Court of Justice of the European Communities (including Court of First Instance Decisions)

Provisional text

OPINION OF ADVOCATE GENERAL

RANTOS

delivered on 7 September 2023 (1)

Case C‑371/22

G sp. z o.o.

v

W S.A.

(Request for a preliminary ruling from the Sąd Okręgowy w Warszawie (Regional Court, Warsaw, Poland))

(Reference for a preliminary ruling – Internal electricity market – Directive 2009/72/EC – Article 3(5) and (7) – Consumer protection – Right of the customer, while respecting contractual conditions, to be able easily to switch to a new supplier – Fixed-term, fixed-price electricity supply contract entered into by a small enterprise – Contractual penalty for early termination of the contract – Amount of the penalty corresponding to the price of the electricity not consumed before the original term of the contract – National legislation allowing termination ‘without bearing costs and damages other than those resulting from the contract’)

I.      Introduction

1.        Directive 2009/72/EC, (2) which establishes common rules for the internal market in electricity, provides, in Article 3(5) and (7), that where an electricity customer, while respecting contractual conditions, wishes to change supplier, it must be granted this right in a non-discriminatory manner as regards cost, effort or time, and it must in fact be able easily to switch to a new supplier.

2.        Is a contractual penalty charged to a small enterprise by its previous supplier for terminating a fixed-term, fixed-price electricity supply contract early with a view to switching supplier, the amount of which corresponds to the price of the electricity not consumed before the original term of the contract, compatible with the customer’s right to be able in fact easily to switch to a new supplier within the meaning of Article 3(5) and (7) of that directive? This, in essence, is the question referred for a preliminary ruling by the Sąd Okręgowy w Warszawie (Regional Court, Warsaw, Poland).

3.        The request for a preliminary ruling was made in the context of a dispute between G sp. z o.o., an enterprise with fewer than 50 occupied persons (‘G’), and W S.A., an electricity supplier (‘W’), concerning the payment of a contractual penalty for early termination of the electricity supply contract between the two parties.

4.        This case will require the Court of Justice to give a ruling, for the first time, on the interpretation of Article 3(5) and (7) of Directive 2009/72. To answer the question, it will be necessary to balance, in the context of the proper functioning of the internal electricity market, the customer’s right to be able in fact easily to switch to a new supplier and the right for the previous supplier to obtain compensation for the non-consumption of electricity that the customer had undertaken to purchase from it under a fixed-term, fixed-price contract.

II.    Legal framework

A.      European Union law

1.      Directive 2009/72

5.        According to recitals 1, 3, 42, 52 and 57 of Directive 2009/72:

‘(1)      The internal market in electricity, which has been progressively implemented throughout the Community since 1999, aims to deliver real choice for all consumers of the European Union, be they citizens or businesses, new business opportunities and more cross-border trade, so as to achieve efficiency gains, competitive prices, and higher standards of service, and to contribute to security of supply and sustainability.

…

(3)      The freedoms which the Treaty guarantees the citizens of the Union – inter alia, the free movement of goods, the freedom of establishment and the freedom to provide services – are achievable only in a fully open market, which enables all consumers freely to choose their suppliers and all suppliers freely to deliver to their customers.

…

(42)      All Community industry and commerce, including small and medium-sized enterprises, and all citizens of the Union that enjoy the economic benefits of the internal market should also be able to enjoy high levels of consumer protection, and in particular household customers and, where Member States deem it appropriate, small enterprises should also be able to enjoy public service guarantees … Those customers should also have access to choice, fairness, representation and dispute settlement mechanisms.

…

(52)      Clear and comprehensible information should be made available to consumers concerning their rights in relation to the energy sector. …

…

(57)      Promoting fair competition and easy access for different suppliers and fostering capacity for new electricity generation should be of the utmost importance for Member States in order to allow consumers to take full advantage of the opportunities of a liberalised internal market in electricity.’

6.        Article 1 of that directive, headed ‘Subject matter and scope’, provides:

‘This Directive establishes common rules for the generation, transmission, distribution and supply of electricity, together with consumer protection provisions, with a view to improving and integrating competitive electricity markets in the Community. It lays down the rules relating to the organisation and functioning of the electricity sector, open access to the market, the criteria and procedures applicable to calls for tenders and the granting of authorisations and the operation of systems. It also lays down universal service obligations and the rights of electricity consumers and clarifies competition requirements.’

7.        Article 2 of that directive, entitled ‘Definitions’, provides, in paragraphs 7, 9 to 12 and 19:

‘For the purposes of this Directive, the following definitions apply:

…

7.      “customer” means a wholesale or final customer of electricity;

…

9.      “final customer” means a customer purchasing electricity for his own use;

10.      “household customer” means a customer purchasing electricity for his own household consumption, excluding commercial or professional activities;

11.      “non-household customer” means a natural or legal persons purchasing electricity which is not for their own household use and includes producers and wholesale customers;

12.      “eligible customer” means a customer who is free to purchase electricity from the supplier of his choice within the meaning of Article 33;

…

19.      “supply” means the sale, including resale, of electricity to customers’.

