Order subject to periodic penalty payments imposed on Dutch regional network operator Delta

Dutch regional network operator Delta is no longer allowed to use the same name and logo as those used for the commercial activities of the parent company to which Delta belongs. The Netherlands Authority for Consumers and Markets (ACM) has given Delta six months to change its name and logo. After that six-month transition period, Delta will have to pay a penalty payment of EUR 100.000 per week (with a maximum of EUR 2 million) for as long as it has not changed its name and logo.

Delta had decided to use the same logo for all its business units, including the network operator, from January 1, 2014. With that decision, Delta violated both the Dutch Electricity Act 1998 as well as the Dutch Gas Act. A complaint was subsequently filed with ACM. Remko Bos, Director of the Energy Department of ACM, explains: “Consumers must be able to make a clear distinction between the network operator that performs the statutory tasks such as the transmission of electricity and natural gas, and the business units that perform commercial activities. If consumers are unable to do so, the commercial company can benefit from the network operator’s brand recognition that it already enjoys due to its statutory tasks. This gives the commercial company an advantage over its competitors without network operators.” Although Delta yesterday made the unexpected move to change its name, ACM wants to be sure that the changes to Delta’s name and logo will have been completed in six months. The order subject to periodic penalty payments forces Delta to do that.