tce ect communications

            

PRE-ACTION CORRESPONDENCE REGARDING UNLAWFUL RECEIPT AND RETENTION OF ENERGY CHARTER TREATY AWARD PAYMENTS AND RESULTANT MARKET DISTORTIONS – PROPOSAL FOR RESOLUTION ON BEHALF OF AFFECTED CLASS

Dear [Mr./Ms. Last Name],

We are writing to you on behalf of The Competition & Consumer Organisation Party Limited (COCOO), a UK-based public interest company dedicated to upholding market fairness, protecting consumer and taxpayer interests, and ensuring compliance with the rule of law. COCOO represents a substantial class of individuals and entities who have suffered significant harm as a direct result of your company’s receipt and retention of funds disbursed by the Kingdom of Spain under an Energy Charter Treaty (ECT) arbitration award, which we contend was made and paid in circumstances that render it unlawful and contrary to fundamental legal principles, including European Union law.

The purpose of this correspondence is to formally notify you of the serious claims our represented class holds against [Potential Defendant PLC Name] and to invite you to enter into immediate and confidential discussions with a view to achieving a fair and comprehensive settlement. Should such discussions not commence or prove fruitful within a reasonable timeframe, we are instructed to prepare and initiate formal legal proceedings without further notice.

The basis of the claims against your company primarily includes, but is not limited to, unjust enrichment through the receipt of public funds paid pursuant to an ECT award that is demonstrably invalid, particularly in light of EU legal principles confirmed by the Court of Justice of the European Union. These payments, sourced from Spanish public finances, effectively constitute illegal State aid, conferring an undue selective advantage upon your company and distorting competition within the energy market. This has caused direct financial loss to taxpayers, anti-competitive harm to other market participants, and broader economic detriment to consumers. The actions and omissions leading to these unlawful payments and their subsequent retention by your company give rise to viable claims in tort and for restitution.

The affected class we represent is diverse, encompassing Spanish and UK taxpayers whose funds have been improperly utilized, consumers impacted by resultant market inefficiencies, and businesses, including Spanish Small and Medium-sized Enterprises and energy cooperatives, who have suffered competitive disadvantage due to the preferential treatment afforded to ECT award beneficiaries such as yourselves, particularly when these domestic entities were denied equivalent redress for similar regulatory impacts.

COCOO has undertaken exhaustive research and compiled a substantial body of evidence and legal analysis substantiating these claims. This includes detailed assessments of the relevant ECT awards, the application of EU law (notably the principles established in Komstroy and Achmea, and State aid rules), the economic impact of the payments, and the quantifiable damages suffered by the class members. An overview of the grounds for our claims is provided in the Annex Report accompanying this letter. This report is intended to provide you with a clear understanding of the serious nature of the issues and the strength of the case against [Potential Defendant PLC Name].

While the claims are substantial and the grounds for legal action are robust, COCOO and the class we represent are, at this stage, open to exploring a constructive resolution through confidential settlement discussions. We believe a negotiated outcome could provide a more efficient and mutually acceptable resolution than protracted and costly litigation. We propose that such discussions commence within twenty-one (21) days from the date of this letter. Subject to a Non-Disclosure Agreement, we would be prepared to share further detailed information regarding our claims and the evidence supporting them during these discussions.

Please be advised that should we not receive a substantive response indicating your willingness to engage in good faith settlement discussions by [Date – 21 days from letter date], we will proceed with the necessary steps to initiate formal legal proceedings against [Potential Defendant PLC Name] to recover the unlawfully received funds and seek full compensation for the damages inflicted upon the class we represent.

We trust that you will give this matter your most serious and urgent attention. We look forward to your positive response and an opportunity to discuss a path towards a fair and equitable resolution.

Yours sincerely,

Oscar Moya Lledo

Director and In-house Solicitor (SRA n. 333300)

The Competition & Consumer Organisation Party Limited (COCOO)

Encl. Annex Report

Annex Report to Potential Class Defendant

Title: Summary Report in Support of Claims by Affected Parties Represented by COCOO Regarding the Unlawful Receipt and Retention of Energy Charter Treaty Award Payments by [Potential Defendant PLC Name]

1. Introduction

This report provides a summary overview of the grounds for significant legal claims held by a class of affected parties, represented by The Competition & Consumer Organisation Party Limited (COCOO), against [Potential Defendant PLC Name]. These claims arise from your company’s receipt and continued retention of substantial funds disbursed by the Kingdom of Spain pursuant to an Energy Charter Treaty (ECT) arbitration award. COCOO contends that these payments were made under circumstances rendering them unlawful, particularly under prevailing European Union law, and have resulted in unjust enrichment for your company and considerable harm to the represented class.

