Belgian gov't reaches accord with France's Suez

The Belgian federal government has reached a deal with the French utilities giant Suez about its plans to merge with Gaz de France, VRT news reported Wednesday.

The Belgian government has received reassurances from Suez that the company will not exploit its dominant position and that it will continue to offer sharp rates to consumers, VRT quoted a government official as saying.

More details of the agreement will be available on Friday, it said. But the deal does not include Suez's payment of gas rebate that the federal government pays its citizens. The rebate is worth 100 million euros (127 million U.S. dollars) per year.

The federal government had expressed concern over the merger as the new company would have a near-monopoly on the Belgian gas and electricity market.

Suez fully owns Belgian Electrabel, which is the country's largest gas and electricity supplier.

The number two on the Belgian market, SPE, is partly owned by Gaz de France.

Earlier Wednesday, Belgium was told off by European Union Competition Commissioner Neelie Kroes for interfering with the merger plans between Suez and Gaz de France.

Kroes said mergers of this kind are beyond a member state's competence and therefore should only be dealt with by the European Commission.

However, Kroes also said that she understood Belgium's concern about its free energy market being under threat.

She added that Suez and Gaz de France have both submitted propositions but that so far the commission has not replied to them.

Source: Xinhua