Central Europe Energy Partners’ (CEEP) position paper for public consultation on the review of the blocking statute (Council Regulation (EC) No. 2271/96)

Central Europe Energy Partners’ (CEEP) position paper for public consultation on the review of the blocking statute  (Council Regulation (EC) No. 2271/96)

We welcome the possibility to take part in the ongoing discussions and to comment on the review of the blocking statute. The EU should have effective tools to protect its interests and the EU operators against effects of the extra-territorial sanctions. Use of these tools, however, should be prudent as it may lead to escalation of conflict with a third country and may cause serious economic and political consequences. In this regard we are convinced that any firm counteraction to extra‑territorial sanctions has to be supported unanimously by the Council.

The EU should act on the international scene in accordance with the Treaty on European Union, which underlines the role of the EU in building cooperation in the world, solutions driven approach and promoting free trade. Article 3 para 5 TEU states inter alia that the EU ‘shall contribute to peace, security, the sustainable development of the Earth, solidarity and mutual respect among peoples, free and fair trade’. Additionally, Article 21 para 1 reads ‘(t)he Union shall seek to develop relations and build partnerships with third countries, and international, regional or global organisations which share the principles referred to in the first subparagraph. It shall promote multilateral solutions to common problems, in particular in the framework of the United Nations’.

The reform of blocking statute will not have a decisive effect on third countries' willingness to use extra-territorial sanctions, as this tool does not apply to the EU operators exclusively. At the same time there is no clear evidence, that the reform will successfully deter coercive actions. Therefore, the EU should focus on pursuing reform of the World Trade Organization (WTO). The WTO has provided a stable and predictable trading environment, allowing for a massive expansion of global trade, whilst providing a framework for settling trade disputes through adjudication. It is key for the EU to find like-minded global partners to restore a fully functioning WTO dispute settlement with a reformed Appellate Body.

Any revision of the EU legislation should take into account possible impact on the EU efforts to build international environment based on consensus, and on the EU relations with third countries that share the EU values. Such an approach should prevail over measures that could worsen the relations and contribute to deepening divisions in the global economy. The benefits of revision remain unclear – we cannot be sure, that it will minimize the negative effects of extra-territorial application of sanctions – therefore the EU has to carefully assess potential costs when designing tools that can lead to escalation of international tensions.