Power groups E.ON, GDF could face EU fines: report

(FRANKFURT) - The European Comission is set to slap German power giant E.ON with a heavy fine for alleged illegal collaboration with French rival Gaz de France, the business daily Handelsblatt said on Wednesday.

The fine could amount to several hundred million euros, perhaps as much as a half billion (700 million dollars), sources close to the matter were quoted as saying.

That would make it one of the biggest ever levied by the European Union's executive body.

The commission launched an investigation against the two companies in mid 2007 concerning gas delivered via their joint pipeline Megal, which crosses southern Germany from the border with the Czech Republic to the one with France.

E.ON's Ruhrgas subsidiary and Gaz de France (GDF) allegedly agreed on quantities of gas to be transported to their domestic markets, which the commission says would constitute an illegal marketing arrangement, the report said.

E.ON asserts that it never adhered to such a clause in its deal with GDF, and that it formally abrogated it in 2004.

The commision's decision is to be made public next week, sources told Handelsblatt, and a spokesman for E.ON Ruhrgas said the company expected a decision shortly.

If E.ON is fined, its boss Wulf Bernotat plans to file a complaint, the report said.