In a letter of formal notice sent to Madrid on Thursday 17 July, the European Commission found that Spain had breached banking prudential rules and the principles of free movement of capital and freedom of establishment in connection with BBVA’s €13 billion takeover of Banco Sabadell.
The Spanish legislation gives the Spanish government “unfettered powers to intervene in bank mergers and acquisitions”, which encroach on the competences of the ECB and national supervisors, said Olof Gill, spokesperson for the European institution. “The single market cannot function if commercial transactions are subject to government approval”, he added, pointing out that any conditions attached to the approval of a transaction must be “exceptional, proportionate and justified by valid reasons of public interest”.
The Commission would point out that the ECB, acting as sole supervisor within the banking union, has approved the BBVA-Banco Sabadell transaction. The same applies to the Spanish competition authority, subject to mitigating measures relating to loans to SMEs and ensuring that consumers in remote areas of the country retain access to ATMs.
Acknowledging the opening of the infringement procedure, the Spanish Ministry of the Economy points out that the 2007 Spanish antitrust law has been applied “on several occasions” and says it is ready to “clarify any legal or technical differences, reaffirming its firm commitment to the principles of the single market”.
Spain has two months to respond to the Commission’s letter. (Original version in French by Mathieu Bion)