2. Overview of [Potential Defendant PLC Name]’s Conduct Subject to Claim

This section would briefly detail the specific ECT award received by the PLC, the approximate amount and date of payment by Spain, and the context of the regulatory changes in Spain’s renewable energy sector that led to the original arbitration claim. It would note that despite subsequent developments in EU law clarifying the invalidity of such intra-EU arbitration mechanisms and/or the characterization of such payments as illegal State aid, [Potential Defendant PLC Name] has retained these funds.

3. Principal Legal Grounds for Claims

The claims against [Potential Defendant PLC Name] are founded, inter alia, on the following legal principles:

  • Unjust Enrichment: Your company has been unjustly enriched at the expense of Spanish public funds, and by extension its taxpayers, through the receipt of payments to which it was not lawfully entitled under EU law.
  • Receipt of Illegal State Aid: The payments constitute illegal State aid under Articles 107-108 of the Treaty on the Functioning of the European Union (TFEU), as they were not notified to, nor approved by, the European Commission and confer a selective advantage that distorts or threatens to distort competition.
  • Accession to Harm Caused by Unlawful Means: By accepting and retaining funds derived from an award whose legal basis is fundamentally flawed under EU law (e.g., post-Komstroy and Achmea judgments if an intra-EU investor), your company has benefited from and perpetuated an unlawful situation.
  • Tortious Liability for Economic Harm: Where applicable, claims may arise for contributing to or benefiting from actions that have caused foreseeable economic harm and market distortion to other entities.

4. Profile of Harm to the Affected Class

The class of claimants represented by COCOO includes:

  • Spanish and UK Taxpayers: Who have borne the direct financial burden of the unlawful payments made from public funds.
  • Competitors and Other Businesses (including Spanish SMEs and energy cooperatives): Who have suffered competitive disadvantage due to the market distortions created by the illegal State aid granted to your company and similar beneficiaries. These entities were often denied redress for the same regulatory changes that led to your award.
  • Consumers: Who may ultimately bear the costs of market inefficiencies and distortions. The harm suffered is quantifiable and includes direct financial losses, loss of market opportunity, and the broader systemic damage to fair competition.

5. Outline of Remedies Sought

COCOO, on behalf of the affected class, will seek remedies including, but not limited to:

  • Full restitution of all unlawfully received funds, including principal and accrued interest.
  • Compensation for the financial damages suffered by the class members.
  • Measures to rectify any ongoing market distortions resulting from the illegal aid.
  • Legal costs and other appropriate relief.

6. Invitation to Resolution

COCOO believes in constructive dialogue as a means to resolve disputes efficiently and fairly. We invite [Potential Defendant PLC Name] to engage in confidential settlement negotiations to address the claims outlined herein. COCOO is prepared to make available, under appropriate confidentiality undertakings, further detailed evidence, economic analyses, and legal argumentation supporting these claims in the context of such negotiations. A proactive and collaborative approach to settlement is in the best interest of all parties to avoid protracted and costly legal proceedings.

Letter to the European Commission

The Competition & Consumer Organisation Party Limited (COCOO) 23 Village Way, Beckenham BR3 3NA, United Kingdom Email: contact@cocoo.uk Companies House Registration Number: 15466919

5 June 2025

Mr Jan Papsch Deputy Head of Unit B.3 Directorate-General for Competition European Commission Brussels, 1049 BELGIUM

Ref: Your letter COMP/B.3/EP/AT/RI/comp(2025)5693128 dated 22 May 2025

Subject: Response to your letter of 22 May 2025 – Substantiation of The Competition & Consumer Organisation Party Limited (COCOO)’s standing as an interested party in relation to possible illegal state aid and anti-competitive practices by the Spanish Government (Energy Charter Treaty arbitration awards and related energy policies)

Dear Mr Papsch,

We acknowledge receipt of your letter dated 22 May 2025, with reference COMP/B.3/EP/AT/RI/comp(2025)5693128, responding to our letter of 11 April 2025. We have given careful consideration to the Commission’s position that COCOO’s submission does not, at present, qualify as a formal complaint for the purposes of Council Regulation (EU) 2015/1589 due to a perceived lack of standing as an “interested party”.

