EC antitrust officials raid oil company offices

MAY 14, 2013 — European antitrust authorities have raided the offices of several companies active in and providing services to the crude oil, refined oil products and biofuels sectors, including BP, Royal Dutch Shell, Norway’s Statoil and the pricing agency Platts.

The European Commission said that the “unannounced inspections” in two EU Member States. At the Commission’s request, inspections were also carried out on its behalf by the EFTA Surveillance Authority in one European Economic Area (EEA) Member State [Norway].

The Commission says it “has concerns that the companies may have colluded in reporting distorted prices to a Price Reporting Agency [Platts] to manipulate the published prices for a number of oil and biofuel products. Furthermore, the Commission has concerns that the companies may have prevented others from participating in the price assessment process, with a view to distorting published prices. Any such behavior, if established, may amount to violations of European antitrust rules that prohibit cartels and restrictive business practices and abuses of a dominant market position (Articles 101 and 102 of the Treaty on the Functioning of the EU and Articles 53 and 54 of the EEA Agreement).”

The Commission says that prices assessed and published by Price Reporting Agencies serve as benchmarks for trade in the physical and financial derivative markets for a number of commodity products in Europe and globally. Even small distortions of assessed prices may have a huge impact on the prices of crude oil, refined oil products and biofuels purchases and sales, potentially harming final consumers.

In the EU, Commission officials were accompanied by their counterparts from the relevant national competition authorities. In the EEA Member State, Commission officials accompanied their counterparts from the EFTA Surveillance Authority and from the national competition authority.

The Commission says the unannounced inspections are a preliminary step to investigate suspected anticompetitive practices. The fact that the Commission carries out such inspections does not mean that the companies are guilty of anti-competitive behavior nor does it prejudge the outcome of the investigation itself. The Commission respects the rights of defense, in particular the right of companies to be heard in antitrust proceedings.

There is no legal deadline to complete inquiries into anticompetitive conduct. Their duration depends on a number of factors, including the complexity of each case, the extent to which the companies concerned co-operate with the Commission and the exercise of the rights of defence.

Statoil (OSE:STL, NYSE:STO) issued the following statement:

Statoil’s (OSE:STL, NYSE:STO) office in Stavanger is today subject to an inspection visit by the EFTA Surveillance Authority (ESA), assisted by the Norwegian Competition Authority (Konkurransetilsynet). The inspection is carried out on request of the European Commission. Statoil is cooperating with the authorities in their inspection.

The authorities suspect participation by several companies, including Statoil, in anti-competitive agreements and/or concerted practices contrary to Article 53 of the EEA Agreement. In addition the inspection relates to potential abuse of possible dominant position by another party, contrary to Article 54 of the EEA Agreement.

The suspected violations are related to the Platts’ Market-On-Close (MOC) price assessment process, used to report prices in particular for crude oil, refined oil products and biofuels, and may have been on-going since 2002.