French gas customers face a real risk from a No Deal Brexit
Much is reported in the press on the UK government’s struggle to negotiate the withdrawal agreement, and the main focus as we approach the deadline has been on the potential impact of a so-called No Deal Brexit on the UK economy.
French energy law specifies that only companies based in the EU have the authorisation to supply gas in France; unless a specific agreement can be reached on this issue before the withdrawal date, all shippers on the French network based in the UK will, on 30th March, automatically lose their authorisation to supply gas in France. This situation concerns some 10 or so shippers who set up their trading desks in the UK, as the British fiscal regime was far more conducive to their activities than that in France.
The French State is not willing, nor is it able, to fast track a change in the law to accommodate UK companies post-Brexit. The current situation shows how much still needs to be done, because the consequences are potentially major as the amount of gas ‘at risk’ is possibly up to 40 per cent of demand.