Section 13 of the German Energy Act from 1998 includes a legal basis for the conclusion of concession contracts and take-over rights. This provision has also been included in Section 46 of the new German Energy Industry Act from 2005 (EnWG).

However, Section 46, EnWG 2005 has been changed essentially by providing that concession contracts include only the grid access and not the general supply. The latter is carried out by the relevant basic supplier. Since the amendment of this Act, many municipalities have started to supply gas and electricity themselves. In spite of the unclear wording, from our point of view the right to take-over is a right of property transfer. This has been supported by court decisions even though not at the final instance. Additionally, in November 1999 the Federal Court of Justice decided that the so-called "Sachzeitwert" (fair value) as a basis for the purchase price does not violate cartel law from the outset; however, it contravenes cartel law if it is clearly higher than the profitability. This view has been re-confirmed by a decision of the Federal Court of Justice dated February 2006. This is also relevant in relation to Section 23a, EnWG, which deals with grid charges to be licensed and which have to be able to re-finance a purchase price to be paid. Therefore, grid take-overs can still present an attractive possibility to take the grid operation into one’s own hands. Thus, many possibilities exist with regard to collaborations.

Relevant questions (and legal services) include

• Drafting and review of new/previous concession contracts
• Providing legal advice in relation to announcement and selection procedures according to Section46 para. 2, 3 Energy Act
• Supervising and coordinating grid take-overs (power, gas, water, district heating)
• Supervising grid value evaluation (calculation of "Sachzeitwert", profitability)
• Questions of basic supplier position, property transfer etc.
• Reclamations due to excessive purchase prices

Contact persons in this area are Dr. Christian Theobald (Berlin) andMatthias Albrecht (Munich).