8.        Article 3 of the same directive, entitled ‘Public service obligations and customer protection’, states, in paragraphs 3 to 5 and 7 thereof:

‘3.      Member States shall ensure that all household customers, and, where Member States deem it appropriate, small enterprises (namely enterprises with fewer than 50 occupied persons and an annual turnover or balance sheet not exceeding EUR 10 million), enjoy universal service, that is the right to be supplied with electricity of a specified quality within their territory at reasonable, easily and clearly comparable, transparent and non-discriminatory prices. …

4.      Member States shall ensure that all customers are entitled to have their electricity provided by a supplier, subject to the supplier’s agreement, regardless of the Member State in which the supplier is registered, as long as the supplier follows the applicable trading and balancing rules. …

5.      Member States shall ensure that:

(a)      where a customer, while respecting contractual conditions, wishes to change supplier, the change is effected by the operator(s) concerned within three weeks …

…

Member States shall ensure that the rights referred to in points (a) and (b) are granted to customers in a non-discriminatory manner as regards cost, effort or time.

…

7.      Member States shall take appropriate measures to protect final customers, and shall, in particular, ensure that there are adequate safeguards to protect vulnerable customers. In this context, each Member State shall define the concept of vulnerable customers which may refer to energy poverty and, inter alia, to the prohibition of disconnection of electricity to such customers in critical times. Member States shall ensure that rights and obligations linked to vulnerable customers are applied. In particular, they shall take measures to protect final customers in remote areas. They shall ensure high levels of consumer protection, particularly with respect to transparency regarding contractual terms and conditions, general information and dispute settlement mechanisms. Member States shall ensure that the eligible customer is in fact able easily to switch to a new supplier. As regards at least household customers those measures shall include those set out in Annex I.’

9.        Article 33 of Directive 2009/72, entitled ‘Market opening and reciprocity’, is worded as follows in paragraph 1:

‘Member States shall ensure that the eligible customers comprise:

…

(c)      from 1 July 2007, all customers.’

10.      Annex I to this directive, entitled ‘Measures on consumer protection’, states, in point 1:

‘Without prejudice to Community rules on consumer protection, in particular Directive 97/7/EC of the European Parliament and of the Council of 20 May 1997 on the protection of consumers in respect of distance contracts ^[(3)^] and Council Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts ^[(4)^], the measures referred to in Article 3 are to ensure that customers:

(a)      have a right to a contract with their electricity service provider that specifies:

…

–        the duration of the contract, the conditions for renewal and termination of services and of the contract and whether withdrawal from the contract without charge is permitted,

…

Conditions shall be fair and well-known in advance. In any case, this information should be provided prior to the conclusion or confirmation of the contract. …

…

(e)      are not charged for changing supplier; …’

11.      Directive 2009/72 was repealed and replaced, with effect from 1 January 2021, by Directive (EU) 2019/944, (5) pursuant to the first paragraph of Article 72 thereof.

2.      Directive 2019/944

12.      Article 2 of Directive 2019/944, entitled ‘Definitions’, provides, in paragraphs 16 to 18:

‘For the purposes of this Directive, the following definitions apply:

…

(16)      “contract termination fee” means a charge or penalty imposed on customers by suppliers or market participants engaged in aggregation, for terminating an electricity supply or service contract;

(17)      “switching-related fee” means a charge or penalty for changing suppliers or market participants engaged in aggregation, including contract termination fees, that is directly or indirectly imposed on customers by suppliers, market participants engaged in aggregation or system operators;

(18)      “aggregation” means a function performed by a natural or legal person who combines multiple customer loads or generated electricity for sale, purchase or auction in any electricity market’.

13.      Article 12 of that directive, entitled ‘Right to switch and rules on switching-related fees’, provides, in paragraphs 2 and 3:

‘2.      Member States shall ensure that at least household customers and small enterprises are not charged any switching-related fees.

3.      By way of derogation from paragraph 2, Member States may permit suppliers or market participants engaged in aggregation to charge customers contract termination fees where those customers voluntarily terminate fixed-term, fixed-price electricity supply contracts before their maturity, provided that such fees are part of a contract that the customer has voluntarily entered into and that such fees are clearly communicated to the customer before the contract is entered into. Such fees shall be proportionate and shall not exceed the direct economic loss to the supplier or the market participant engaged in aggregation resulting from the customer's termination of the contract, including the costs of any bundled investments or services that have already been provided to the customer as part of the contract. The burden of proving the direct economic loss shall be on the supplier or market participant engaged in aggregation, and the permissibility of contract termination fees shall be monitored by the regulatory authority, or by an other competent national authority.’

B.      Polish law

14.      The ustawa – Prawo energetyczne (Law on Energy) of 10 April 1997, (6) in the version applicable to the dispute in the main proceedings (‘the Law on Energy’), states, in Article 4j(3a):

‘An end customer may terminate a fixed-term contract pursuant to which the energy undertaking supplies gaseous fuel or energy to that customer, without bearing costs and damages other than those resulting from the contract, by submitting a written statement to the energy undertaking.’

15.      The ustawa – Kodeks cywilny (Law establishing the Civil Code) of 23 April 1964, (7) in the version applicable to the main proceedings (‘the Civil Code’), provides, in Article 483(1):

‘The contract may stipulate that compensation for damage arising from non-performance or improper performance of a non-pecuniary obligation is to be effected by payment of a fixed sum (contractual penalty).’

16.      Article 484 of the Civil Code states:

‘§1.      In the event of non-performance or improper performance of an obligation a contractual penalty is due to the creditor in the amount stipulated for such an event, irrespective of the amount of the damage suffered. A claim for damages exceeding the amount of the penalty provided for is not admissible, unless the parties have agreed otherwise.

§2.      If a substantial part of the obligation has been performed, the debtor may request a reduction of the contractual penalty; the same applies if the contractual penalty is manifestly excessive.’

