EUR-Lex - 31976D0248 - EN

III

UNDER ARTICLE 85 ( 3 ) , THE PROVISIONS OF ARTICLE 85 ( 1 ) MAY BE DECLARED INAPPLICABLE TO ANY AGREEMENT WHICH CONTRIBUTES TO IMPROVING THE PRODUCTION OR DISTRIBUTION OF GOODS OR TO PROMOTING TECHNICAL AND ECONOMIC PROGRESS , WHILE ALLOWING CONSUMERS A FAIR SHARE OF THE RESULTING BENEFIT , AND WHICH DOES NOT :

( A ) IMPOSE ON THE UNDERTAKINGS CONCERNED RESTRICTIONS WHICH ARE NOT INDISPENSABLE TO THE ATTAINMENT OF THESE OBJECTIVES ;

( B ) AFFORD SUCH UNDERTAKINGS THE POSSIBILITY OF ELIMINATING COMPETITION IN RESPECT OF A SUBSTANTIAL PART OF THE PRODUCTS IN QUESTION .

THE AGREEMENT BETWEEN BNFL , CEA AND KEWA IS SUCH AN AGREEMENT , FOR :

1 . THE AGREEMENT CONTRIBUTES TO IMPROVING THE PRODUCTION AND DISTRIBUTION OF REPROCESSING SERVICES AND TO PROMOTING TECHNICAL AND ECONOMIC PROGRESS :

( A ) BY COORDINATING INVESTMENTS , THE AGREEMENT ENSURES THAT UNECONOMIC PLANTS WILL NOT BE SET UP AND ENABLES THE PARTIES TO WAIT UNTIL MARKET CONDITIONS ARE MOST FAVOURABLE BEFORE SETTING UP HIGHCAPACITY PLANTS ; THIS REDUCES COSTS CONSIDERABLY BECAUSE OF THE SUBSTANTIAL SCALE EFFECT IN THIS INDUSTRY , AND THE PROJECTS ALSO BENEFIT FROM THE VERY LATEST TECHNICAL PROGRESS .

THE COORDINATION OF INVESTMENT ALSO HAS A DECISIVE IMPACT ON COST BY IMPROVING THE LOAD FACTOR OF EXISTING AND FUTURE PLANTS AND BY REDUCING IN THE SAME PROPORTION THE BURDEN OF FIXED COSTS , WHICH ACCOUNT FOR A MAJOR PROPORTION OF THE TOTAL COST OF REPROCESSING .

( B ) FURTHERMORE , THE FACT THAT SUPPLIES OF REPROCESSING SERVICES BY THE THREE PARTIES ARE CENTRALIZED ON THEIR JOINT SUBSIDIARY AND THE FLEXIBILITY PERMITTED BY CENTRALIZING THE OPERATION OF THE THREE PLANTS HELPS TO IMPROVE THE SERVICE OFFERED TO CONSUMERS BY RAISING SAFETY STANDARDS AND BY STABILIZING IRRADIATED FUELS REPROCESSING SERVICES . THIS LAST POINT IS IMPORTANT IN THAT THE STEADY ARISING OF IRRADIATED FUELS IS INEVITABLE . THEY ARE HIGHLY RADIOACTIVE AND THE TIME REQUIRED FOR REPROCESSING IS GOVERNED BY TECHNOLOGICAL FACTORS ; AMONG OTHER THINGS , STORAGE POOLS AT NUCLEAR POWER STATIONS ARE ONLY OF LIMITED CAPACITY , SO THAT IF REPROCESSING SERVICES WERE NOT AVAILABLE IT WOULD BE NECESSARY EITHER TO SHUT THE POWER STATION DOWN OR TO CONSTRUCT VERY EXPENSIVE ADDITIONAL POOLS . MOREOVER , THE RANGE OF SERVICES OFFERED BY URG WILL BE BROADER , AND EACH CUSTOMER WILL BE ABLE TO BENEFIT FROM THE EXPERIENCE ACQUIRED BY THE THREE PARTIES IN REPROCESSING THE VARIOUS TYPES OF OXIDE FUELS .

( C ) BY COMBINING RESEARCH EFFORTS , THE AGREEMENT WILL HELP PROGRESS TO BE MADE AS QUICKLY AS POSSIBLE IN A NEW BRANCH OF TECHNOLOGY WHERE FURTHER DEVELOPMENTS ARE STILL AWAITED ON A NUMBER OF POINTS ( REPROCESSING OF NEW FUELS , TRANSPORT , STORAGE OF WASTE ) , WHILE HELPING TO REDUCE OPERATING COSTS AND TO IMPROVE THE GENERAL STANDARD OF SERVICE .

