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Bloomberg: The Commission provides a solution with a directive on payments in rubles for natural gas

The European Union (EU) is preparing to address gas importers on a possible breach of sanctions on Russia, following a Putin decree requiring payments to be converted into rubles, according to a Bloomberg News report.

In particular, according to those familiar with the matter, in a new directive the European Commission will tell companies that they must make a clear statement that they consider their obligations fulfilled as soon as they pay in euros or dollars, as provided for in current contracts.

According to the same sources of the agency, the Commission informed the governments of the member states that this directive does not prevent companies from opening an account in Gazprombank and will allow them to buy gas without violating European sanctions.

It is recalled that on March 31, Russian President Vladimir Putin said that payments for gas should henceforth be made in rubles, otherwise exports would stop.

It was further clarified that the procedure will provide for the opening of a double account in Gazprombank, through which payments in euros or dollars will be made as provided in the contracts in force, but will be converted internally in the bank in rubles.

The EU initially said Putin’s payment mechanism was in breach of existing contracts, but largely bypassed sanctions imposed on Moscow.

However, according to the report, at a closed-door meeting on Friday, the Commission told member states that its updated directive would clarify that companies could open a euro or dollar account with Gazprombank, as requested by the Kremlin.

However, Bloomberg points out that the Commission has not determined whether the existence of an account in rubles – as provided by the Russian decree – is in line with EU regulations.

Previously, officials had unofficially argued that opening such an account would violate sanctions. According to the agency’s sources, the updated directive, as presented in the Member States, fails to address this point.

Another key point in the directive is that once European companies make a payment in euros or dollars and declare that their obligation has been completed, no further payment action should be required from the Russian side.

Friday’s meeting found the governments divided, according to one of the people who spoke to Bloomberg on condition of anonymity.

While Germany, Hungary, Italy and France generally approved the Commission’s plan, Poland said it was failing to provide legal clarity and asked to be referred to EU ambassadors. Other states were confused by the lack of a specific directive opening accounts in rubles.

Germany said at the meeting that it had consulted its companies on the proposal and received positive feedback, the source added. Berlin also clarified that EU sanctions do not prohibit the opening of multiple accounts with Gazprombank.

Source: Capital

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