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French Lawmakers Study Removing State-Set Gas Rates for Industry

France’s biggest industries may stop paying regulated rates for natural gas by the end of the year as the government bows to pressure from the European Union.

An amended law under consideration in the National Assembly proposes a phaseout of state-set rates for businesses, starting with the largest industrial sites and reaching smaller companies by 2016, according to a draft on the parliament’s website.

Regulated gas prices have caused friction between former monopoly supplier GDF Suez SA (GSZ), the government and the European Commission, which wants them eliminated in favor of competition. The country and the commission have now reached an agreement designed to end an impasse dating back to 2006, the draft shows.

The CGT labor union, which represents workers in some of the affected industries, said the government is trying to “sneak” the proposal through parliament.

“It’s unacceptable,” Martine Feuillerat, a union representative, said by telephone. “The regulated rates offer protection against swings in market prices and are designed to help industrial development.”

The amended legislation is part of an unrelated consumer law scheduled to be debated in parliament this month. It’s the latest effort to overhaul gas pricing after France’s highest court this year forced the government to change the way it sets rates for households, helping utilities cover their costs.

To contact the reporter on this story: Tara Patel in Paris at tpatel2@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net

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