The European Commission has confirmed how European Union companies can pay for Russian gas without breaching the bloc’s sanctions on Russia, in updated guidance on the matter seen by Reuters.
The Commission told countries last month that European companies might be able to pay for Russian gas without breaching EU sanctions on Moscow, but only if they met certain conditions, after Russia demanded buyers foreigners start paying for gas in rubles or risk losing their supply.
In updated guidance, shared with EU countries on Friday and seen by Reuters, the Commission confirmed its previous view that EU sanctions do not prevent businesses from opening an account in a bank. designated, and companies can pay for Russian gas – as long as they do. in the currency agreed upon in their existing contracts and declare the transaction complete when that currency is paid.
Almost all supply contracts EU companies have with Russian gas giant Gazprom are in euros or dollars.
Russia cut off gas supplies to Poland and Bulgaria last month for refusing to comply with its demand for ruble payments. Several EU governments and major importers have asked for clarity from Brussels on whether they can continue to buy gas, which heats homes, generates electricity and powers factories across Europe.
Businesses should make a “clear statement” that when they pay euros or dollars they consider their obligations under existing contracts to be fulfilled, according to the guidelines.
It should be understood that “such payments in this currency definitively discharge the economic operator from the payment obligations under these contracts, without any further action on his part with regard to the payment”, he said.
By ending its obligations once it has deposited euros or dollars, a company could avoid being involved in transactions with the Russian central bank, which is subject to sanctions, and which could have been involved in the conversion of euros into rubles.
President Vladimir Putin’s decree had said that a transaction would not be considered complete until the foreign currency was converted into rubles.
The Commission did not immediately respond to a request for comment.
Eni and RWE open bank accounts
Italian energy group Eni said it would open bank accounts this week to pay for Russian gas after clarifying that such a move would not violate sanctions, two sources said on Monday (May 16th).
“The clarified guidelines have given Eni the green light,” one of the sources said.
Sources told Reuters last week that Eni would begin the process of opening a ruble account this week to pay for Russian gas unless advised it would violate sanctions.
The updated guidelines essentially offered Eni assurances that nothing to the contrary stands in its way, the second source said.
Earlier Monday, Germany’s RWE said it opened an account in Russia to pay for gas in euros.
“Eni is continuing its assessments and has not yet initiated any procedures to open two accounts,” an Eni spokesperson said.
Eni, one of Europe’s largest importers of Russian gas, is due to pay Russian state-owned Gazprom around May 20.
Under Russia’s new payment system, introduced in response to sweeping Western sanctions imposed after Moscow invaded Ukraine, shoppers are forced to deposit euros or dollars into an account at Russian private bank Gazprombank.
The bank will then convert the money into rubles, place the proceeds in another account belonging to the foreign buyer and transfer the payment in Russian currency to Gazprom.
Italy, which got around 40% of its gas from Russia last year, is trying to find alternative sources of supply.