We respectfully disagree with the Commission’s assessment. This letter and the accompanying Annex Report provide further clarification and substantiation of COCOO’s status as an interested party, both as an undertaking whose own economic activities are directly affected and as a representative of undertakings whose interests are directly affected by the alleged measures.

COCOO is a limited company registered in the United Kingdom (Companies House Registration Number: 15466919). Our registered economic activities under UK SIC codes include “management consultancy activities other than financial management” (70229), “investigation activities” (80300), “public relations and communication activities” (70210), and “other legal activities n.e.c.” cite_start. COCOO provides a range of services, including competition law research, regulatory analysis, strategic advocacy, and investigation services. We also operate a corporate membership program offering access to competition law insights and participation in regulatory discussions. These are clearly economic activities under EU law, contrary to the understanding expressed in your earlier letter of 11 April 2025 (COMP/B3*comp(2025)4647698) that COCOO “does not exercise any economic activity”.

The alleged illegal state aid and anti-competitive practices by the Spanish Government, specifically the discriminatory treatment in the context of Energy Charter Treaty (ECT) arbitration awards and related energy policies, create significant distortions in the energy market. These distortions directly and negatively affect the market conditions in which COCOO provides its economic services, particularly our consultancy on fair market conditions and our strategic advocacy for entities impacted by such regulatory matters. Our capacity to deliver these services effectively is intrinsically linked to a competitive and lawful market environment. Thus, COCOO has a direct and personal economic interest in ensuring the correct application of EU State aid rules and the cessation of the alleged unlawful practices which form the subject of our complaint.

Furthermore, COCOO’s mission explicitly includes representing the interests of consumers, taxpayers, and businesses potentially affected by anti-competitive practices and regulatory failures in Spain. Our membership base includes, and we actively engage with, undertakings whose economic interests are directly and adversely affected by the alleged State aid. These include Spanish Small and Medium-sized Enterprises (SMEs) and energy cooperatives that face a significant competitive disadvantage due to the Spanish government’s policy of allegedly compensating non-EU investors under the ECT while denying similar compensation to national entities for identical regulatory harm, as detailed in our submissions to the Spanish State Attorney for the Ministry of Energy on 12 May 2025. COCOO is mandated by its affected members, as part of its subscribed services, to represent their collective interests in matters of systemic market distortion and competition law infringements. We are prepared to provide further details regarding these mandates and the nature of the affected members the Commission may require, under appropriate confidentiality arrangements to protect their identities if necessary, to address your concern regarding the absence of a specific power of attorney.

Based on the foregoing, COCOO clearly meets the criteria for an “interested party” as defined under Article 108(2) TFEU and elaborated in Article 1(h) and Article 24(2) of Council Regulation (EU) 2015/1589. The alleged aid is likely to have a specific effect on our situation as an economic operator in the field of competition advocacy and consultancy, and the interests we represent – those of our affected members and the broader collective interests we are constituted to protect – are personal to us and directly impacted by the grant of the alleged aid. The information herein and in the Annex Report constitutes new and relevant information to change the assessment communicated to us.

We have attached an Annex Report that further details COCOO’s legal and economic nature, the basis for our standing as an interested party, and a summary of our concerns regarding the actions of the Spanish Government.

We therefore urge the Commission to reconsider its preliminary assessment in light of the clarifications and substantiations provided in this letter and the accompanying Annex Report. We formally request that the Commission register COCOO’s submission dated 7 March 2025, and subsequent related correspondence, as a formal complaint and proceed with a full investigation into the serious matters raised.

We remain at your disposal for any further information you may require.

