The European Union Thursday said it cannot accept the new payment procedure set by Russia for sale of gas to European companies. Senior EU officials told journalists in Brussels on Thursday that European gas companies, currently, pay the Russian energy company Gazprom into a European bank account situated in Europe the currency foreseen in the contract. Up to 97 percent of the contracts are payments either in dollars or euro. From now on the payments will be done in two different phases. The European companies have to open a bank account in euro in Russia for the gas purchase. Under the new procedure, the payment will only be completed when the euro in a bank account in Russia is converted into roubles, explained the EU officials speaking on condition of anonymity. For this to happen, European companies have to open a second bank account in Russia in roubles. The Russian state or the Russian Central bank will be in full control of this amount before the conversion into roubles and not in the hands of the European companies, they said. Then the Russian authorities or the Russian Central bank could decide how long they will keep this money in euro before they decide to convert it into the second bank account. They could tell the European companies that they have not paid because the money has not been converted into roubles, said the EU officials. "What we cannot accept is that the European companies are obliged to open a second account and the amount in euro is in full hand of the Russian authorities and that payment is only complete when it is converted into roubles. This is a clear circumvention of sanctions," said an EU official. "It is sort of a loan given by the European companies to the Russian Central Bank before the payment is completed," they said. Russian President Vladimir Putin announced last week that Russia would start selling gas to "unfriendly" countries in roubles, after a freeze on Russiaآ's assets by the EU for the military invasion of Ukraine. The "unfriendly" countries include the 27 EU members. Moscow has halted gas supplies to EU member states Poland and Bulgaria because they are refusing to pay in the Russian currency roubles. EU Commission President Ursula von der Leyen yesterday warned that any companies that comply and pay in roubles will face consequences as this would violate the EU sanctions. — Agencies