( D ) THE FACT THAT PLANTS OF OPTIMUM SIZE CAN BE BUILT AND CAN WORK WITH OPTIMUM LOAD FACTORS THROUGH THE COORDINATION OF INVESTMENTS AND CENTRALIZATION OF SUPPLIES AND WORK PLANNING MEANS THAT , AT LEAST IN THE MEDIUM TERM , THE REPROCESSING INDUSTRY CAN BE MADE PROFITABLE IN EUROPE . THE CIRCUMSTANCES WILL THUS BE CREATED IN WHICH THE PARTIES WILL BE ABLE TO DEVELOP THEIR ACTIVITIES IN THIS FIELD ON A SOUND ECONOMIC FOOTING .

2 . THE AGREEMENT ALLOWS CONSUMERS A FAIR SHARE OF THE RESULTING BENEFIT :

BY EXERTING BENEFICIAL PRESSURE ON COSTS AND BY GUARANTEEING THE STABILITY OF THE PROVISION OF REPROCESSING SERVICES , THE AGREEMENT WILL OPEN THE WAY TO AN EVENTUAL DROP IN PRICES CHARGED TO USERS , IN THIS CASE ELECTRICITY PRODUCERS . BY MEANS OF THE CONDITIONS AND OBLIGATIONS WHICH IT WILL IMPOSE ON THE PARTIES AND THROUGH ITS SUBSEQUENT SUPERVISION , THE COMMISSION WILL ENSURE THAT NO BEHAVIOUR OF THE PARTIES CAN PREVENT USERS FROM RECEIVING THEIR SHARE OF THE RESULTING BENEFIT . MOREOVER THE ELECTRICITY PRODUCERS WILL USE THEIR ECONOMIC STRENGTH TO EXERT PRESSURE IN THE SAME DIRECTION .

3 . THE AGREEMENT IMPOSES NO RESTRICTIONS OF COMPETITION WHICH ARE NOT INDISPENSABLE TO THE ATTAINMENT OF THESE OBJECTIVES :

( A ) IN VIEW OF THE SPECIFIC CHARACTERISTICS OF THE REPROCESSING INDUSTRY AND OF THE WAY THE MARKET IS LIKELY TO DEVELOP , IT IS INDISPENSABLE TO COORDINATE INVESTMENTS IF CAPACITY LEVELS ARE TO BE SET HAVING REGARD ONLY TO ECONOMIC AND COMMERCIAL REQUIREMENTS .

IN THE ABSENCE OF AN AGREEMENT TO COORDINATE INVESTMENT IT IS TO BE FEARED THAT CERTAIN STATES WOULD RAPIDLY TAKE AN INCOHERENT SERIES OF DECISIONS TO FINANCE FROM THEIR NATIONAL BUDGETS PLANTS WHICH WOULD BE EITHER TOO SMALL OR IN ADVANCE OF MARKET REQUIREMENTS , THUS PREVENTING ANY PLANT IN THE COMMON MARKET FROM QUICKLY REACHING ITS OPTIMUM LOAD FACTOR . THIS WOULD CERTAINLY HARM THE COMMUNITY'S INTERESTS , FOR THE REPROCESSING INDUSTRY WOULD THEN GET STRUCTURED ON THE BASIS OF NATIONAL RATHER THAN COMMUNITY REQUIREMENTS .

THE THREE GOVERNEMENTS CONCERNED SUPPORTED THE CONCLUSION OF THE AGREEMENT IN ORDER TO AVOID BECOMING ENGAGED IN WASTEFUL COMPETITION AGAINST THE PUBLIC INTEREST . THIS WAS PARTICULARLY SO IN RESPECT OF THE GERMAN GOVERNMENT , WHICH WISHES TO PROMOTE THE INDUSTRIAL EXPLOITATION OF THE RESEARCH IT HAS BEEN CARRYING OUT AND WOULD OTHERWISE ENCOURAGE THE BUILDING OF A NATIONAL INDUSTRIAL-SCALE PLANT . THE AGREEMENT , WITHOUT ENTAILING NEW EXPENDITURE , MEETS ITS WISH TO ENSURE THAT GERMAN PRIVATE ENTERPRISE SHALL HAVE ACCESS TO THE TECHNOLOGY AND SUBSEQUENTLY BE ABLE TO ENTER THE REPROCESSING MARKET UNDER OPTIMUM ECONOMIC AND INDUSTRIAL CONDITIONS .