Yours faithfully,

Oscar Moya Lledo Director and In-house Solicitor (SRA n. 333300) The Competition & Consumer Organisation Party Limited (COCOO)

Annex Report

ANNEX REPORT IN SUPPORT OF THE COMPETITION & CONSUMER ORGANISATION PARTY LIMITED (COCOO)’S STANDING AS AN INTERESTED PARTY

Date: 5 June 2025

Reference: Response to European Commission Letter COMP/B.3/EP/AT/RI/comp(2025)5693128

1. Introduction and Purpose of this Report

This report is submitted by The Competition & Consumer Organisation Party Limited (COCOO) to the European Commission (DG Competition) to supplement our letter of 5 June 2025. Its purpose is to provide further detailed substantiation of COCOO’s standing as an “interested party” under Article 108(2) of the Treaty on the Functioning of the European Union (TFEU) and Council Regulation (EU) 2015/1589 (“the Regulation”). This is in response to the Commission’s letters dated 11 April 2025 and 22 May 2025, which indicated that COCOO’s prior submissions were not considered a formal complaint due to a perceived lack of such standing.

2. The Competition & Consumer Organisation Party Limited (COCOO)

  • 2.1. Legal Status and Registered Activities

    • COCOO is a private limited company registered in the United Kingdom with Companies House Registration Number: 15466919.
    • Its registered address is 23 Village Way, Beckenham, BR3 3NA, United Kingdom.
    • COCOO is categorised under the following UK Standard Industrial Classification (SIC) codes, evidencing its engagement in economic activities:
      • 70210: Public relations and communication activities.
      • 70229: Management consultancy activities other than financial management.
      • 80300: Investigation activities.
      • https://www.google.com/search?q=69109: Other legal activities n.e.c..
    • These registrations confirm COCOO operates as an undertaking performing economic activities.

  • 2.2. Mission and Objectives

    • COCOO is a leading competition law research and advocacy group.
    • Our core mission is to promote competition, protect investors and consumers, and safeguard the public interest in the markets. This includes fostering economic efficiency, generating positive externalities, and safeguarding principles of free competition, investment, consumer welfare, and the public interest.
    • We aim to supervise decisions affecting competition and ensure transparency and accountability in markets.
    • As stated in our initial communication to the Commission, we represent the collective interests of consumers, taxpayers, and potentially affected businesses in Spain.

  • 2.3. Economic Activities: Consultancy, Investigation, and Advocacy Services

    • COCOO provides consultancy and investigation services.
    • We conduct regulatory research and analysis into matters such as Spain’s Recovery and Resilience Facility (RRF) fund allocation and Energy Charter Treaty (ECT) compensation framework.
    • COCOO offers a corporate membership program to companies, trade associations, and investors impacted by regulatory matters, which provides:
      • Access to competition law insights.
      • Participation in regulatory discussions.
      • Strategic advocacy on fair market conditions.
    • These services, offered to paying members and clients, constitute clear economic activities. The assertion in the Commission’s letter of 11 April 2025 that “COCOO does not exercise any economic activity” is therefore factually incorrect.

3. Substantiation of COCOO’s Standing as an “Interested Party”

  • 3.1. Direct Effect on COCOO’s Economic Activities and Personal Interests

    • COCOO, as an undertaking providing specialised consultancy and advocacy services in the field of competition law and regulatory affairs, has a direct economic interest in the lawful and competitive functioning of markets, including the Spanish energy market.
    • The alleged illegal State aid and anti-competitive practices by Spain arising from the management of ECT arbitration awards and related energy policies create significant market distortions.
    • These distortions directly undermine the fair market conditions COCOO advises on and advocates for. This impacts the value and effectiveness of our economic services to clients and members seeking stable, predictable, and lawful regulatory environments.
    • The existence of such alleged infringements, and the failure to address them, directly affect COCOO’s business operations, its reputation as an advocacy group, and its ability to fulfil its contractual obligations to its members to advocate for fair market conditions. This constitutes a specific effect on COCOO’s own situation and its personal interests as an economic operator.

  • 3.2. Representation of Directly Affected Undertakings

    • In line with Article 1(h) of the Regulation, “interested party” includes “any … undertaking … whose interests might be affected by the granting of aid, in particular the beneficiary of the aid, competing undertakings and trade associations”.
    • COCOO’s corporate membership includes undertakings, and we also act in the interest of Spanish SMEs and energy cooperatives, whose economic interests are directly and adversely affected by the alleged State aid granted by Spain.
    • Specifically, as argued in our letter of 12 May 2025 to the Spanish State Attorney (Ref: ECT.ADE) , Spanish SMEs and energy cooperatives are suffering competitive disadvantage and discriminatory treatment. These entities were harmed by Spanish regulatory changes in the renewable sector but, unlike certain non-EU investors, have not received compensation and their national claims were largely dismissed. They now have to compete with entities that have been or may be compensated from public funds for the same cause of damage.
    • COCOO represents these interests. Our terms of engagement with our members and the remit of our advocacy campaigns (such as the “Renovables Sin Barreras” initiative) empower us to act on their behalf in addressing systemic competition issues and alleged unlawful State aid that directly affect their market position and viability. We are prepared to discuss providing, under suitable confidentiality provisions, further evidence of these representative relationships if formally requested.

