July 11, 2023
It took less than two weeks from the signing of the contract to the registration of the joint company of Serbia and Hungary for gas trade. It is one of a series of undertakings by which the two countries strengthen cooperation in the field of energy.
Both countries depend on Russian gas, and that is why they are making efforts to obtain and deliver this energy more easily and quickly from other sources. The effort intensified with Russia’s invasion of Ukraine last year, which led to an unprecedented global energy crisis. The agreement was signed within the joint session of the Government of Serbia and Hungary in Palić, in the north of Serbia on June 20 in the presence of the president and prime minister of the two countries.
In addition to the joint gas trading company, Serbia also rents gas storage from Hungary due to a lack of its own capacity.
Who are the owners and what is the goal of the joint venture?
According to the data of the Agency for Business Registers of Serbia, the company was registered in Novi Sad on July 3. It is jointly owned by the Hungarian MVM CEEnergy and the public company Srbijagas, which has a dominant role in the domestic gas market in Serbia. The Hungarian company has 51 percent ownership, Srbijagas 49 percent. Together, they invested 200 thousand euros as basic capital.
The director of Srbijagas, Dušan Bajatović, said in a statement to Tanjug on the day of registration of the joint venture, July 3, that the reason for this move was “an easier setup compared to the competition”.
Bajatović did not specify how the company will trade gas and in which countries. According to the assessment of the Energy Community, the EU energy regulatory body, Srbijagas, together with the Russian Gazprom, holds a dominant position on the gas market in Serbia. MVM CEEnergy, as stated on the company’s official website, is also the leader on the gas market in Hungary. Its goal is to strengthen its position in the region.
Srbijagas did not respond to Radio Free Europe’s (RSE) request to clarify where and with whom Serbia and Hungary will trade gas through a joint venture. The Ministry of Mining and Energy did not answer the questions either.
EC Secretariat: ‘Srbijagas not to use economic advantages’
In response to RSE’s questions, the Secretariat of the Energy Community (EC) states that it understands that this is a commercial decision between two companies and that at this stage “very little can be said about the prospects for the new company”.
However, they warned that Srbijagas, as a co-owner, “should not use economic advantages”. These advantages, as they explained, stem from the fact that Srbijagas, in addition to trading gas, also owns a transmission system for gas, for which it is not yet certified. The Energy Community also pointed out that the point of the gas pipeline connecting Serbia and Hungary near Horgoš (in Hungary) is not yet open to all suppliers under equal conditions. This prevents competition and, as they stated, “effectively closes the Serbian gas market”.
Serbia has included European regulations in its Law on Energy, according to which the gas market in the country should be open to everyone, under equal and transparent conditions.
