Estonian Oil Company Accuses Government of Allowing Competitor to Breach Environmental Requirements and Distort Competition
Tallinn, Estonia – In a recent development, AS Terminal, a major oil company in Estonia, has filed a complaint against the Estonian state for allegedly giving illegal state aid to its domestic automotive fuels market competitor, AS Olerex. The complaint, submitted by the company’s head Rauno Raudsepp, highlights the impact of this aid on the market and the environment.
According to the complaint, the Estonian state has allowed Olerex to escape from the obligation to use renewable energy in transport, giving them an unfair competitive advantage. This not only goes against the goal of the European Union to move towards more environmentally friendly transport but also distorts competition in the market.
The complaint estimates that Olerex has gained a benefit of up to €35 million per year in savings by not complying with environmental requirements on the use of biofuels. In addition, they have avoided up to €20 million per year in fines that have not been applied by the Estonian state. This has allowed Olerex to increase its market share and profits, resulting in higher fuel prices for certain consumer segments.
The Estonian government has cited procedural complexities as a reason for not imposing fines on Olerex or fining them insufficiently for several breaches of the biofuel obligation from 2021 to 2023. However, this has been deemed unfair and unlawful by the claimant. Raudsepp states, “Making sure that the applicable regulation works effectively is a core function of the state and certainly the Estonian government cannot use its own failure as an excuse for illegal state aid.”
The complaint also highlights the government’s favorable stance towards Olerex, despite their failure to comply with biofuel obligations in the transport sector. The Estonian state has refused to order Olerex to fulfill their legal obligations, further supporting the company’s unfair advantage in the market.
Established in 1994, AS Terminal (formerly known as AS Tartu Terminal) is a leading fuel sales company in Estonia. With 45 service stations and a national-wide fast charging network for electric vehicles, the company employs 330 individuals.
This complaint has been filed with the hope that the EU Commission will assess and recover the alleged illegal state aid given to Olerex, ensuring fair competition in the market and promoting the EU’s goals of a greener transport system.
Derick is an experienced reporter having held multiple senior roles for large publishers across Europe. Specialist subjects include small business and financial emerging markets.