THE COORDINATION OF INVESTMENTS IS THEREFORE TO BE REGARDED AS INDISPENSABLE FOR A PERIOD ASSURING , FOR EACH OF THE PLANTS COVERED BY THE AGREEMENT , AN ECONOMICALLY SATISFACTORY LOAD FACTOR BEFORE ANY OTHER PLANT IS COMMISSIONED .

THE COMMISSION WILL MONITOR DEVELOPMENTS IN THE LOAD FACTORS OF THE PLANTS COVERED BY THE AGREEMENT FOLLOWING START-UP OF THE GERMAN PLANT TO ENSURE THAT THE AGREEMENT IS NOT MAINTAINED AFTER ITS OBJECT IS ACTUALLY ACHIEVED , HAVING REGARD TO CONDITIONS ON THE REPROCESSING MARKET AT THAT TIME .

( B ) THE FACT THAT THE JOINT SUBSIDIARY WILL SET THE PRICES TO BE CHARGED FOR REPROCESSING AND WILL ALLOCATE THE ACTUAL REPROCESSING WORK IS A NECESSARY ADJUNCT OF COORDINATING INVESTMENTS BETWEEN THE THREE PARTIES , EACH OF WHICH IS OPERATING ITS PLANT AND MUST BE SURE THAT IT WILL BE ABLE TO WORK TO A RATE WHICH THE OTHER PARTIES UNDERTAKE TO ALLOW . SUPPLIES MUST THEREFORE BE CENTRALIZED IF URG IS TO BE ABLE TO PLAN THE WORK IN THE LIGHT OF AVAILABLE CAPACITIES . THIS NECESSARILY MEANS THAT THE PRICE TO THE USER WILL BE THE SAME WHICHEVER PLANT ACTUALLY DOES THE REPROCESSING .

( C ) EXCHANGE OF SCIENTIFIC AND TECHNICAL INFORMATION MUST ALSO NECESSARILY ACCOMPANY THE COORDINATION OF INVESTMENT AND THE ALLOCATION OF TONNAGES , SINCE EACH PLANT MUST BE IN A POSITION TO REPROCESS IRRADIATED FUELS OF WHATEVER SOURCE , AND KEWA MUST BE SURE THAT WHEN THE TIME COMES IT WILL HAVE AT ITS DISPOSAL THE TECHNOLOGY REQUIRED TO BUILD ITS PLANT .

( D ) THE CLAUSE REQUIRING EACH PARTY TO REFRAIN FROM OXIDE FUELS REPROCESSING OTHERWISE THAN THROUGH THE JOINT SUBSIDIARY IS , IN THE PARTICULAR CIRCUMSTANCES OF THE AGREEMENT , A NECESSARY COROLLARY TO THE FORMATION OF THE SUBSIDIARY AND IS INDISPENSABLE TO ITS OPERATION .

( E ) THE CLAUSE REQUIRING URG TO ATTEMPT TO BRING INTO THE AGREEMENT ANY ORGANIZATION COMMITTING INVESTMENT IN A REPROCESSING PLANT IN EUROPE BEFORE THE COMMISSIONING OF KEWA IS ALSO IN LINE WITH THE AIM OF THE AGREEMENT , WHICH IS TO PERMIT THE FIXING OF AN OPTIMUM TIME SCHEDULE FOR THE CONSTRUCTION AND COMMISSIONING OF PLANTS , IN THE LIGHT OF MARKET REQUIREMENTS .

4 . THE AGREEMENT DOES NOT AFFORD THE PARTIES THE POSSIBILITY OF ELIMINATING COMPETITION IN RESPECT OF A SUBSTANTIAL PART OF THE RELEVANT MARKET , HAVING REGARD TO THE CIRCUMSTANCES OF THE CASE , AND IN PARTICULAR TO THE SPECIAL CHARACTERISTICS OF THIS MARKET , FORECAST TRENDS ON THE MARKET AND THE LIMITED DURATION OF THE AUTHORIZATION ACCORDED .

ADMITTEDLY , DURING A TRANSITIONAL PERIOD ( WHICH DOES HAVE A FIXED DATE OF EXPIRY ) URG'S ONLY COMPETITORS IN THE COMMON MARKET WILL BE THREE SMALL-SCALE REPROCESSING UNITS ( KARLSRUHE , MOL , EUREX I ) , TWO OF WHICH ARE EITHER SHUT DOWN OR ARE BEING USED FOR REPROCESSING NON-OXIDE NUCLEAR FUELS ; FROM 1978 IT MIGHT POSSIBLY HAVE TO COMPETE WITH THE NEW EUROCHEMIC PLANT _ A RELATIVELY SMALL ONE _ AND LATER STILL WITH EUREX II .

