The Government of the Republic of Slovenia and the Government of the Republic of Croatia, hereinafter referred to as “the Parties”,
Having regard to Regulation (EU) 2017/1938 of the European Parliament and of the Council of 25 October 2017 concerning measures to safeguard security of gas supply (OJ L 280, 28. 10. 2017) (hereinafter “the Regulation (EU) 2017/1938”), and particularly to Article 13 thereof,
Taking note of Recommendation (EU) 2018/177 of the European Commission, of 2 February 2018, on the elements to be included in the technical, legal and financial arrangements between Member States for the application of the solidarity mechanism under Article 13 of Regulation (EU) 2017/1938 of the European Parliament and of the Council concerning measures to safeguard the security of gas supply (hereinafter “the Recommendation (EU) 2018/177”),
Aiming to alleviate the effects of a severe emergency and to safeguard the supply of gas to the solidarity protected customers,
Considering that solidarity is needed to safeguard the security of gas supply in the European Union,
Have agreed as follows:
Article 1
Subject-matter and scope of the Agreement
1. This Agreement sets out the technical, legal and financial arrangements for the application of the solidarity mechanism pursuant to Article 13, paragraph (3), of the Regulation (EU) 2017/1938 and in accordance with the respective national legislation in force.
2. In case of activation of this Agreement, the Providing Party shall take necessary solidarity measures in its gas system in order to supply the solidarity protected customers in the gas system of the Requesting Party.
3. Solidarity obligations shall apply subject to the technically safe and reliable operation of the gas system of the Providing Party.
4. Solidarity measures shall be performed through voluntary measures, based on offers submitted by market players fixing the price for their curtailed supply share, or, where not sufficient, through additional mandatory measures, based on administrative measures authorised by the Providing Party.
Article 2
Definitions
For the purposes of this Agreement, the definitions in Article 2 of the Regulation (EU) 2017/1938, Article 2 of Regulation (EC) No 715/2009, Article 3 of Regulation (EU) 2017/459, Article 3 of Regulation (EU) No 312/2014, Article 2 of Regulation (EU) 2015/703 and Article 2 of Directive 2009/73/EC shall apply. Further to this, the following definitions shall apply:
a) “Solidarity measure” shall mean necessary measure in the gas system of the Providing Party, in accordance with Article 13 of the Regulation (EU) 2017/1938, by which the gas supply to customers other than solidarity protected customers is curtailed or suspended to the extent necessary and for as long as the gas supply to solidarity protected customers in the Requesting Party is not safeguarded. Solidarity measures shall not be detrimental to the operability and safety of gas and electricity systems of the involved Member States as provided for by Article 13, paragraph (1) of the Regulation (EU) 2017/1938.
b) “Voluntary measures” shall mean voluntary responses by the market participants to the call of the Providing Party to take measures on the supply and/ or demand side to provide volumes of gas in return for payment of a price determined by the market participant. These measures correspond to so called market-based measures referred to in Article 13 of the Regulation (EU) 2017/1938.
c) “Mandatory measures” shall mean administrative measures on the supply and demand side taken by the Providing Party in its own territory with a view to contributing to the gas supply of the solidarity protected customers of the Requesting Party. These measures correspond to so called non-market- based measures referred to in Article 13 of the Regulation (EU) 2017/1938.
Further specifications of mandatory measures applicable by the Croatian Competent Authority are based upon the mandatory measures provided by the Croatian legislation and Emergency Plan.
Further specifications of mandatory measures applicable by the Slovenian Competent Authority are based on the Slovenian legislation, valid plans for security of gas supply and emergency plans.
d) “Requesting Party” shall mean the Party asking for solidarity offers by submitting a solidarity request.
e) “Providing Party” shall mean the Party undertaking solidarity measures and submitting solidarity offers.
f) “Solidarity contracting party” shall mean one of the parties involved in the sale-purchase process related to the solidarity offer, defined in the solidarity offer and in the Declaration of acceptance.
g) “Solidarity request” shall mean the formal call by the Requesting Party to the Providing Party to provide a Solidarity offer.
h) “Solidarity offer” shall mean a set of market participants’ offers based upon voluntary measures or an offer based upon mandatory measures, provided by the Providing Party in line with this Agreement and the related Providing Party’s legislation.
i) “Market participants’ offers” shall mean offers of gas volumes for providing gas with reference to voluntary measures collected by the Solidarity contracting party of the Providing Party. Collection of offers by Solidarity contracting party could be made via IT interface or system, such as a dedicated platform, set under the respective national legislation.