III. The dispute in the main proceedings, the questions referred for a preliminary ruling and the procedure before the Court

17.      On 1 January 2010, G, a small enterprise governed by Polish law with fewer than 50 occupied persons, (8) entered into a fixed-term, fixed-price general contract with the supplier W under which W undertook to supply electricity to an agro-tourism farm in K. (Poland) (‘the contract at issue’).

18.      On 23 February 2015, G and W entered into an agreement whereby G undertook to maintain the contract at issue at least until 31 December 2016. Under the terms of that agreement, the parties agreed that they could terminate the contract at issue subject to six months’ notice from the date of notification of the termination, which would take effect at the end of the calendar year. In addition, if G terminated the contract early, W could request payment of a sum corresponding to the price of the electricity not consumed before the original term of the contract (‘the contractual penalty’). (9)

19.      On 30 January 2015, G entered into a supply contract with Z S.A., another electricity supplier (‘Z’), for the same agro-tourism farm. On 25 February 2015, Z, acting on the authority given to it by G, informed W that the new contract had been entered into and, in case W failed to consent to the change, gave notice of termination of the contract at issue.

20.      On 9 March 2016, W sent G a debit note for the amount of PLN 63 959.70 (around EUR 15 372 at the date of the request), (10) by way of a contractual penalty. Payment was due by 23 March 2016. Since G did not arrange payment by that date, on 21 November 2016, W brought an action before the Sąd Rejonowy dla m. st. Warszawy w Warszawie (District Court for the Capital City of Warsaw in Warsaw, Poland) requesting that G be ordered to pay it the abovementioned sum by way of a contractual penalty, plus statutory interest calculated from 24 March 2016 until the date of payment.

21.      By judgment of 7 February 2020, the District Court upheld that action. It concluded inter alia that, after G switched electricity supplier, the contract at issue had been terminated early, which allowed W to request payment of the contractual penalty under Article 483(1) of the Civil Code. In that respect, the District Court held that, under Article 484(1) of the Civil Code, the contractual penalty claimed by the supplier was not subject to proof of the existence of damage and that the penalty had been provided for in the contract at issue in the event of a change of supplier, the amount of the penalty corresponding to the stipulations of the contract.

22.      G brought an appeal against that judgment before the Sąd Okręgowy w Warszawie (Regional Court, Warsaw), the referring court, claiming, inter alia, that, in accordance with Article 3(5) of Directive 2009/72, it should not have been charged the contractual penalty. G further submitted that W had not suffered any actual damage, but had only lost the advantage it could have obtained, corresponding to the volume of electricity it had declared it would purchase. For its part, W contended that, pursuant to Article 484(1) of the Civil Code, the amount of a contractual penalty is independent of the amount of damage suffered.

23.      In the first place, the referring court notes that, pursuant to Article 4j(3a) of the Law on Energy, a final customer may terminate a fixed-term energy supply contract without bearing costs and damages other than those resulting from the contract. That law does not lay down any criteria regarding the calculation of such costs and damages, in so far as it does not include any reference to their proportionality, and does not rule out the possibility of claiming flat-rate compensation. In accordance with their freedom to contract, the parties may set the costs and damages relating to the early termination of an electricity supply contract, including any contractual penalty. According to the Civil Code, the penalty is payable to the creditor for the amount agreed for that purpose, regardless of the extent of the damage suffered. It may not be reduced by a national court of its own motion, since the claimant party bears the burden of proof and must demonstrate that the amount of the penalty was excessive. Since Article 4j(3a) of the Law on Energy makes no reference to consumer protection, the referring court points out that the fairness of a contractual penalty as regards small enterprises cannot be examined. Furthermore, that law does not provide for the possibility of automatically reducing a contractual penalty for business customers.

24.      The referring court questions whether the national legislation complies with EU law since, according to Article 3(5) of Directive 2009/72, Member States must ensure that the right to change electricity supplier is granted to customers in a non-discriminatory manner as regards cost, effort or time. In addition, although paragraph 7 of that article provides that the eligible customer must in fact be able easily to switch to a new supplier, and thus indicates the need to maintain adequate proportionality to costs, that provision does not mention penalties or damages. If a financial disadvantage is imposed on the consumer, the extent of that disadvantage should not constitute a means of discriminating against other electricity suppliers, which would result in the customer being unable in fact to switch supplier.

25.      The referring court adds that, while Directive 2009/72 is applicable ratione temporis to the dispute in the main proceedings, Directive 2019/944, which replaced it, provided clarification as to the right freely to change electricity supplier, which is relevant for the interpretation of the earlier directive. In that respect, the referring court cites Articles 4 and 12(3) of Directive 2019/944, according to which, if a small enterprise is charged fees as a result of switching electricity supplier, such fees must be proportionate and must not exceed the direct economic loss to the supplier or the market participant engaged in aggregation resulting from the customer’s termination of the contract.

26.      The referring court concluded that the possibility of charging a contractual penalty, as provided for by national law, regardless of the extent of the damage suffered, without clear and precise criteria for calculating that penalty, could nullify the aim of protection referred to in Article 3(5) and (7) of Directive 2009/72 and Article 12(3) of Directive 2019/944, thereby restricting the customer’s freedom to terminate its electricity supply contract.