MOREOVER , HAVING REGARD TO THE DESCRIPTION OF THE MARKET ALREADY GIVEN ABOVE , THE COMPETITION FROM EUROPEAN PLANTS OTHER THAN THOSE INVOLVED IN URG AND FROM NON-EUROPEAN PLANTS MUST BE CONSIDERED AS ONLY SLIGHTLY EFFECTIVE FOR THE NEXT FEW YEARS .

HOWEVER , THE EVENTUAL CREATION OF EFFECTIVE COMPETITION IS BOTH ONE OF THE AIMS OF THE AGREEMENT AND ONE OF THE CONDITIONS IMPOSED BY THE COMMISSION ONCE THE OBJECTIVE REQUIREMENTS , I.E . , ADEQUATE LOAD FACTORS , ARE MET , A TIME LIMIT ALSO BEING FIXED . ACCORDINGLY , THE UNDERTAKINGS CONCERNED ARE FACED WITH THE CERTAINTY OF BECOMING COMPETITORS AT THAT TIME , WHICH OBLIGES THEM TO BEHAVE FROM NOW ON BEARING THIS IN VIEW , ESPECIALLY AS USER FIRMS , I.E . , PRODUCERS OF ELECTRICITY , ARE ECONOMICALLY STRONG ENOUGH TO EXERT PRESSURE IN THE SAME DIRECTION , WHICH IS IN LINE WITH THEIR OWN INTERESTS .

HENCE , THE AGREEMENT DOES NOT AFFORD THE PARTIES THE POSSIBILITY OF ELIMINATING COMPETITION WITHIN THE MEANING OF ARTICLE 85 ( 3 ) .

IV

1 . PURSUANT TO ARTICLE 6 ( 1 ) OF REGULATION N 17 , THE DECISION CAN HAVE EFFECT FROM 12 OCTOBER 1971 , WHICH IS THE DATE OF SIGNATURE OF THE AGREEMENT NOTIFIED ON 11 OCTOBER 1971 .

2 . PURSUANT TO ARTICLE 8 OF REGULATION N 17 , THE DECISION IS ISSUED FOR A SPECIFIED PERIOD AND THE COMMISSION MAY REVOKE OR AMEND ITS DECISION IF THERE IS A CHANGE IN ANY OF THE FACTS WHICH WERE BASIC TO THE MAKING THEREOF .

THE AGREEMENT CAN BE AUTHORIZED ONLY FOR SUCH TRANSITIONAL PERIOD AS IS STRICTLY NECESSARY FOR THE REPROCESSING INDUSTRY TO CHANGE OVER TO CONDITIONS OF EFFECTIVE COMPETITION . THAT TRANSITIONAL PERIOD WILL END WHEN THE THREE PLANTS COVERED BY THE AGREEMENT ARE ASSURED OF ACHIEVING ECONOMICALLY SATISFACTORY LOAD FACTORS . THE COMMISSION BELIEVES THAT IF THE THREE PLANTS ARE WORKING AT AN AVERAGE RATE OF 75 % OF THEIR TOTAL CAPACITY , IRRESPECTIVE OF THE PROPORTIONS IN WHICH THE THREE PARTIES FEEL THAT THE WORK SHOULD BE ALLOCATED AT THAT TIME , THIS CONDITION WILL BE MET . ACCORDINGLY , THE AUTHORIZATION SHOULD BE LIMITED SO AS TO TERMINATE AUTOMATICALLY AS SOON AS THAT 75 % LOAD FACTOR HAS BEEN REACHED FOR TWO SUCCESSIVE YEARS .FURTHERMORE , HOWEVER THE MARKET DEVELOPS , AN ULTIMATE DATE SHOULD BE FIXED ON THE AGREEMENT WHICH WILL IN ANY EVENT EXPIRE . A PERIOD OF 15 YEARS FROM THE ENTRY INTO FORCE OF THE AGREEMENT IS LONG ENOUGH TO ENABLE THE PARTIES TO PURSUE THEIR JOINT EFFORTS TOWARDS ATTAINING THE FAVOURABLE RESULTS SOUGHT BY THEM .

