Case ECS-08/11S: Bosnia and Herzegovina / gas

summary of the case

On 24 October 2013 the Ministerial Council adopted Decision 2013/04/MC-EnC in Case ECS-08/11 establishing a breach of Energy Community law by declaring that Bosnia and Herzegovina, failed to comply with certain obligations under the Treaty related to the transposition of Directive 2003/55/EC. Bosnia and Herzegovina was required to rectify until June 2014 the breaches established in Article 1 of the Decision 2013/04/MC-EnC.

Since Bosnia and Herzegovina did not take any measures to rectify the breaches, on 18 July 2014 the Secretariat initiated Case ECS-08/11S by submitting a Reasoned Request to the Ministerial Council under Article 92 of the Treaty.

By Decision 2014/04/MC-EnC in Case ECS-08/11S of 23 September 2014, the Ministerial Council of the Energy Community established a serious and persistent breach by Bosnia and Herzegovina within the meaning of Article 92(1) of the Treaty. The Ministerial Council also ordered Bosnia and Herzegovina to adopt legislation compliant with Directive 2009/73/EC and Regulation (EC) 715/2009 and to present it to the Ministerial Council at its next meeting, and it requested the Secretariat to offer assistance.

Despite the Secretariat providing all the necessary assistance, in drafting a Third Energy Package-compliant Gas Law and numerous meetings and working groups, no tangible results were achieved.

On 16 October 2015 the Ministerial Council adopted Decision 2015/10/MC-EnC declaring that Bosnia and Herzegovina had failed to rectify the serious and persistent breaches identified in Decisions 2013/04/MC-EnC and 2014/04/MC-EnC and adopted several measures under Article 92 of the Treaty. The measures consisted in suspending the right of Bosnia and Herzegovina to participate in votes for Measures and Procedural Acts adopted under Chapter VI of Title V of the Treaty and to suspension of the application of the Reimbursement Rules to the representatives of Bosnia and Herzegovina for all meetings organized by the Energy Community. Moreover, the European Union, in line with Article 6 of the Treaty, was invited to take the appropriate measures for the suspension of financial support for projects in the gas sector in Bosnia and Herzegovina. The effect of the measures under Article 92 was limited to one year upon its adoption. Based on a report by the Secretariat, the Ministerial Council had to review the effectiveness and the need for maintaining these measures at its next meeting in 2016.

After continuous efforts and mediations of the Secretariat, on 13 October 2016, the Minister of Foreign Trade and Economic Relation of Bosnia and Herzegovina, the Ministers of the entities, and the Director of the Energy Community Secretariat, in the presence of Director General for Energy at the European Commission, signed an “Agreement on Removal of Serious and Persistent Breach under the Energy Community Treaty in the gas sector” by which Bosnia and Herzegovina recognized the obligation to rectify the serious and persistent breaches, as well as to transpose the Energy Community gas acquis in its entire territory.

On 14 October 2016, the Ministerial Council adopted Decision 2016/16/MC-EnC stating that Bosnia and Herzegovina had failed to rectify the serious and persistent breaches identified in Decisions 2013/04/MC-EnC, 2014/04/MC-EnC. Due the commitments taken by Bosnia and Herzegovina by signing the Agreement, the Ministerial Council decided to suspend the effects of the measures until 31 March 2017.

In the aftermath of Decision 2016/16/MC-EnC, the Secretariat reminded Bosnia and Herzegovina several times of its obligations and recalled the necessary implementation measures in order to rectify the breach.

Due to failure to implement the Agreement within the deadlines, the measures adopted under Decision 2015/10/MC-EnC took effect again after 31 March 2017, until the meeting of the Ministerial Council in December 2017.

Since Bosnia and Herzegovina did not take any measures to rectify the breaches, on 12 October 2017, the Secretariat submitted a Reasoned Request to the Ministerial Council under Article 92 of the Treaty requesting extension of the measures.