Brussels, 14/03/2011 (Agence Europe) - On 14 March, the European Commission decided to ask Portugal to comply with a November 2010 Court of Justice ruling (EUROPE 10255), which found that the Portuguese state's special rights (“golden shares”) in Energías de Portugal (EDP) restricted the free movement of capital. The Commission considers that by maintaining them in force, Portugal failed to fulfil its Treaty obligations. Portugal now has two months to inform the Commission of measures taken to comply with the ruling. If Portugal does not comply, the Commission may refer the case back to the Court for a second time.
What is the basis of Commission's complaint against Portugal? Given its special powers, Portugal has a disproportionate influence with regard to its stake in the company (25.73%). This influence includes: - its veto rights on a range of important resolutions to amend the company's articles of association, including capital increases, mergers, divisions and winding-up; - resolutions on entering into parity and subordination group contracts, and on abolishing or limiting shareholders' rights of preference as regards capital increases; - the right to oppose the election of a number of directors and the right to appoint a director in the company. Although the company imposes a limit on voting rights in the general assembly for all shareholders holding more than 5% of the capital of the company, this does not apply to the state. The Commission therefore considers that these factors could discourage investors from other member states by denying them the possibility of participating in the management and control structures of the EDP, which therefore creates a restriction to the free movement of capital. (F.G./transl.fl)