  • 3.3. Alignment with Council Regulation (EU) 2015/1589 and EU Case Law

    • COCOO’s direct economic interest, coupled with its role in representing directly affected member undertakings (competitors and other affected businesses), satisfies the conditions for being an “interested party” under Article 24(2) of the Regulation.
    • The alleged aid has a “specific effect” on COCOO’s situation as an economic actor in the competition field, and it is indeed COCOO’s “interests which are personal to him or her” (and those of its members it represents) which are affected by the grant of the alleged aid, consistent with the jurisprudence of the Union courts cited by the Commission (e.g., C-284/21 P, paragraph 60; C-83/09 P, paragraph 64).

4. Overview of the Alleged Infringements of EU State Aid Rules by Spain

  • 4.1. Summary of Allegations

    • COCOO’s complaint of 7 March 2025 and subsequent communications, including the detailed submission to the Spanish State Attorney of 12 May 2025, concern possible illegal State aid and anti-competitive practices.
    • These arise from Spain’s management of ECT arbitration awards, particularly the potential or actual payment of compensation to non-EU investors for regulatory changes in the energy sector, while Spanish undertakings (notably SMEs and cooperatives) affected by the same changes receive no such compensation and have had domestic claims dismissed. This is compounded by the CJEU rulings in Achmea and Komstroy deeming intra-EU ECT arbitration incompatible with EU law, and thus payments of intra-EU awards as potential illegal State aid.
    • Spain’s actions appear to selectively favour certain investors, distorting competition in the Spanish energy market. Payments of certain ECT awards (e.g., Eiser, Antin) were allegedly made without prior notification to the Commission, contrary to Article 108(3) TFUE.

  • 4.2. Impact on Competition, Consumers, and Taxpayers

    • The alleged practices create an unlevel playing field, disadvantaging Spanish national undertakings, including SMEs and cooperatives, who lack access to similar compensation.
    • Taxpayer funds are potentially used for illegal State aid , and consumers may bear additional burdens due to market inefficiencies and distorted investment signals.

5. COCOO’s Engagement and Submissions to Date

COCOO has been proactively engaging on this matter through multiple channels:

  • Petition to the European Parliament: Registered under No. 0047/2025 on 09.01.2025, concerning “Spain ECT-related damages”.
  • Complaint to the European Commission: Original letters dated 06.01.2025 and 07.03.2025 (Ref: Denuncia ECT.GOB.ESP), alleging illegal State aid and anti-competitive practices.
  • Communications with Spanish Authorities:
    • Letter to the Ministry of Foreign Affairs, 21 March 2025 (Ref: DIRRED MINEXTERIORES).
    • Letter to the Ministry of Economy, 21 March 2025 (Ref: DIRRED MINECONOMIA).
    • Detailed claim and information request to the State Attorney for the Ministry of Energy, 12 May 2025 (Ref: ECT.ADE).
    • Detailed claim and information request to the Cabinet of the Secretary of State for Energy, 12 May 2025 (Ref: ECT.GSEE).

6. Conclusion and Request to the European Commission

COCOO has demonstrated that it is an undertaking whose economic activities are directly affected by the alleged illegal State aid and anti-competitive measures of the Spanish Government. Furthermore, COCOO represents the interests of its members and other undertakings (such as Spanish SMEs and energy cooperatives) that are directly harmed by these measures.

COCOO therefore unequivocally qualifies as an “interested party” under Council Regulation (EU) 2015/1589 and relevant EU case law.

We respectfully request that the European Commission:

  • Reconsider its preliminary assessment of COCOO’s standing.
  • Register COCOO’s submissions of 7 March 2025 and subsequent related correspondence as a formal complaint.
  • Undertake a thorough investigation into the alleged infringements of EU State aid rules and competition law by the Kingdom of Spain.

COCOO stands ready to cooperate fully with the Commission and provide any additional information required.