S N T G N Transgaz S A : Appeal against Competition Council decision

CURRENT REPORT

According to Art. 234 (1) (l) of Financial Supervisory Authority Regulation No. 5/2018 on the issuers of financial instruments and market operations

Date of report: 06.12.2022

Name of issuing entity: SNTGN TRANSGAZ SA

Headquarters: Mediaş, 1 Constantin I. Motas Square, Sibiu County

Telephone/fax number: 0269803333/0269839029

Tax identification code: RO 13068733

Trade Register number: J32/301/2000

Subscribed and paid-up capital: 117.738.440 RON

Regulated market on which issued securities are traded: Bucharest Stock Exchange.

SNTGN Transgaz SA informs all those concerned that the court has communicated the decision pronounced in Case No. 76/2/2021 concerning the application of the undersigned for the annulment of Competition Council Decision No. 43/11.08.2020. The Bucharest Court of Appeal rejected the petition form against the sanctioning decision as groundless. The decision is not final and may be appealed.

Competition Council Decision No. 43/11.08.2020 established mainly the following:

• finding that Transgaz infringed Article 5(1) of Competition Law No. 21/1996 and of Article 101 TFEU as a facilitator of the understanding and/or a single and continuous concerted practice of sharing the market for construction of pipelines for natural gas transmission and related works in Romania, by distorting the competitive process in eight public procurement procedures organised in 2011;
• imposing a fine on Transgaz in the amount of 34,166,615.90320 lei, representing 1.84644% of the total turnover achieved by the company in 2019;
• the obligation to pay the fine within 30 days of the date of notification of the decision;
• the possibility to appeal the decision in administrative proceedings.

Considering that the investigation launched by the Competition Council represented a risk factor for the company's activity by imposing the fine, the company has set up a provision for this dispute since 2019 at the level of the fine established by the Competition Council Decision.

As we have previously communicated, the Competition Council's investigation concerns activities carried out in the framework of procedures for the award of works procurement contracts in the period 2009-2011, prior to the implementation of legal provisions on corporate governance at the level of SNTGN Transgaz SA. There are no other Competition Council investigations regarding sectoral procurement procedures.

SNTGN Transgaz SA is the technical operator of the National Gas Transmission System (NTS) ensuring the efficient, transparent, safe, non-discriminatory and competitive implementation of the national strategy for domestic and international transmission of natural gas, its dispatching as well as the research and design in the field, in compliance with the requirements of European and national legislation, quality, performance, environmental and sustainable development standards.

ION STERIAN

DIRECTOR - GENERAL