MOL and Slovnaft submitted another formal complaint to the European Commission over JANAF’s abusive pricing practices

JANAF has consistently applied abusive pricing practices that are not supported by objective reasons. Following the outbreak of the Russia-Ukraine war in 2022, despite the fact that the volume ordered by MOL Group increased by one and a half times, JANAF significantly increased its fee to nearly double its previous level and maintained this excessive price level in the years thereafter. For four years now, since the outbreak of the war, JANAF has not provided a substantiated justification for the fee increases and continues to refuse to disclose information regarding the cost factors or the methodology underlying its pricing.

The transit fee in Croatia on a per-unit basis is currently more than three times higher than the fee charged by the operator of the TAL pipeline, which runs from the nearby port of Trieste through Germany to Vienna. It is almost twice as high on a per-unit basis as the fee MOL Group pays for the Ukrainian section of the Druzhba pipeline running through a war-affected area. At the same time, it significantly exceeds the prices of European crude oil pipelines whose technical and economic conditions, including utilization rates, are very similar to those of JANAF. Pipelines operating with similar utilization levels charge significantly lower fees: on a per-unit basis the Slovak pipeline charges a fee four times lower than JANAF’s, the Hungarian pipeline charges a fee three times lower, while the Belarusian pipeline charges fees seven times lower than JANAF’s.

Under EU competition law, JANAF holds monopol position in the market for the transportation of crude oil to inland refineries in Hungary and Slovakia. EU competition law classifies the imposition of unfair purchase or selling prices, or other unfair trading conditions, as an abuse of a dominant position. According to MOL and Slovnaft, the fee increases imposed by JANAF are excessive compared to its costs and cannot be objectively justified. Through its conduct, JANAF is exploiting the advantages created by Russia’s invasion of Ukraine, including the current inoperability of the Druzhba pipeline. This harms consumers and endangers the security of energy supply in the vulnerable Central and Eastern European region. Due to the suspected abuse, MOL and Slovnaft have therefore submitted another formal complaint to the European Commission’s Directorate-General for Competition.

According to MOL Group, in addition to unfair pricing, the Croatian party is also violating EU law in relation to Russian crude oil shipments. JANAF continues to be reluctant to provide a clear position on whether it will allow through legal shipments that comply with EU and US sanctions, including OFAC provisions. MOL and Slovnaft submitted a formal complaint to the European Commission in this matter at the beginning of March.

The existing supply challenges are further aggravated by additional legal uncertainty due to the fact that the contractual process with JANAF is dragging on, and MOL Group still does not have a valid transport contract for 2026. At the same time, the planned capacity tests could not begin due to the Croatian company.