3 . UNDER ARTICLE 8 OF REGULATION N 17 , CONDITIONS AND OBLIGATIONS MAY BE ATTACHED TO THE DECISION , AND THE COMMISSION MAY REVOKE OR AMEND ITS DECISION OR PROHIBIT SPECIFIED ACTS BY THE PARTIES WHERE THE PARTIES ABUSE THE EXEMPTION FROM THE PROVISIONS OF ARTICLE 85 ( 1 ) OF THE EEC TREATY GRANTED BY THE DECISION .

THE COMMISSION'S DECISION RELATES SOLELY TO THE AGREEMENT AS IT IS ACTUALLY OPERATING AT THE PRESENT TIME . THE AUTHORIZATION DOES NOT COVER ANY DIRECT OR INDIRECT EXTENSION OF THE CURRENT SCOPE OF URG'S ACTIVITIES , NAMELY THE MARKETING OF REPROCESSING SERVICES FOR OXIDE NUCLEAR FUELS , TO OTHER ACTIVITIES , WHETHER SUCH ACTIVITIES BE ENVISAGED BY THE AGREEMENT ( TRANSPORT , OTHER OPERATIONS IN THE FUEL CYCLE , TRADE IN RECOVERED PRODUCTS , OPERATING OR OWNERSHIP OF PLANTS ) OR NOT ( E.G . , REPROCESSING OF FUELS OTHER THAN OXIDE FUELS ) ; NOR DOES IT COVER THE DETERMINATION OF A COMMON POSITION ON INVESTMENT EXTENDING BEYOND THE THREE PLANTS AS DESCRIBED IN THE AGREEMENT , NOR THE EXTENSION OF THE AGREEMENT TO OTHER PARTIES .

FURTHERMORE , IN VIEW OF THE POSITION URG WILL HOLD ON THE EUROPEAN REPROCESSING MARKET DURING THE CURRENCY OF THE AUTHORIZATION , THE COMMISSION FEELS THAT IT MUST SUPERVISE THE PRICES AND CONDITIONS APPLIED BY URG . THE PARTIES MUST THEREFORE BE REQUIRED TO COMMUNICATE TO THE COMMISSION ITS PRICES AND CONDITIONS , THE CONTRACTS IT CONCLUDES WHICH RELATE TO REPROCESSING OR WHICH MIGHT EXTEND THE CURRENT SCOPE OF ITS ACTIVITIES , THE PRINCIPLES OF THE MARKETING POLICY DECIDED ON BY ITS BOARD AND ITS ANNUAL BALANCE SHEETS , AND PROFIT AND LOSS ACCOUNTS .

THIS WILL ENABLE THE COMMISSION TO FOLLOW DEVELOPMENTS IN THE LOAD FACTORS OF THE PLANTS AND TO ENSURE THAT URG ALLOWS CONSUMERS A FAIR SHARE OF THE BENEFITS RESULTING FROM THE AGREEMENT AND GENERALLY COMPLIES WITH THE COMPETITION RULES OF THE EEC TREATY . IN THIS CONNECTION IT SHOULD BE RECALLED THAT URG WILL REMAIN SUBJECT TO THE PROVISIONS OF CHAPTER VI OF TITLE 2 OF THE EURATOM TREATY , IN PARTICULAR ARTICLE 75 AS REGARDS REPROCESSING AND ARTICLE 52 AS REGARDS DEALINGS IN SOURCE MATERIALS AND SPECIAL FISSILE MATERIALS .

THE COMMISSION MUST BE INFORMED BY THE PARTIES OF THE ARRANGEMENTS MADE BY THEM FOR THE EXCHANGE OF KNOW-HOW AND THE GRANT OF LICENCES , SINCE COMPETITION MAY BE RESTRICTED THEREBY .

4 . THE OBSERVATIONS RECEIVED BY THE COMMISSION IN RESPONSE TO THE NOTICE PUBLISHED IN PURSUANCE OF ARTICLE 19 ( 3 ) OF REGULATION N 17 DREW ITS ATTENTION PRINCIPALLY TO THE NEED TO ESTABLISH CLEARLY THAT ALL THE RESTRAINTS OF COMPETITION IN THE AGREEMENT WERE INDISPENSABLE AND TO ATTACH CONDITIONS AND OBLIGATIONS TO THE DECISION SO AS TO MAKE URG'S MARKETING POLICY SUBJECT TO EFFECTIVE SUPERVISION AND TO ENSURE THAT A FAIR SHARE OF THE BENEFITS RESULTING FROM THE AGREEMENT ACCRUED TO USERS . THE COMMISSION HAS PAID DUE ATTENTION TO THESE OBSERVATIONS ,

HAS ADOPTED THIS DECISION :