Consideration of the case on the constitutionality of the specific provision of the Procedure for organisation and holding exchange auctions for sale of crude oil, gas condensate of own production and the liquefied gas
09/24/2020
On September 24, the Grand Chamber of the Constitutional Court of Ukraine at the plenary session in the form of written proceedings considered the case upon the constitutional petition of 51 People’s Deputies of Ukraine on compliance with the Constitution of paragraph 51.3 of the Procedure for organisation and holding exchange auctions approved by the Resolution of the Cabinet of Ministers of Ukraine “On the organisation and holding of exchange auctions for sale of crude oil, gas condensate of own production and liquefied gas” dated October 16, 2014 No. 570 as amended (hereinafter referred to as the Procedure).
During the court hearing, Judge-Rapporteur in the case Oleksandr Tupytskyi informed about the content of the constitutional petition and the grounds for initiating constitutional proceedings.
In particular, the Judge-Rapporteur noted that in accordance with paragraph 51.3 of the Procedure, the seller fulfills his/her obligations to supply crude oil, gas condensate and liquefied gas after receipt of funds from the buyer in full in accordance with the terms of the contract of sale.
According to Oleksandr Tupytskyi, the constitutional petition states that the disputed provision establishes the legal regime of ownership of these types of raw materials, in particular, the procedure and conditions for acquiring ownership of these objects. The authors of the petition believe that having settled the legal relations, which should be determined exclusively by the laws of Ukraine, the Cabinet of Ministers of Ukraine has gone beyond its powers. The People's Deputies of Ukraine also point out that the disputed provisions of the bylaw establish unequal competitive conditions for oil and gas market participants.
According to them, the Government has set a requirement for other participants in the oil and gas market, who as buyers participate in the same auctions, to pay in full in advance for these raw materials. In this way, the Cabinet of Ministers of Ukraine violated its constitutional obligation to ensure equal conditions for the development of all forms of ownership, creating a privileged position for the state-owned company and unequal competitive conditions for other market participants.
The Judge-Rapporteur also said that in order to ensure full and objective consideration of the case and the Court's decision, inquiries were sent to the President of Ukraine, the Verkhovna Rada of Ukraine, the Cabinet of Ministers of Ukraine, a number of scientific institutions, the Association of Gas Companies of Ukraine and the Oil and Gas Association of Ukraine with a request to express positions on the issues raised in the constitutional petition.
After examining the case files in public part of plenary session, the Court proceeded to the in-camera part of the plenary session for a decision.
The public part of the plenary session is available on the official website of the Constitutional Court of Ukraine at the link: http://ccu.gov.ua/kategoriya/2020.