j) “Declaration of acceptance” shall mean a written expression that the Requesting Party accepts the whole, or a part of the solidarity offer.
k) “Available transport capacities” shall be the available capacities at the time of delivery, taking into account technical restrictions and nominated capacities at the time of the solidarity offer.
l) “Emergency” or “emergency level” shall mean a crisis situation in line with Article 11, paragraph (1), letter (c) of the Regulation (EU) 2017/1938.
m) “Gas Coordination Group” shall mean the technical level body set up by Article 4 of the Regulation (EU) 2017/1938.
n) “Delivery day” shall mean the gas day within the meaning of Article 3, paragraph 16 of Commission Regulation (EU) 2017/459 on which the solidarity measures are to be used.
o) “TSO” shall mean transmission system operator.
Article 3
Solidarity request
1. The Solidarity request shall be dependent on the declaration of an emergency level pursuant to Article 11, paragraph (1), letter (c) of the Regulation (EU) 2017/1938 and the assurance by the Requesting Party that the preconditions of Article 13, paragraph (3) of the Regulation (EU) 2017/1938 are met at the time of the introduction of the requested solidarity measures.
2. The Competent Authority of the Requesting Party shall transmit the Solidarity request, as provided for in Article 15, to the contact point of the Competent Authority of the Providing Party. After having exhausted all market-based measures and all measures provided in its emergency plan, in accordance with Article 13, paragraph (3) of the Regulation (EU) 2017/1938, the Requesting Party may transmit the Solidarity request and shall notify this to the European Commission, including the description of the circumstances.
3. The Solidarity request shall include at least the following information:
– contact details of the Competent Authority of the Requesting Party;
– contact details of the relevant TSO of the Requesting Party;
– contact details of Solidarity Contracting Party, where different from TSO;
– volume of gas in MWh/d (considering three decimals) requested at Rogatec interconnection point;
– delivery day;
– assurance pursuant to paragraph 1 of this Article;
– recognition of the obligation of the Requesting Party to pay fair and prompt compensation for the solidarity in accordance with the provisions of this Agreement and Article 13, paragraph (8) of the Regulation (EU) 2017/1938.
4. To the extent that the security of gas supply situation allows, the Solidarity request shall be transmitted at least 20 hours before the beginning of the delivery day. It will only be possible to respond to the Solidarity requests made at shorter notice if the crisis situation and the necessary preparatory periods for the gas industry to be able to provide a Solidarity offer allows such response. In this case, the Providing Party’s Competent Authority shall undertake best efforts to arrange the Solidarity offer.
5. The Solidarity request shall be generally restricted to, and not exceed, the gas day that follows the gas day of its submission. Further Solidarity requests for subsequent gas days may be submitted, considering the deadlines in paragraph 4 of this Article.
6. Following the receipt of the solidarity request, the Competent Authority of the Providing Party shall give without delay confirmation to the Competent Authority of the Requesting Party. If the Requesting Party does not receive any confirmation within half an hour, it shall try to contact the Providing Party’s Competent Authority through any possible means.
Article 4
Form and Transmission of the Solidarity offers
1. The Solidarity offer shall include at least the following information:
– contact details of the Competent Authority of the Providing Party;
– contact details of the relevant TSO of the Providing Party;
– contact details of the Solidarity Contracting Party where different from the TSO;
– volume of gas in MWh/d (three decimals) to deliver at Rogatec interconnection point;
– delivery day;
– transport capacities at the Rogatec interconnection point for the offered volume;
– basis of the solidarity offer: voluntary or mandatory measures;
– costs of the solidarity measures as described in Article 12 in compliance with the provisions of the Regulation (EU) 2017/1938 and the Recommendation (EU) 2018/177 excluding cost of possible judicial proceedings;
– details of the recipients of payments, including the details of a clearing account, if applicable.
2. Where the deadline pursuant to Article 3, paragraph 4 of this Agreement is not met, the transmission of the Solidarity offer shall take place taking into account all necessary preparatory times for the gas industry. If the Providing Party’s Competent Authority is not able to submit a Solidarity offer by the end of the deadline, it shall inform the Requesting Party immediately, mentioning proper justification, and submit its offer as soon as possible.
3. The volume of gas contained in a single Solidarity offer shall be equal or lower than the volume of gas requested by the Requesting Party.
4. All Solidarity offers shall apply taking into proper account safety and reliability of involved gas systems, the physical constraint of the Rogatec interconnection point and its available capacity.
