A spokesman for the European Commission (EC) yesterday rejected accusations that French EC Vice-President Stephane Sejourne was promoting French interests in earlier comments about the contract to build the planned Dukovany nuclear power plant units in the Czech Republic.
The tender was won last year by the Korean company KHNP, who were chosen over the French company EDF. Earlier this month, Sejourne wrote a letter to Czech Industry and Trade Minister Lukas Vlcek asking the Czech Republic to postpone the signing of a contract to build two new nuclear units at the Dukovany plant. The EU executive is now investigating whether KHNP received foreign subsidies that could distort the EU’s internal market.
The signing of the final agreement on Dukovany was also subsequently blocked by the Regional Court in Brno, which issued an interim measure based on a lawsuit filed by EDF, which challenged the decision of the Czech antitrust office (UOHS) that the tender was in order. The court has not yet ruled on the lawsuit.
The first unit at Dukovany, South Moravia, should be completed in 2036. The construction of the new nuclear units is expected to be the largest domestic expenditure in Czech history. The current estimated cost of the construction is CZK 407 billion.
Yesterday, Vlcek said his ministry had not received any official letter from the EC regarding a postponement of the signing of the Dukovany contract with KHNP, only a courtesy letter from Séjourné last Monday, 5 May.
The head of the Czech state-controlled energy company CEZ, Daniel Benes, said yesterday in response to Sejourne’s letter that the French side was not interested in winning the dispute over the completion of Dukovany, but in preventing the new plant from being built at all.
EDF denied this in a statement yesterday evening. The company said it was participating in the ongoing proceedings before the EC under the Foreign Subsidies Regulation, which have intensified in recent weeks, with the support of the French government. EDF stated it had never acted with the intention of disrupting the Czech nuclear program, and was exercising its legal right under EU law to raise legitimate concerns about the legality of a competitor’s bid.
EDF is “aware of the importance of the success of the Czech nuclear project and supports its implementation with at least 60% participation of local industry, in full transparency and in compliance with Czech and European legislation,” the company said, stating its readiness to negotiate with CEZ and the Czech authorities as necessary.
Environment Minister Petr Hladik (KDU-CSL) said he did not consider the timing of the EC’s letter to be coincidental, nor the fact that it was sent by the French EC Vice-President.
Czech PM Petr Fiala (ODS) said the letter from Sejourne asking for the postponement of signing the contract was just his opinion, not the opinion of the EC.
“As far as I know, this is a letter from the European Commissioner, it is not the opinion of the European Commission and has no binding effect on us,” he told the media. “Much more serious for us is the interim measure issued by the court, which orders us to wait to sign the contract until after the decision on the lawsuit.”
The French ambassador in Prague, Stephane Crouzat, said it was legitimate for EDF to defend its interests, as is not unusual in the case of such a large-scale project. “The appeals filed are intended to determine, in the interest of the European Union and the Czech Republic itself, whether or not the winning bid is in breach of fair competition rules and the law,” he added.
However, answering questions from Czech journalists, Commission spokesman Thomas Regnier said the letter was not a French commissioner defending French interests, but a member of the European Commission’s board enforcing legislation and cooperating with the Czech authorities to protect the single market.
Regnier confirmed that the commission had sent a letter to the Czech government expressing concerns about the regulation on foreign subsidies affecting South Korean companies. He said this was not the first step the Commission has taken, having already sent a request for information to the Czech Republic on 12 February, to which it received no reply.
Regnier stressed the EC was not requesting the project to be suspended.
However, the letter, which was seen by CTK, is entitled: “Request for immediate action to suspend the signing of the contract for the new nuclear reactors at Dukovany”, and indirectly refers to the postponement of the construction.
Czech European Commissioner Jozef Síkela (STAN) told journalists that he knew the content of the letter, but would not comment on it until he spoke directly with Sejourné today.
The Commission has already launched a preliminary review to assess whether potential foreign financial contributions received by the Korean firm constitute foreign subsidies and, if so, whether these foreign subsidies distort the internal market.
The review concerns the Czech Republic’s compliance with the Foreign Subsidies Regulation (FSR) of 2022, aimed at preventing distortion of the internal market. According to the letter, the duty of loyal cooperation requires the Czech Republic to avoid any situation that would irreversibly contradict the concerns raised, and that could have irreversible effects impeding the effective application of the FSR.
In this context, the EU executive stresses that it “does not prejudge the final decision”, but is currently preparing a decision to open an in-depth investigation, the letter reads.
“We are not yet at the stage of launching an in-depth investigation, and I would not like to prejudge whether we are going to do so or not,” said an EC spokesman yesterday, adding that EC Vice-President Sejourne was simply engaging with a member state about industrial decisions, as he always does. Depending on the information subsequently provided to the Commission, the EU executive will decide whether or not to take further action, he added. He said there is no time limit for a decision in this case.
