
Date: Wed, 4 Jul 2001 08:29:00 -0700 (PDT)
From: brendan.devlin@enron.com
To: peter.styles@enron.com
Subject: RE: Eu Liberalisation: Procedure and Substance of an Art 86(3)
Directive
Cc: paul.hennemeyer@enron.com, richard.shapiro@enron.com, paul.dawson@enron.com,
doug.wood@enron.com, nailia.dindarova@enron.com,
bruno.gaillard@enron.com
Bcc: paul.hennemeyer@enron.com, richard.shapiro@enron.com, paul.dawson@enron.com,
doug.wood@enron.com, nailia.dindarova@enron.com,
bruno.gaillard@enron.com

Paul is right and so am I. Legal unbundling is exactly what you say it is;
but that still entails a change of ownership, perhaps not ultimate ownership,
but at least structure (as you put it, a 'separate corporate entity'). If one
looks at the jurisprudence in the Transparency Directive Case, a requirement
to make accounts transparent and unbundled was OK, but by implication a
requirement to legally unbundle was not.

In passing, the Transparency Directive Case is the thing to mention if anyone
ever argues that nuclear power is not subject to State Aid rules. In that
case, the French argued that introducing transparency into EdF accounts would
contravene the Euratom treaty as EdF was a nuclear producer.  The Commission
wanted transparency in order to enforce the state aid rules under the EC
rules. France lost. The Court said that any entity that was supplying into a
commercial market was subject to the EC rules.  You often still see the myth
that nuclear power is outside the state aid rules.