Article 5
Solidarity offer based upon voluntary measures
1. Following the receipt of a Solidarity request, the Providing Party’s Competent Authority shall transmit firstly a Solidarity offer based upon voluntary measures to the Requesting Party’s Competent Authority up to 16 hours before the beginning of the delivery day.
2. A Solidarity offer based upon voluntary measures shall contain gas volumes offered by the market participants willing to provide gas in order to sell gas to the Requesting Party, setting the price of their offered gas, any offers’ constraints (e.g. minimum acceptable quantities) and specifying Rogatec interconnection point as Delivery Point.
3. The Providing Party’s Competent Authority shall overview the legitimacy of the offers, in case of offer based upon voluntary measures, and check their sustainability and the compliance with the relevant legislation and regulatory acts thereto.
Article 6
Solidarity offer based upon mandatory measures
1. Solidarity offer based upon mandatory measures shall be submitted by a Providing Party when there are no more offers based upon voluntary measures to submit to the Requesting Party.
2. The Solidarity offer based upon mandatory measures shall be submitted up to 10 hours before the beginning of the delivery day.
3. The Solidarity offer based on mandatory measures shall contain the potentially available gas volumes effectively available within the time frame provided for in paragraph 2, taking into account the provisions foreseen in Article 2 paragraph 1 letter a), with pricing gas in compliance with Article 12, any offers’ constraints (e.g. minimum acceptable quantities), and including the necessary transport capacity to the Rogatec interconnection point as delivery point at the time of the provision of the Solidarity offer.
4. The Requesting Party, after the receipt of the Solidarity offer based upon mandatory measures, shall immediately confirm the receipt of the Solidarity offer and shall check that no other offer based upon voluntary measure, submitted by all possible EU Member States with which the gas system of the Requesting Party has an interconnection point or is connected through the gas system of a third country, according to Article 13 paragraph (2) of the Regulation (EU) 2017/1938, is available before accepting it.
5. If there are available Solidarity offers based upon voluntary measures regarding paragraph 4, the Requesting Party shall accept these offers before accepting any solidarity offer based upon mandatory measures.
6. When the Requesting Party receives no more solidarity offers based upon voluntary measures regarding paragraph 4, the Competent Authority of the Requesting Party may accept Solidarity offers based upon mandatory measures.
Article 7
Acceptance of Solidarity offers
1. The Requesting Party’s competent authority may accept the entire, or part of the Solidarity offer of the Providing Party within the constraints provided in Article 5 paragraph 2 and/or Article 6 paragraph 3, by transmitting a Declaration of acceptance to the Providing Party, using contact details specified in the Solidarity offer.
2. The Declaration of acceptance shall include the following information:
– contact details of the Competent Authority of the Requesting Party;
– contact details of the relevant TSO of the Requesting Party;
– contact details of the Solidarity contracting party, where different from the TSO, for withdrawing gas at the Rogatec interconnection point and for providing a payment including the details of a clearing account, if applicable;
– volume of gas in MWh/d (with three decimals) to deliver at Rogatec interconnection point;
– delivery day;
– commitment to fulfil all obligations agreed upon under this Agreement.
Article 8
Acceptance of the solidarity offer based upon voluntary measures
1. The acceptance of the Solidarity offer based upon voluntary measures shall only take place up to 14 hours before the beginning of the delivery day.
2. In order to accept the Solidarity offer based upon voluntary measures, the Requesting Party shall select one or more offers submitted by the Solidarity contracting party and transmit the Declaration of acceptance to the Providing Party’s Competent Authority within the deadline.
3. The Providing Party’s Competent Authority shall transmit the Declaration of acceptance immediately to its relevant Solidarity Contracting Party.
4. When the Declaration of acceptance is received by the Providing Party, a contract on gas purchase and delivery shall enter into force between the Solidarity contracting parties, based on the terms and conditions from this Agreement.
Article 9
Acceptance of the solidarity offer based upon mandatory measures
1. The Requesting Party shall decide on accepting the entire, or part of the Solidarity offer according to Article 6 paragraph 3.
2. The acceptance of the Solidarity offers based upon mandatory measures shall only take place up to 7 hours before the beginning of the delivery day. Solidarity offers not accepted within this period shall expire.
3. Solidarity offers pursuant to Article 4, paragraph 2 of this Agreement, can only be accepted within 2 hours from the receipt of the Solidarity offer, in any case 3 hours before the beginning of the delivery day. Solidarity offers not accepted within this period shall expire.