27.      In the second place, the referring court examines the possibility of an electricity supplier contractually imposing fees on a customer for terminating the contract before maturity, when those fees correspond de facto to the costs of the electricity not consumed before the original term of the contract, taking into account the aim pursued by Directive 2009/72 to be able easily to switch to a new supplier in a non-discriminatory manner and the need to respect the principle of proportionality. In that regard, the referring court considers that Article 12(3) of Directive 2019/944 provides useful guidance on the interpretation of Article 3(5) and (7) of Directive 2009/72 by not ruling out the possibility of imposing fees, provided they are proportionate. The referring court questions the legality of contractual provisions stipulating that the fees related to the early termination of a fixed-term contract correspond to a debt equivalent to the amount of electricity not consumed, which the customer potentially could have used during the remaining term of the contract, and whether it is possible to calculate such costs with reference to a ‘take-or-pay’ type clause. The same court questions whether such a mechanism would, in essence, have the effect of hindering an effective change of electricity supplier. If the amount of the contractual penalty corresponds to the cost of the electricity not consumed before the original term of the contract, the early termination of the contract would have a consequence for the customer comparable to that of the continuation of the contractual relationship with the supplier. In such a situation, a customer wishing to terminate the contract would still probably choose to maintain the contractual relationship he or she considers unfavourable and the supplier would be assured of deriving a financial advantage from it for the entire term of the contract. Such a penalty would be tantamount to imposing the entire financial risk of terminating the contract on the customer and thus would be manifestly excessive.

28.      The referring court notes that, at the same time, when it gets a new customer, the electricity supplier incurs various costs, such as the cost of purchasing electricity. The question arises therefore of how to calculate the direct economic loss to an electricity supplier in the event of a customer terminating the contract early – in other words, whether to take into account the price of the electricity used, or to include the price of the supply of the electricity transmission or distribution service. In that respect, to avoid the allegation of discretionary and arbitrary application, while ensuring a fair distribution of the burden of proof, and to ensure that the national legislation complies with Directive 2009/72, it is suggested that it is necessary to examine whether the method for calculating the costs related to the early termination of a fixed-term, fixed-price electricity supply contract should be expressly provided for in the Law on Energy.

29.      In those circumstances, the Sąd Okręgowy w Warszawie (Regional Court, Warsaw) decided to stay the proceedings and to refer the following questions to the Court of Justice for a preliminary ruling:

‘(1)      Must Article 3(5) and (7) of Directive [2009/72], which requires that the rights of an energy customer (small undertaking), in the event of a change of energy supplier, be exercised in accordance with the rule ensuring that the eligible customer is in fact able easily to switch to a new supplier, and that that change be made in a non-discriminatory manner as regards cost, effort or time, be interpreted as precluding the possibility of imposing a contractual penalty on an energy customer for terminating a fixed-term energy supply contract where the energy customer wishes to change energy supplier, irrespective of the amount of loss suffered (Articles 483(1) and 484(1) and (2) of the [Civil Code]) and without any criteria being laid down in the Law on Energy [Article 4j(3a)] for the charging of such fees or the establishment thereof?

(2)      Must Article 3(5) and (7) of Directive [2009/72], which requires that the rights of an energy customer (small undertaking), in the event of a change of energy supplier, be exercised in a non-discriminatory manner as regards cost, effort or time and in accordance with the rule ensuring that the eligible customer is in fact able easily to switch to a new supplier, be interpreted as precluding an interpretation of contractual clauses which, in the event of early termination of an energy supply contract concluded with a supplier for a fixed term, makes it possible to charge consumers (small undertakings) fees corresponding de facto to the cost of the energy not consumed before the [initial] end of the contract in accordance with the take-or-pay rule?’

30.      The Polish and Greek Governments and the European Commission submitted written observations to the Court.

IV.    Analysis

31.      By its two questions referred for a preliminary ruling, which should be examined together, the referring court asks, in essence, whether Article 3(5) and (7) of Directive 2009/72 must be interpreted as precluding national legislation according to which, where a small enterprise terminates a fixed-term, fixed-price electricity supply contract early with a view to switching supplier, that undertaking may be required to pay a contractual penalty in a situation where, under that legislation, the penalty is due regardless of the extent of the loss incurred by the previous supplier, and even though that legislation does not lay down any criteria for the calculation or reduction of the penalty and allows the amount of the penalty to correspond to the price of the electricity not consumed before the original term of the contract.

32.      In this case, it is clear from the order for reference that G is a small enterprise which entered into the contract at issue for the purpose of supplying electricity to an agro-tourism farm. On 9 March 2016, under the terms of the contract, W demanded that G pay a contractual penalty for terminating the contract early with a view to switching supplier. The amount of the penalty corresponded to the price of the non-consumed electricity that G had undertaken to purchase from it until the end of that contract. As the referring court points out, the national legislation allows a fixed-term contract to be terminated without incurring costs and damages other than those resulting from the contract, without specifying the criteria to be taken into account for their calculation, nor providing for the possibility of automatically reducing a penalty, except at the request of the party concerned, who would bear the burden of proving the excessive nature of the penalty. In addition, under the national legislation, the amount of a contractual penalty is not contingent on the amount of loss suffered. The referring court seeks to ascertain whether such legislation complies with Article 3 of Directive 2009/72, which determines, inter alia, the obligations of the Member States with regard to consumer protection, (11) in particular paragraphs 5 and 7 of that article, which have not yet been interpreted by the Court of Justice.

