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Endesa to appeal CNE rulings

10 November 2005 – Spanish utility Endesa is today expected to launch an appeal with the Industry Minister against two rulings by the National Energy Commission (CNE) and is to lodge a complaint with European authorities.

It will contest the decisions made on Tuesday by five of the nine CNE members concerning the transfer of gas distribution installations from Gas Natural SDG to two subsidiaries and Gas Natural’s hostile bid for Endesa.

Endesa considers that the CNE’s decisions are inconsistent with previous decisions made by that regulatory body in similar cases. Endesa also believes that the decisions suggest that regulated activities can be used to finance operations that go against the public interest, and that the decisions impose conditions that do not go any further than the strict legal minimum requirements.

Endesa also believes that the procedure followed by the CNE was unorthodox in denying Endesa access to the bulk of the existing documentation, preventing Endesa from practicing a petition of proof and awarding Endesa the minimum legal timeframe to launch an appeal against its decisions. Only a few hours before the appeal timeframe conceded to Endesa expired, the CNE approved a resolution proposal of roughly two hundred pages, which suggests that the final resolution had already been decided upon.