2023-12-29 08:24:55
Government take action to prevent the proliferation of millionaire frauds committed by pirate companies in the sale of fuel, which are harming rival companies that do comply with the law and also the prices paid by end customers. The Executive has taken advantage of the omnibus decree of economic measures approved this Wednesday by the Council of Ministers to include several reforms in the Hydrocarbons Law to put a stop to increasingly widespread irregular practices.
“Increasing fraudulent practices have been detected in the liquid hydrocarbons sector due to non-compliance with its sectoral obligations,” is highlighted in the text of the royal decree, in reference to the non-payments by many companies in the IVA or special taxes and the evasion in the payments of mandatory contributions to the Corporation of Strategic Reserves of Petroleum Products (Cores)to the Information System for the Biofuel Certification (SICBIOS) or the National Energy Efficiency Fund (FNEE).
The Ministry for the Ecological Transition, led by Vice President Teresa Ribera, understands that “the rapid transformation of the liquid hydrocarbons market in recent years makes an urgent review essential” of the sector law, given that business models have appeared that were not foreseen when the law and its subsequent amendments were drafted, and are not adequately regulated in current legislation.
“This has greatly facilitated fraud by some companies, which is harming the rest of the sector and which, in addition, has a direct impact on the consumer as it affects the final price of fuel,” the Government warns in the royal decree. Non-payments by certain companies “give them a competitive advantage over the rest of the operators that do comply with their obligationssomething that highlights the urgency of undertaking this regulatory review.”
The approved legal reform, among other aspects, reinforces the Ministry’s ability to sanction companies that do not pay these mandatory contributions or all taxes by withdrawing their official authorization as operators in the sector or taking urgent provisional measures before completing the file, for example. example by temporarily disabling them.
Focus on retail
The Government focuses on a new regulation of retail distributors of petroleum products, understanding that it is in this field where it is easiest to commit irregularities. On the one hand, from now on they are prohibited from supplying other distribution companies, acting de facto as wholesalers. The hydrocarbon law in its current wording allowed retail distributors to supply other distributors.
“When this measure was introduced in 2015, it was considered that it could have a favorable impact both on competition in the sector and on final consumer prices, since it represented an opening of the fuel supply market to both operators and distributors. However, in practice it has been proven that since 2015 the effect has been the opposite,” the Government argues.
On the other hand, a legal change is also introduced to clarify that not only wholesale companies are the ones that have access to pipeline networks or storage – as the current wording of the rule implied – but they also retail distributors use them and must also comply with the same obligations.
When the current Hydrocarbons Law was approved in 1998, wholesale operators were the only ones that made use of the logistics infrastructure and supplied the rest of the companies from tax warehouses. “The current wording of the law is being used, in one way or another, fraudulently by certain companies to skip the obligations that currently apply to the subjects that act in the sector, among them companies that, without being retail distributors in the terms that define[la ley] They also do not meet the requirements to be wholesale operators, although they are making this supply without assuming any of their sectoral obligations” for biofuel mixing or contributions to the national energy efficiency fund.
Additionally, the continuous increase in companies that carry out the activity of wholesale operators has been observed, which guarantees that the supply of petroleum products for subsequent retail distribution is guaranteed in our country under conditions of free competition, since currently There are more than one hundred and ten companies registered as wholesale operators. This situation is very different to what existed in 2015, with a much more limited number of wholesale operators in the market.
Oil company complaints
The oil companies have been raising the alarm about the existence of million-dollar fraud committed by ‘piracy’ companies in the sale of fuel. The complaint is persistent and comes from afar, the giants of the sector grouped in the AOP employers’ association (Repsol, Cepsa, BP, Galp or Saras) and the independent groups integrated into the UPI association have intensified their complaints in recent months.
In addition to police and Treasury operations against VAT fraud in the hydrocarbon sector, the Government recognizes that non-compliance with obligations in the use of biofuels is causing the different oil operators to have to make additional million-dollar contributions each year to the compensatory payments fund: more than 94 million euros last year, 72.5 million in 2021 or almost 62 million in 2020.
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