33.      As a preliminary point, it should be borne in mind that, in accordance with settled case-law, the interpretation of a provision of EU law requires that account be taken not only of its wording, but also of its context and the objectives and purpose pursued by the act of which it forms part. (12)

34.      In this context, in the first place, as regards the wording of the provisions referred to, Article 3(5)(a) of Directive 2009/72 states that Member States shall ensure that, where a customer, ‘while respecting contractual conditions’, wishes to change supplier, the change is effected by the operator(s) concerned within three weeks (13) and that this right is granted to customers in a non-discriminatory manner as regards cost, effort or time. In addition, paragraph 7 of that article, in addition to primarily and specifically targeting ‘vulnerable consumers’, provides, more generally, that Member States must ensure high levels of consumer protection, particularly with respect to transparency regarding contractual terms and conditions, and ensure that the ‘eligible customer’ is ‘in fact able easily to switch to a new supplier’. Paragraph 7 also states that ‘as regards at least household customers’, those measures must include those set out in Annex I to the directive.

35.      Under Article 2(12) of Directive 2009/72, ‘eligible customer’ means a customer who is free to purchase electricity from the supplier of his or her choice within the meaning of Article 33 of the directive. According to Article 33(1)(c), from 1 July 2007, the concept of ‘eligible customer’ includes ‘all customers’. Therefore, Member States are required to ensure that all customers, including a small enterprise, regardless of their vulnerability, are in fact able to switch electricity suppliers easily.

36.      It is thus clear from the terms of Article 3(5) and (7) of Directive 2009/72 that the customer of an electricity supplier must be protected when he or she wishes to switch supplier. At the same time, although those provisions do not explicitly mention that the previous supplier may demand payment of a contractual penalty for early termination of the contract, let alone indicate the criteria used to calculate the amount of that penalty, Article 3(5)(a) states that the contractual conditions must be respected.

37.      Accordingly, I do not think that the wording of Article 3(5) and (7) of Directive 2009/72 can, in principle, preclude an electricity supply contract from providing for the customer to be charged a contractual penalty in the event of early termination of a fixed-term, fixed-price contract because the customer wishes to switch to a new supplier. Nevertheless, according to those provisions, the amount of that penalty must not deprive the customer of the possibility of being in fact able easily to switch to a new supplier.

38.      In the second place, regarding the context of Article 3(5) and (7) of Directive 2009/72, it should be noted, first, that the last sentence of Article 3(7) refers to the consumer protection measures listed in Annex I to that directive, which Member States must adopt as regards ‘at least’ household customers. Annex I provides, in particular, in point 1(a), that customers have a right to a contract with their electricity service provider that specifies whether withdrawal from the contract without charge is permitted. In addition, according to that provision, the terms of the contracts must be fair and well known in advance, and in any case, this information should be provided prior to the conclusion or confirmation of the contract. Point 1(e) of the annex states that customers should not be charged for changing supplier. It is thus apparent from those provisions that, ‘as regards at least household customers’, they do not bear any costs when they change electricity supplier, including when the supply contract is for a fixed term and a fixed price.

39.      In the present case, it is not disputed that G falls within the concepts of ‘customer’, ‘final customer’ and ‘eligible customer’, as defined in Article 2(7), (9) and (12), respectively, of Directive 2009/72, as well as the concept of ‘non-household customer’, defined in paragraph 11 of that article to mean a natural or legal person purchasing electricity which is not for their own household use. It is clear in fact from the order for reference that G, who entered into the contract at issue for the purpose of supplying an agro-tourism farm, acted in the course of its trade, business or profession. (14)

40.      At the same time, G does not fall within the concept of ‘household customer’ within the meaning of Article 2(10) of Directive 2009/72, defined as a customer purchasing electricity for his or her own household consumption. Furthermore, it is not apparent from the order for reference that the Republic of Poland intended to extend the scope of Annex I to this directive to ‘non-household customers’. Therefore, the provisions contained in paragraph 1(a) and (e) of that annex do not seem to apply to a non-household customer such as G. On the contrary, it follows that, for such a customer, the directive does not exclude the possibility that a fixed-term, fixed-price electricity supply contract may provide for a contractual penalty if the contract is terminated early with a view to switching supplier.

41.      Second, recital 42 of Directive 2009/72 states that all Community industry and commerce, including small and medium-sized enterprises, ‘should also be able to enjoy high levels of consumer protection’, and in particular household customers and, where Member States deem it appropriate, small enterprises should also be able to enjoy public service guarantees. In my opinion, the use of the conditional ‘should’ demonstrates the willingness of the EU legislature to leave the Member States a measure of discretion simply by giving them the power – but not the obligation – to grant small enterprises the benefit of high levels of consumer protection. Again, subject to verification by the referring court, it is not apparent from the order for reference that the Republic of Poland implemented this power as regards small enterprises. In those circumstances, it is my view that the directive does not preclude a small enterprise from being charged a contractual penalty if it terminates its fixed-term, fixed-price electricity supply contract early with a view to switching supplier.

42.      It is further important to note that Directive 2019/944, which repealed and replaced Directive 2009/72 with effect from 1 January 2021, explicitly states, in Article 12(2), that Member States shall ensure that ‘at least household customers and small enterprises’ (15) are not charged any ‘switching-related fees’, while providing, in paragraph 3 of that article, that, by way of derogation, Member States may permit suppliers or market participants engaged in aggregation to charge customers contract termination fees where those customers voluntarily terminate fixed-term, fixed-price electricity supply contracts before their maturity, provided that such fees are part of a contract that the customer has voluntarily entered into and that such fees are clearly communicated to the customer before the contract is entered into.

