Luxembourg, 03/07/2001 (Agence Europe) - In the opinion of Advocate General Damaso Ruiz-Jarabo, national regulations which prescribe 'golden shares' are not in themselves contrary to Community law, explained a Court of Justice press release, adding that the Advocate General believes that "it is possible for Member States to organise systems of company ownership, particularly in strategic sectors (for example energy) insofar as this organisation does not discriminate against citizens from other Member States". The Advocate General therefore recommends that the Court of Justice validate the three national regulations in question (Portuguese, French and Belgian).
The European Commission had brought infringement proceedings before the Court of Justice against Portugal, France and Belgium. It considered that certain provisions in those countries which restrict shareholdings, notably in the context of the privatisation of certain undertakings, were incompatible with Community law on freedom of establishment and the free circulation of capital.
The press release states that "the Advocate General considers that for the restrictions which are indistinctly applicable to nationals and non-nationals (Portuguese Decree of 1993, French and Belgian regulations), it is necessary to refer to the provisions in the Treaty; the Treaty does not prejudice the system of company ownership in the Member States. According to the Advocate General, the aim of this provision it to affirm the neutrality of the Treaty in relation to the control of companies as production resources, the Member State retaining the possibility to impose certain economic policy objectives which are distinguished from the aim of maximum profit which characterises private sector activity. The Advocate General considers that the national systems which provide for golden shares in favour of the state are covered by this principle of neutrality. As they are indistinctly applicable to national citizens and non-national citizens, the system are not in themselves contrary to the Treaty".
The three regulations that the Advocate General recommends should be considered as compatible with EU law are: a Portuguese Decree of 1993 providing for a mechanism of prior authorisation by the Minister for finance for the acquisition of shares representing more than 10% of the capital of companies which are being privatised; a French Decree of 1993 prescribing a specific state holding in the Société Nationale Elf-Aquitaine carrying rights whereby holdings of capital or voting rights by a natural or legal person in excess of certain thresholds must be approved by the Minister responsible for the economy; a Belgian Royal Decree of 1994 establishing in favour of the state a specific holding in the Société Nationale de Transport par Canalisations by virtue of which the Minister of Energy is able to object to the transfer of shares to natural or legal persons if he/she considers that the changes within the company might adversely affect Belgium's national energy interests; and finally, a Portuguese law of 1990 which specifies in each case the maximum authorise foreign shareholding in the context of the privatisation of certain undertakings (the only one that the Advocate General sees as being contrary to Community law in that it is discriminatory against non-Portuguese EU citizens).