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French consumer fraud watchdog DGCCRF has searched the offices of energy companies, including those of giants Eni and Engie, as part of an anti-competition probe into France’s retail electricity and gas market, Reuters reported on Monday.
DGCCRF said in a statement today that 73 of its agents had carried out on June 27 simultaneous raids at the premises of 13 companies, two energy firms and 11 subcontracting companies, without revealing the name of any of the companies involved.
France’s Engie confirmed that it was under investigation by the DGCCRF watchdog, a unit of the French finance ministry, and would fully cooperate, while Eni told Reuters that it had no immediate comment on the issue.
The DGCCRF consumer fraud regulator said that it had been receiving for months complaints from customers that energy firms were using misleading practices in signing up customers and persuading them to switch their supplier without their explicit informed agreement.
The goal of the searches carried out last week is to determine whether these reported practices are isolated occurrences or a deliberate anti-competitive practice of energy suppliers, the DGCCRF said in its statement.
If such practices are found and proved, they would be an offense of misleading commercial practices, punishable by French law with a penalty of up to 10 percent of a company’s annual revenue, the watchdog said.
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According to Reuters, France’s state-controlled electricity firm EDF is losing retail customers to competitors and has complained about unfair practices used by its rivals to make them switch suppliers.
The French electricity and natural gas markets were fully liberalized and opened to competition on July 1, 2007. Since then, consumers in France have been free to choose their retail energy provider, EDF or suppliers other than the state-controlled company known as “alternative” suppliers. Consumers can choose between two types of offers—prices set freely by suppliers, or regulated sale tariff set by the French government and proposed by EDF and local distribution companies. As of June 30, 2018, a total of 78 percent of residential and non-residential sites were paying the regulated tariff, and 22 percent were paying market rates, according to the French Energy Regulatory Commission.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.