Cross-Border Compliance Obligations for Operators

Detailed Explanation With Case Laws

1. Introduction

Cross-Border Compliance Obligations for Operators refers to the legal duties imposed on electricity companies, transmission system operators (TSOs), distribution system operators (DSOs), suppliers, market operators and other energy businesses that operate across national borders.

Cross-border operators must follow not only their national laws, but also applicable regional or international rules. In the EU, this includes the Internal Electricity Market Regulation, network codes, balancing rules and decisions of ACER. EU law specifically requires national regulators to supervise compliance with these rules, including cross-border obligations. (Eur-Lex)

2. Meaning of Cross-Border Compliance

A company operating in more than one country may have to comply with different legal systems.

For example:

Operator in Country A

↓

Cross-border interconnector

↓

Electricity market in Country B

The operator may have obligations concerning:

licensing;

grid access;

technical safety;

electricity trading;

balancing;

data reporting;

congestion management;

environmental requirements; and

market transparency.

Therefore, cross-border compliance requires coordination between national regulators and energy authorities.

3. EU Legal Framework

Regulation (EU) 2019/943 provides important rules for the internal electricity market. It seeks fair rules for cross-border electricity exchanges, harmonised principles for transmission charges and allocation of interconnection capacity. It also requires barriers to cross-border electricity flows and related transactions to be progressively removed. (Eur-Lex)

Directive (EU) 2019/944 further requires Member States to ensure that electricity undertakings operating in the internal market are subject to transparent, proportionate and non-discriminatory rules. Third-country market participants operating within the EU market must comply with applicable EU and national law. (Eur-Lex)

4. Licensing and Market Access

Operators may need appropriate authorisation before supplying electricity, operating networks or participating in regulated markets.

The regulatory framework should prevent unnecessary barriers to market entry while ensuring that operators satisfy technical and legal requirements.

For cross-border operators, authorities must consider whether an undertaking already authorised in another jurisdiction can operate under the applicable rules of the host country.

5. Technical and Network Compliance

TSOs and DSOs must comply with technical standards concerning:

network security;

frequency control;

system balancing;

emergency procedures;

congestion management;

interconnector operation; and

information exchange.

EU electricity law requires TSOs to coordinate their activities and establish mechanisms for information exchange and secure network operation. (Eur-Lex)

These obligations are essential because a technical failure in one country can affect interconnected systems in neighbouring countries.

6. Cross-Border Capacity Obligations

Operators involved in cross-border electricity trading must comply with rules concerning cross-zonal capacity.

Capacity must be calculated and allocated according to applicable European methodologies and network rules.

Operators cannot simply reserve or restrict interconnector capacity according to national preferences where EU rules require coordinated and non-discriminatory allocation.

7. Balancing Obligations

Electricity operators may also have responsibilities for maintaining system balance.

If a market participant produces or consumes electricity different from its scheduled position, an imbalance can arise.

Operators may therefore have to comply with:

balancing arrangements;

imbalance settlement;

reporting requirements;

balancing-market participation rules; and

TSO instructions.

These requirements help maintain stability across interconnected electricity systems.

8. Information and Reporting Duties

Cross-border operators must provide accurate information to regulators and system operators.

This can include:

generation data;

electricity flows;

capacity information;

transactions;

outages;

balancing information; and

network-security information.

EU rules require TSOs to maintain coordination and information-exchange mechanisms for network security and congestion management. (Eur-Lex)

Failure to provide correct information can affect both market transparency and system security.

9. Non-Discrimination

A central principle is non-discriminatory treatment.

Operators and regulators should not unfairly favour domestic electricity businesses over businesses from another Member State.

Directive 2019/944 requires a level playing field concerning matters such as balancing responsibility, wholesale-market access, data access, switching and licensing. (Eur-Lex)

This principle supports the development of an integrated electricity market.

10. Case Law: Polskie Sieci Elektroenergetyczne v ACER

In Case T-483/21, Polskie Sieci Elektroenergetyczne v ACER, the General Court considered ACER's authority concerning a methodology for regional coordination of operational security.

The Court upheld the relevant regulatory approach and explained the importance of regional coordination for secure operation of interconnected transmission systems. (curia)

Relevance

The case demonstrates that TSOs operating across borders cannot always deal with network-security issues independently. Common regional methodologies can impose legally binding coordination obligations.

11. Case Law: BNetzA and Germany v ACER

In Cases T-600/23 and T-612/23, BNetzA and Germany v ACER, the General Court considered ACER's decision concerning day-ahead and intraday cross-zonal capacity calculation.

In October 2025, the General Court annulled the relevant ACER decision on the grounds addressed in its judgment. (curia)

Relevance

The case shows that cross-border compliance obligations must be based on properly established legal powers and procedures. Operators and regulators must therefore comply with both substantive rules and procedural requirements.

12. Regulatory Supervision

National energy regulators play a major role in enforcement.

Under Directive 2019/944, regulatory authorities are responsible for ensuring compliance by TSOs, DSOs, electricity undertakings and other market participants with EU electricity legislation, network codes, guidelines and relevant ACER decisions, including cross-border matters. (Eur-Lex)

Where national regulators cannot resolve certain cross-border compliance questions, EU-level mechanisms involving ACER may become relevant.

13. Penalties and Enforcement

Non-compliance can lead to:

administrative penalties;

licence consequences;

corrective orders;

compensation obligations;

restrictions on market participation; and

judicial or regulatory proceedings.

The exact penalty depends on the applicable national and EU legal framework.

14. Importance for Energy Governance

Cross-border compliance creates a system where:

Operators → National regulators → Regional coordination → ACER/EU framework

This structure attempts to balance national regulatory authority with the need for an integrated electricity market.

It is particularly important as electricity systems become more dependent on:

renewable generation;

interconnectors;

electricity trading;

storage;

demand response; and

regional balancing.

15. Conclusion

Cross-Border Compliance Obligations for Operators ensure that energy companies and network operators follow common legal, technical and market rules when operating across national boundaries.

The EU framework requires compliance with electricity-market legislation, network codes, balancing rules, cross-border capacity requirements and relevant ACER decisions. (Eur-Lex)

The Polskie Sieci Elektroenergetyczne v ACER case demonstrates the importance of regional coordination for network security, while BNetzA and Germany v ACER illustrates the need for proper legal authority and procedure in cross-border regulatory decisions. (curia)

Overall, effective cross-border compliance requires clear licensing, technical standards, information sharing, non-discrimination, balancing responsibility, capacity rules and coordinated regulatory supervision. These obligations help maintain security, competition, transparency and reliability in interconnected electricity markets.