1. 1 This project is supported by the European Union 3 rd MEDREG-IMME Seminar Reform and Opening of Maghreb Electricity Markets 11-12 September 2013 MRA (Malta)

2. 2 This project is supported by the European Union Market opening: does away with at least one of the reasons for market regulation, but it does not obviate all of them. Some social policy objectives (protection of vulnerable consumers, ensure continuity of service or guarantee universal service provision, monitoring of customer switching) not achievable through liberalisation, market imperfections may be deteriorated. E.g. increase in cross-border exchanges assists the transmission of systemic risk or of other negative influences from one market to another.

3. 3 This project is supported by the European Union Competition: exerts a constraint on previously legal monopolies on their right to exercise monopoly power, increases diversity of choice and raises service quality. Regulatory goals need adjustment to the degree of competition that prevails in the market and the sources of market distortions. If the source of distortion is outside the jurisdiction of a regulatory authority, international cooperation is necessary.

4. 4 This project is supported by the European Union Regulatory cooperation is vital in open and integrated markets. It also increases regulatory standing and accountability because in effect it facilitates sharing of best practices, knowledge sharing learning and improvement of regulatory techniques and subjects regulators to peer assessment.

5. 5 This project is supported by the European Union Articles 35(4) of the EU Electricity Directive and 39(4) of the EU Gas Directive provide for the following: ‘Member States shall guarantee the independence of the regulatory authority and shall ensure that it exercises its powers impartially and transparently’

6. 6 Three principles are involved here: Independence: Article 35(4)(a) of the Electricity Directive and Article 39(4)(a) of the Gas Directive, ‘the regulatory authority is legally distinct and functionally independent from any other public or private entity’ when carrying out the regulatory tasks conferred upon it by the Electricity and Gas Directives. Independence in the new legislation concerns not only the electricity and gas industry but also any other public body (including national, local or regional government, municipalities and political organisations or structures) or private body. Legally distinct means that the energy regulator must be created as a separate and distinct legal entity from any Ministry or other government body. This provision is closely linked to the requirement that the energy regulator should be able to take autonomous decisions.

7. 7 This project is supported by the European Union Consequences: Ex ante : Requirement of independence excludes any interference from the government or any other public or private entity prior to a decision. It also implies that if the energy regulator is to draft a work programme for the coming year(s), it should be able do so autonomously, i.e. without the need for the approval or consent of public authorities or any other third parties. This does not discharge the energy regulator from complying with the Government’s energy policy. Ex post: Decisions of the energy regulator are immediately binding and directly applicable without the need for any formal or other approval or consent of another public authority or any other third parties. And cannot be subject to review, suspension or veto by the government or the Ministry. This, of course, precludes neither judicial review nor appeal mechanisms before any other bodies independent of the parties involved and of any government.

8. 8 This project is supported by the European Union Highly important to lay down clear rules for the setting- up a term for the Board, with regards to nomination of individuals and renewal of term of office. The terms need to be relatively long (i.e. 4 to 5 years or more) and the nomination should come from the highest level of political authority.

9. 9 This project is supported by the European Union Impartiality: Aimed at guaranteeing that the energy regulator acts and takes decisions in a neutral way, based on objective criteria and methodologies. Requires dissuasive civil, administrative and/or criminal sanctions in case of violations of the provisions on impartiality.

10. 10 This project is supported by the European Union Transparency: Energy regulator must publish rules of procedure. These should include at least procedures for decision making. Compliance with the transparency requirement also means that the regulator must have clear contact points for all stakeholders and publish information on own organisation and structure. It must also consult stakeholders before taking important decisions. Must have clear public consultation procedure. At least include publishing documents ahead of public consultations and organising public hearings.

11. This project is supported by the European Union 11 Thank you for your kind attention