©AFP

Brussels is to seek sweeping new powers to vet gas contracts between Russia and EU countries before they are signed, ramping up its efforts to curb the influence of Gazprom, Moscow’s gas export monopoly.

The European Commission is concerned that Moscow has abused its dominant position as a supplier of 30 per cent of Europe’s gas to force illegal clauses into supply contracts with eastern European states, some of which are almost 100 per cent dependent on Gazprom.

In response, the commission will next month propose that three or four of its officials should clear all governmental energy accords with non-EU states in advance — a power-grab by Brussels that diplomats say is likely to trigger resistance from larger EU states. The oversight of gas deals is highly sensitive and was the subject of heated debate between EU leaders last March.

According to early draft documents seen by the Financial Times, the commission wants EU states “to submit their draft intergovernmental agreements to the commission for ex ante assessment”. This would “enhance the proper functioning of the internal market and enhance the EU’s energy security”, it added.

The commission’s proposals have been informed partly by the EU’s experience with the $50bn South Stream gas pipeline, which Gazprom had planned to build under the Black Sea into central Europe.

The scheme collapsed at the end of 2014 after Brussels concluded that it contravened EU competition laws that prevent Gazprom and other gas suppliers from also controlling distribution. One of the commission’s biggest challenges in that case was the fact that Russia had already built a tight contractual framework for South Stream by signing intergovernmental agreements with the eastern European states on the proposed pipeline’s route.

Powers to preapprove gas deals would represent a significant change because countries now notify Brussels about such deals only after they have been signed. The reform would require approval from member states and the European Parliament.

Diplomats say that Germany, the EU’s most influential member state, is wary of radical changes to the current system. The UK is more supportive. A British official said: “This is something we are broadly in favour of, and have been pushing the commission to do.”

The commission said that EU states had reported 124 intergovernmental gas agreements since late 2012 and that 15 of them appeared to be incompatible with EU law. It is seeking to clear deals in advance because it found it almost impossible to terminate or revise those 15 disputed agreements.

One of the EU’s main objections to Russian contracts are clauses forbidding the resale of gas. Brussels argues that this infringes open competition and creates a gas market segmented upon national lines. Moscow has sometimes relied on these clauses to argue that EU states should not send lifeline gas supplies back into Ukraine, in so-called reverse flows.

Inter-governmental agreements are often used to lay the groundwork for a proposed pipeline project, and help give more assurance to potential investors about a binding governmental commitment to the venture.

EU officials describe the action on governmental agreements as only “one piece of the puzzle” because they are not universally used. Moscow’s plans to exports more gas to Germany through the contentious Nord Stream 2 pipeline, for example, are not underpinned by inter-governmental agreements.

Meanwhile, Poland has called for the commission to also take a stronger role in the oversight of purely commercial gas contracts between Gazprom and private companies.

Brussels has so far shied away from such an approach. The commission will instead propose that it — and member states — should be able to assess commercial supply contracts immediately after they are signed.

But, in order to allay fears in western Europe, it said this condition should only apply when contracts between the buyer and supplier represented a dominant 40 per cent of the national market — as is often the case with Russian gas deals.