Changes to the energy law in France will affect companies located in the UK trading electricity over the interconnector with France. Some of them will need to take steps quickly to comply with new administrative requirements to file a declaration. Sanctions for non-compliance can be severe.
Under previous legislation, only companies “located” in France and intending to carry out an electricity trading activity had to file a declaration with the Ministry of Energy. While the term “located” was not defined, its was generally accepted that a trader with neither an office nor employees in France was not required to file a declaration.
Under a new energy law adopted in France, on 13 July 2005, it is now compulsory for any company intending to carry out an electricity trading activity to supply eligible customers in France to file a declaration, wherever that trading company is located.
This declaration consists of information about the company, its corporate and financial standing, its sources of electricity and its compliance with other requirements of French electricity law such as transmission access contracts.
Once the company has filed a declaration and the Ministry does not object to the company carrying out the trading activity, it will obtain a receipt entitling it to trade for a five-year period. The new law includes a variety of sanctions for breach including being denied access to the network, administrative and economic sanctions.
The legislation does not provide for any grace period for compliance with this new obligation, which has immediate effect. The French Ministry of Energy may provide an informal grace period, but given that the potential sanctions in the case of non-compliance are significant, affected companies should seek to file a declaration as soon as possible.
