Legislative risks are subdivided into legal and regulatory risks.

Those risks arising due to legal proceedings, supply obligations or product liability are summarised under legal risks. Moreover, legal risks also include risks relating to erroneous or unenforceable contracts. These risks are limited centrally by the Group’s legal department, which is also responsible for the correct drafting of contracts and, if necessary, for managing legal proceedings.

Regulatory risks involve those risks arising due to antitrust, patent, accounting and tax law, as well as approval procedures, special legal conditions, special public sector conditions and the provisions of environmental law. The most significant regulatory risk to date entailed the reduction of grid fees due to incentive regulation, which came into force on 1 January 2009. Following the approvals issued by the regulatory authorities in 2009, revenue caps have now basically been set for electricity and gas grids for the entire first regulatory period up to 2012 and 2013 respectively. Changes in the legal framework provided by the German Incentive Regulation Ordinance could nevertheless lead to a further reduction in grid fee revenues in future.

To be able to counter future regulatory risks adequately and in good time, we constantly monitor developments in the energy industry and play an active role in the energy policy opinion-forming process.