* EU preparing for sanctions threat over gas pipeline
* U.S. sanctions could come in July
* German parliament committee to hear experts Wednesday
By Kate Abnett and Vera Eckert
BRUSSELS/FRANKFURT, June 29 (Reuters) - The European
Commission is preparing measures to protect the European Union
as it faces threatened U.S. sanctions, which could break
international law, on a link to carry gas directly from Russia
to Germany, the EU's foreign policy chief said.
U.S. senators this month announced a bill tightening
sanctions on the Nord Stream 2 pipeline, designed by Russia's
Gazprom.
Washington says the link, due to begin operation early next
year, will boost Moscow's economic and political influence in
European countries.
"The EU's position on U.S. sanctions against European
companies that carry out legitimate and lawful activities under
European law is unequivocal. They are unacceptable and contrary
to international law, and the Union firmly opposes them," Joseph
Borrell said in a written response dated June 25.
"The Commission is preparing the ground for the adoption of
an enhanced sanctions mechanism that will improve Europe's
resilience to the effects of extra-territorial sanctions imposed
by third countries."
Borrell did not say what form the mechanism would take, or
when it would be introduced.
He was replying to a question from EU lawmaker Emmanuel
Maurel regarding initial U.S. sanctions on the project imposed
in December.
By damaging the European Union's economic interests, U.S.
sanctions would weaken the two parties' show of unity against
Russia's actions to destabilise Ukraine, after Moscow annexed
the Black Sea peninsula of Crimea from Kiev in 2014, Borrell
said further.
The U.S. sanctions threat has prompted the German
parliament's economic committee to hold a hearing on July 1 and
German business lobbies have called for rescue funds for
companies affected.
Timm Kehler, head of gas lobby Zukunft Erdgas, in a
statement to the committee published before the event, said such
a precedent of "extra-territorial sanctions" must be avoided.
"The adoption of such a tightened and retroactive sanctions
law would be an unacceptable encroachment on the EU sovereignty
and energy security of Western Europe," he said.
(Reporting by Kate Abnett and Vera Eckert; editing by Barbara
Lewis)