43.      In that regard, Article 2(16) of Directive 2019/944 defines ‘contract termination fee’ as a charge or penalty imposed on customers by suppliers or market participants engaged in aggregation for terminating an electricity supply or service contract. Meanwhile, Article 2(17) defines ‘switching-related fee’ as a charge or penalty for changing suppliers or market participants engaged in aggregation, including contract termination fees, directly or indirectly imposed on customers by suppliers, market participants engaged in aggregation or system operators. Therefore, the directive distinguishes between the simple termination of a supply contract and termination with a view to switching supplier. It is clear from those provisions that, under the directive, a small enterprise such as G is entitled to terminate a fixed-term, fixed-price electricity supply contract early with a view to switching supplier, without incurring any switching-related fees and consequently any termination fees.

44.      However, in view of the date of the facts of the dispute in the main proceedings, Directive 2019/944 is not applicable ratione temporis in this case. Moreover, although that directive lays down detailed rules on the fees that may be imposed on a small enterprise in the event of early termination of an electricity supply contract, such rules did not exist, even implicitly, under Directive 2009/72, as is apparent, inter alia, from point 41 of this Opinion. In my view, therefore, the provisions of Article 12 of Directive 2019/944 cannot apply by analogy in the present case. (16)

45.      Third, recital 52 of Directive 2009/72 states that clear and comprehensible information should be made available to ‘consumers’ concerning their rights in relation to the energy sector. (17) In my opinion, it can be inferred from that recital that, in this case, when a consumer plans to source electricity, he or she must, before entering into a fixed-term, fixed-price electricity supply contract, be informed by the supplier in a clear, comprehensive and transparent manner of the existence of a contractual penalty, the conditions of its application and the method for the calculation thereof. Furthermore, the amount of the penalty must not, having regard to Article 3(7) of Directive 2009/72, deprive him or her of the right to be able in fact easily to switch to a new supplier. In the present case, it is clear from the order for reference that the contract at issue gave specific details of the contractual penalty, which made it possible for G to know precisely how it was calculated and the fact that its amount corresponded to the price of the electricity not consumed before the original term of the contract. (18)

46.      It is thus apparent from the context of which Article 3(5) and (7) of Directive 2009/72 forms part that, in principle, the contract entered into between an electricity supplier and a small enterprise may provide for an early termination penalty to be imposed on the latter, provided that it was informed in a clear, comprehensive and transparent manner of the existence of the penalty when the contract was entered into and that the amount of the penalty does not deprive it of its right to be able in fact easily to switch to a new supplier.

47.      In the third place, the interpretation according to which Article 3(5) and (7) of Directive 2009/72 does not preclude a small enterprise from being charged a contractual penalty in the event of early termination of a fixed-term, fixed-price electricity supply contract, assuming the Member State has not extended the protection conferred on household customers to such enterprises, is supported by the aims pursued by that directive.

48.      The purpose of Directive 2009/72, as is apparent from Article 1 thereof, is to establish common rules for the generation, transmission, distribution and supply of electricity, together with consumer protection provisions, with a view to improving and integrating competitive electricity markets in the European Union. In this context, according to the case-law of the Court of Justice, the directive seeks, in essence, to establish an open and competitive internal market in electricity which enables consumers freely to choose their suppliers and suppliers freely to deliver to their customers, to create a level playing field in that market, to ensure security of supply and to combat climate change. (19)

49.      Consequently, the main aim of Directive 2009/72 is to bring about the internal market in electricity, (20) which implies, inter alia, the development of electricity suppliers ultimately to ensure better supply conditions for consumers. In that sense, recital 57 of Directive 2009/72 states that Member States must allow consumers to take full advantage of the opportunities of a liberalised internal market in electricity.

50.      It should be noted in that regard that fixed-term, fixed-price electricity supply contracts can protect customers by guaranteeing them a low and stable electricity price. The Commission, in its written observations, refers to an opinion of the Council of European Energy Regulators (CEER) of 17 May 2016 on early termination fees, (21) according to which such contracts give consumers the certainty of fixed energy costs that do not vary. (22) However, in return for entering into such a contract, the electricity supplier incurred various costs in order to acquire the total amount of energy necessary to cover the customer’s needs from the outset, which, as noted by the CEER, involves additional costs, particularly to hedge against the volatility of costs on the wholesale market. (23) As a result, if a customer who has entered into a fixed-term, fixed-price contract terminates the contract early, early termination fees may allow the supplier to offset the costs arising from the contract. Were that not the case, the supplier could be forced to pass on the risk of such costs being incurred to all customers, ultimately leading to higher electricity prices and less consumer choice. (24)

51.      In my view, therefore, in the framework of Directive 2009/72, the particularities of fixed-term, fixed-price electricity supply contracts mean that early termination fees may seem justified in order, ultimately, to protect all consumers by offering them lower electricity prices.

52.      Accordingly, I believe the main difficulty posed by this case lies in the amount of the contractual penalty, which must make it possible for the customer to be able in fact easily to switch to a new supplier, while offering the previous supplier adequate compensation to cover the costs incurred to perform the contract. Otherwise, it could risk undermining the effectiveness of Directive 2019/72.