4. When the Declaration of acceptance is received by the Providing Party, a contract on gas purchase and delivery shall enter into force between the Solidarity contracting parties (entities) specified in the solidarity offer and entities, specified in the Declaration of acceptance and based on the terms and conditions from this Agreement.
5. On the basis of Declaration of acceptance, the Providing Party is obliged to undertake the necessary mandatory measures to ensure that the offered volumes of gas are available taking into account the physical constraint of the Rogatec interconnection point and its available capacity.
6. By accepting the Solidarity offer, the Requesting Party shall commit to fulfilling the compensation obligations pursuant to Article 13, paragraphs (8) and (10) of the Regulation (EU) 2017/1938 as laid down in accordance with Article 12 of this Agreement.
Article 10
Transmission and withdrawal of solidarity offer’s gas volume
1. The volume of gas offered within the Solidarity offer shall not exceed the volume technically available at Rogatec interconnection point (Delivery Point) taking into account booked and used capacity as well as the physical constraint of the Delivery Point and its available capacity and taking into account the provisions foreseen in Article 2 paragraph 1 letter a).
2. In case of an accepted the Solidarity offer, all necessary transport capacity within the Providing Party, to and at the Delivery Point is assumed as firm and provided by the Providing Party.
3. The Providing Party shall offer the gas quantities at Delivery Point (Providing Party side). The Requesting Party shall ensure that the volumes of gas provided are withdrawn at the Delivery Point (Requesting Party side). In particular, it shall ensure that the transport capacities necessary for withdrawal from the Delivery Point are available and booked in order to match the nomination at the Delivery Point.
4. With an aim to facilitate fulfilment of solidarity gas supply, respective TSO shall, if necessary, define technical provisions within their specific operational agreements, within six months after this Agreement is signed. The above provisions shall be submitted for the approval to the respective Competent Authority.
5. Irrespectively of the physical withdrawal of gas volume, the Requesting Party shall ensure the fulfilment of payment obligations deriving from the acceptance of the solidarity offer and delivered volume of gas at the Delivery Point (take or pay).
Article 11
Ending of solidarity supply
1. The obligation of the Providing Party to apply solidarity measures shall end when:
a) the European Commission finds, after a verification procedure in accordance with Article 11, paragraph (8), point 1 of the Regulation (EU) 2017/1938, that the declaration of the emergency is not or is no longer justified,
b) the end of the emergency is declared by the Requesting Party, or no other solidarity request is made in accordance with Article 3 of this Agreement for the gas day following the day on which the gas was supplied, or
c) the Member State acting as Providing Party in a solidarity offer can no longer supply its own solidarity protected customers.
2. In the cases of paragraph 1 letters a) and b) of this Article, the solidarity measure shall conclude at the end of the relevant delivery day for which a solidarity request was submitted in accordance with Article 3 of this Agreement. In the case of paragraph 1 letter c) of this Article, the Providing Party shall have the right to end the solidarity measure immediately after the already accepted offers and closed contracts for the present gas day have been fulfilled, and the Providing Party has informed the Requesting Party.
Article 12
Compensation
1. In the case of the Solidarity offer based upon voluntary measures, compensation for the contracted volume of gas delivered, pursuant to Article 13, paragraph (8), sentence 1 of the Regulation (EU) 2017/1938 shall be paid directly by Solidarity contracting party of the Requesting Party to the Solidarity contracting party of Providing Party and shall include:
a) gas price related to accepted solidarity offers from the market participants, and
b) transportation costs to the Rogatec interconnection point.
2. In case of the Solidarity offer based upon mandatory measures, compensation for the contracted volume of gas delivered, pursuant to Article 13, paragraph (8), sentence 1 of the Regulation (EU) 2017/1938, shall be paid directly by Solidarity contracting party of the Requesting Party to the Solidarity contracting party of Providing Party and shall generally – subject to paragraphs 3 and 4 of this Article – include:
a) the higher price between:
i. the unbalance gas price registered in the delivery day for users with short position in the Providing Party;
ii. the prices of the emergency measures that have been activated for the offered gas in the Providing Party;
b) compensation and reimbursement, which are not already included in the above price of the emergency measures (pursuant to letter a) of this paragraph), for damages to the Providing Party’s involved sectors of the economy affected by reductions in supply, including technical damages to gas storage facilities caused by an extraordinary utilization calculated in line with the same principles applied internally to the Providing Party, and
c) transportation costs to the Rogatec interconnection point.
