established in the location. However, the Court did retain the possibility of regarding the traction network of the railway infrastructure as a closed industrial network.