53.      In that respect, the referring court cites Article 12(3) of Directive 2019/944 which, with regard to the costs of terminating a fixed-term, fixed-price electricity supply contract, states that those costs must ‘not exceed the direct economic loss to the supplier’. According to the referring court, that provision provides guidance on the interpretation of Article 3(5) and (7) of Directive 2009/72. First, however – as noted in point 44 of this Opinion – Directive 2019/944 is not applicable ratione temporis to the dispute in the main proceedings. Second, that provision only concerns the fees for terminating a fixed-term, fixed-price contract, and not the fees for switching supplier. Third, with regard to small enterprises, Directive 2019/944 took a different approach from Directive 2009/72, explicitly stating in Article 12(2) that Member States must ensure that small enterprises are not charged any switching-related fees. Therefore, I am of the opinion that Directive 2019/944 cannot serve as a reference for a case such as the one in the main proceedings.

54.      Regarding Directive 2009/72, it is worth noting that it gives no indication of the amount of fees that may be paid by a small enterprise when it terminates a fixed-term, fixed-price electricity supply contract early with a view to switching supplier, nor of the method for calculating those fees. The directive thus leaves Member States a measure of discretion with regard to the regulations on such termination fees.

55.      Therefore, in answer to the referring court’s question, I consider that national legislation according to which, in the event of early termination of a fixed-term, fixed-price contract by a small enterprise, a contractual penalty is due regardless of the extent of the damage suffered by the previous supplier, and even though that legislation does not set any criteria for the calculation or reduction of the penalty and allows the amount of the penalty to correspond to the price of electricity not consumed before the original term of the contract, is not, in itself, incompatible with Directive 2009/72.

56.      Nevertheless, the discretion left to Member States cannot have the effect of frustrating the right to be able in fact easily to switch supplier under Article 3(5) and (7) of that directive. In that respect, the referring court describes the case of a penalty where the amount corresponds to the price of the electricity not consumed before the end of the contract, under a ‘take-or-pay’ type clause. According to that type of clause, buyers have an obligation to pay for some or all of the electricity they have undertaken to purchase, irrespective of whether or not they use that electricity. (25) A ‘take-or-pay’ clause implies, prima facie, that the consumer bears all the risks of the supply contract taken out. It also acts as a strong deterrent to terminating the contract, to avoid having to pay double the electricity costs in the event of early termination. It may be inferred therefrom that such a clause is not compatible with Directive 2009/72.

57.      In certain specific circumstances, however, it cannot be ruled out that, under national regulations, where a supplier has incurred various costs to perform the fixed-term, fixed-price contract until its term, including purchasing electricity to cover the customer’s needs from the outset, the costs incurred by the supplier as a result of the early termination of the contract may actually correspond to the amount that the customer would have paid until the end of the contract had it continued to perform it as normal.

58.      In the present case, it is for the referring court to assess whether the contractual penalty affects G’s right to be able in fact easily to switch to a new supplier, taking into account all the concrete circumstances of the case, in particular the proportionality of the amount of the contractual penalty, which cannot exceed the coverage of the costs incurred by the previous supplier as a result of the early termination of the contract in order to avoid unjust enrichment of that supplier(26).

59.      In view of all the foregoing, I propose to answer the questions referred for a preliminary ruling that Article 3(5) and (7) of Directive 2009/72 must be interpreted as not precluding national legislation pursuant to which, where a small enterprise terminates a fixed-term, fixed-price electricity supply contract early with a view to switching supplier, that undertaking may be required to pay a contractual penalty in a situation where the legislation states that the penalty is due regardless of the extent of the damage suffered by the previous supplier, and even though that legislation does not set any criteria for the calculation or reduction of the penalty and allows the amount of the penalty to correspond to the price of the electricity not consumed before the original term of the contract, provided that the supplier has informed the undertaking in a clear, comprehensive and transparent manner of the existence of the contractual penalty, the conditions of application of the penalty and the method for the calculation thereof, and that the amount of the contractual penalty does not deprive the same undertaking of its right to be able in fact easily to switch to a new supplier. Accordingly, it is for the national court to take into account all the concrete circumstances of the case, in particular the proportionality of the amount of the contractual penalty, which cannot exceed the coverage of the costs that the previous supplier incurred as a result of the early termination of the contract.

V.      Conclusion

60.      In the light of the foregoing considerations, I propose that the Court answer the questions referred for a preliminary ruling by the Sąd Okręgowy w Warszawie (Regional Court, Warsaw, Poland) as follows:

Article 3(5) and (7) of Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC

must be interpreted as not precluding national legislation according to which, where a small enterprise terminates a fixed-term, fixed-price electricity supply contract early with a view to switching supplier, that undertaking may be required to pay a contractual penalty in a situation where that legislation states that the penalty is due regardless of the extent of the damage suffered by the previous supplier, and even though that legislation does not set any criteria for the calculation or reduction of the penalty and allows the amount of the penalty to correspond to the price of the electricity not consumed before the original term of the contract, provided that the supplier has informed the undertaking in a clear, comprehensive and transparent manner of the existence of the contractual penalty, the conditions of application of the penalty and the method for the calculation thereof, and that the amount of the contractual penalty does not deprive the same undertaking of its right to be able in fact easily to switch to a new supplier. Accordingly, it is for the national court to take into account all the concrete circumstances of the case, in particular the proportionality of the amount of the contractual penalty, which cannot exceed the coverage of the costs that the previous supplier incurred as a result of the early termination of the contract.

1      Original language: French.

2      Directive of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC (OJ 2009 L 211, p. 55).

3      OJ 1997 L 144, p. 19.

4      OJ 1993 L 95, p. 29.

5      Directive of the European Parliament and of the Council of 5 June 2019 on common rules for the internal market for electricity and amending Directive 2012/27/EU (OJ 2019 L 158 p. 125).