3. When determining the appropriate compensation for the Solidarity offer based upon mandatory measures, the Parties shall ensure that compensation is paid in line with the same principles applying to the national crisis in the Member State of the Providing Party, if any. Each Party shall promptly inform the other Party on relevant statutory rules and its amendments.
4. The likely costs mentioned in the solidarity offer based upon mandatory measures shall not be exhaustive.
5. The request for compensating the costs arising pursuant to paragraph 2 letter b) of this Article and Article 13 of the Regulation (EU) 2017/1938, may be submitted with corresponding documentation following the conclusion of the Solidarity measures, within the deadlines provided by the Providing Party’s relevant legislation and regulatory acts.
6. In case judicial proceeding is filed according to Article 13 of the Regulation (EU) 2017/1938 in front of the courts, the Party in which that proceeding was filed, shall inform the other Party thereof.
Article 13
Methods of payment, invoicing and deadlines
1. For accepted offers, payments shall be fully undertaken within 15 calendar days following receipt of the invoice or interim invoice pursuant to paragraph 2 of this Article.
2. In the case of the Solidarity offer based upon mandatory measures, the Providing Party shall have the right to submit an interim invoice for the volumes of gas provided.
3. Payments shall be made in Euro and shall be made to or from a clearing account, if so specified, under Article 4, paragraph 1 or Article 7, paragraph 2.
4. Following the end of the solidarity measures, but no later than 12 months, the Parties shall agree on the need for and the time of transmission of the final invoice and of the request for payment for compensation pursuant to Article 12 of this Agreement. Costs arising from procedures pursuant to Article 13, paragraph (8), letter (c) of the Regulation (EU) 2017/1938 are not subject of that deadline.
5. Delayed payments shall be subject to interest payments from (and including) the payment date, pursuant to paragraph 1 of this Article, until and excluding the day of payment at the default interest rate. Here, “default interest rate” shall be the interest rate five-percentage points above the base rate of the European Central Bank.
Article 14
Compliance
The Parties shall take all necessary measures at national level and shall undertake the necessary actions in order to ensure compliance with their solidarity obligation and to ensure the implementation of this Agreement.
Article 15
Means of communication
1. Communications between the Parties shall primarily take place between Competent Authorities. Communication may take place in line with the contingent situation considering the spirit of cooperation required by the Regulation (EU) 2017/1938.
2. The Parties shall ensure that, if the contact details of the Competent Authority change, the contact details contained in the list of members of the Gas Coordination Group are updated and that the other Party is informed of this immediately.
3. Competent authorities of the Parties together prepare, and update when needed, communication forms for solidarity request, solidarity offer and Declaration of acceptance.
Article 16
Applicable law
This Agreement shall be implemented in accordance with the Croatian and Slovenian legislation, as well as applicable international law and the obligations arising from the Republic of Croatia's and the Republic of Slovenia’s membership of the European Union.
Article 17
Settlement of Disputes
1. Disputes concerning the interpretation or implementation of the present Agreement shall, as far as possible, be settled by the Competent Authorities of the two Parties.
2. If the dispute cannot thus be settled, each Party can appeal to the Court of Justice of the European Union. The decisions by the Court of Justice of the European Union shall be binding on the Parties.
3. If the Court of Justice of the European Union finds that a Party has failed to meet its obligations deriving from this Agreement or has violated the Agreement, the respective Party shall take the necessary measures deriving from the decision of the Court of Justice of the European Union within a deadline to be determined by the Court of Justice of the European Union.
4. Paragraphs 2 and 3 shall represent an arbitration Agreement between the Parties within the meaning of Article 273 TFEU.
Article 18
Entry into force
This Agreement shall enter into force on the date of receipt of the last of the two notifications by which the Parties inform each other, through diplomatic channels, that the internal legal procedures required for the entry into force of this Agreement have been completed.
Article 19
Validity and Termination
This Agreement shall remain in force unless one of the Parties notifies the other Party, in writing, of its intention to terminate the Agreement. This Agreement shall be terminated six months following the date of receipt of the notification of termination by the other Party. Termination is without prejudice to any pending obligations arising from this Agreement.
IN WITNESS WHEREOF the undersigned, being duly authorised thereto, have signed this Agreement.
Done at Zagreb on 14 July 2023 in two originals in the English language.
For the Government of the Republic of Slovenia Bojan Kumer (s)
For the Government of the Republic of Croatia Davor Filipović (s)