The Republic has been rebuked by the European Commission over its failure to adopt legislation to free up its gas market.

The commission said yesterday that it would take the Republic to the European Court of Justice for not opening up the market to new providers.

The Republic is one of five member states singled out by the energy commissioner, Andris Piebalgs, for failing to implement EU-wide rules on opening their energy markets to new entrants.

The rules are aimed at breaking up energy monopolies, such as the position held by Bord Gáis in the Republic. "This legislation is an essential step towards the completion of a truly competitive EU energy market," Mr Piebalgs said yesterday.

A spokeswoman for the Department of Communications, Marine and Natural Resources said last night that the Republic was working to remedy the situation. The Government has, she said, prepared the required legislation and has given a copy to the European Commission.

"The department has told the commission that the required law will be put in place within a matter of months," she added.

The commission sent letters to 18 states last October warning them to bring their national laws into line with EU rules.

They had agreed to make the necessary changes more than a year before.

The EU directives stipulate that industrial customers should have been able to shop around for the best deal in gas and electricity by July 1st this year. The same will apply to household consumers in 2007. The Republic has fulfilled this requirement for the electricity market, with yesterday's court threat focused solely on gas.

A spokesman for Mr Piebalgs said last night that the move to bring the Republic to court had come "after several warnings".

He acknowledged however that if the Republic were to move "very quickly" on transposing the gas directive, the court proceedings could be dropped.

Otherwise, the Republic could face a fine over the issue. - (Additional reporting, Reuters)