6      Dz. U. of 1997, No 54, position 348.

7      Dz. U. of 1964, No 16, position 93.

8      Under Article 3(3) of Directive 2009/72, a ‘small enterprise’, within the meaning of that directive, is an enterprise with fewer than 50 occupied persons and an annual turnover or balance sheet not exceeding EUR 10 million.

9      According to the order for reference, it is apparent from Article 4(4) of the agreement that: ‘if the contracts referred to in Article 1 are terminated before the end of the contractual term, [W] shall require the customer to pay a sum corresponding to the difference between the value of the electricity declared by the customer in paragraph 1, calculated according to the tariff set in Article 2, and the value of the electricity consumed by the customer prior to the termination of the contract, calculated according to the price set in Article 2, that difference having a positive value’. In that agreement, G also declared that it would purchase a specific amount of electricity from W.

10      According to the order for reference, the contract at issue set the price of electricity for the period between 1 March 2015 and 31 December 2016 at PLN 261.06/megawatt hours (MWh) (around EUR 61.24 at the date of the request). During that period, G had to purchase 245 MWh from W, equivalent to PLN 63 959.70 in total (around EUR 15 372 at the date of the request). This amount corresponds to the contractual penalty claimed.

11      See judgment of 23 January 2020, Energiavirasto (C‑578/18, EU:C:2020:35, paragraph 23).

12      See, in particular, judgment of 22 June 2023, Pankki S (C‑579/21, EU:C:2023:501, paragraph 38 and the case-law cited).

13      As the Commission notes in its written observations, it is clear from the order for reference that the contract at issue provided for a termination period not of three weeks, but of six months from the date of notification of termination, due to take effect at the end of the calendar year. However, since the questions referred in this case do not relate to the length of the termination period, I will not examine this question further.

14      In its written observations, the Commission submits that it would be appropriate to refer to the provisions on unfair terms in consumer contracts, particularly those contained in Directive 93/13. In that respect, I note that, as the 10th recital of Directive 93/13 states, the uniform rules of law in the matter of unfair terms laid down by that directive should apply to ‘all contracts’ concluded between ‘sellers or suppliers’ and ‘consumers’, as defined in Article 2(b) and (c) of that directive. According to Article 2(b) of Directive 93/13, a ‘consumer’ is any natural person who, in contracts covered by the directive, is acting for purposes which are outside his or her trade, business or profession (see, in particular, judgment of 9 July 2020, Raiffeisen Bank and BRD Groupe Société Générale, C‑698/18 and C‑699/18, EU:C:2020:537, paragraphs 69 and 70 and the case-law cited). However, in the present case, since G acted in the course of its trade, business or profession, there is no need, in my view, to refer to Directive 93/13.

15      My emphasis.

16      I note that similar provisions to Article 3(5) and (7) of Directive 2009/72 are found in Directive 2009/73/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in natural gas and repealing Directive 2003/55/EC (OJ 2009 L 211, p. 94), which is still in force. See Article 3(3) and (6) of Directive 2009/73.

17      In the absence of a specific definition in primary law, every EU act regarding consumers contains a definition of ‘consumer’ which applies only to the act in question (see, to that effect, Opinion of Advocate General Pitruzzella in the case YYY. (Concept of ‘consumer’) (C‑570/21, EU:C:2022:1002, point 32)). In the framework of Directive 2009/72, the concept of ‘consumer’ is not defined and appears to have a broad meaning, particularly in the light of recital 1, which states that the aim of the internal market in electricity is to deliver real choice for ‘all consumers of the European Union, be they citizens or businesses’.

18      See footnote 9 of this Opinion.

19      See judgments of 12 December 2019, Slovenské elektrárne (C‑376/18, EU:C:2019:1068, paragraph 32), and of 11 June 2020, Prezident Slovenskej republiky (C‑378/19, EU:C:2020:462, paragraph 22).

20      Judgment of 28 November 2018, Solvay Chimica Italia and Others (C‑262/17, C‑263/17 and C‑273/17, EU:C:2018:961, paragraph 36 and the case-law cited).

21      This document is available (in English) at the following address: https://www.ceer.eu/documents/104400/-/-/792d2636-53db-f60c-a7b7-7a676f3a28d0.

22      See p. 2 of the CEER opinion.

23      See p. 2 of the CEER opinion.

24      See p. 2 of the CEER opinion.

25      The ‘take-or-pay’ clause, frequently used in supply contracts, particularly in the energy sector, has three main characteristics: first, a compensatory nature in that it is intended to grant compensation to the beneficiary in the event of the other party defaulting on its obligations, and avoids the sometimes complex question of proving the existence and extent of the loss; second, an anticipatory nature since the parties, when entering into the contract, set the penalties that will be due to the creditor if the customer defaults on its obligations; third, a flat-rate nature, in the form of a fixed amount or certain percentage, which is high enough to encourage diligence, of the total value of the goods or sale price. See, in particular, Kohl, B., et al., ‘Les clauses take or pay: des clauses originales et méconnues’, Journal des tribunaux, 2009, No 6354, pp. 349 to 358, in particular pp. 354-356.

26      In that regard, it should be noted that the national courts are entitled to ensure that the protection of rights guaranteed by the legal order of the European Union does not result in unjust enrichment of the persons concerned (see judgment of 30 March 2023, NK and RD (Direct action against the insurer), C‑618/21, EU:C:2023:278, paragraph 41, and the case-law cited)

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