Brussels, 06/02/2003 (Agence Europe) - The European Commission has decided to make a formal request to the Netherlands to review certain provisions of the Articles of Association of KPN and TPG, that grant the Dutch State preferential status as well as the special rights accorded to the holder of the "golden share" in the company capital. The Commission considers that these special rights do not comply with the principle of free movement of capital or to the right of establishment. The Netherlands has two months in which to comply with the Commission's requests, failing which the latter may take the case before the Court of Justice.
Koninklijke KPN N.V (KPN) and TNT Post Groep N.V. (TPG) are the two firms that emerged from the privatisation in 1998 of Koninklijke PTT Nederland N.V., the public telecommunications and postal services operator in the Netherlands. Back in 1994, at the time of the first stage of the partial privatisation of the latter's capital, the Dutch State decided that special powers were needed to safeguard in particular the provision of a minimum universal service in the telecommunications sector as well as in distribution and logistical services. Furthermore, the Articles of Association give the State, irrespective of its share in the capital of each firm, the right to appoint three members of the supervisory board, which has a decisive say in the management of the firm. Also, the "golden share" confers special rights to approve certain decisions taken by the firm's competent bodies. The Articles of Association of KPN and TPG contain those same special powers initially conferred on Koninklijke KPN N.V.
The Commission considers that, without being explicitly discriminatory, these special powers are liable to make it more difficult to acquire shares in the firms concerned and therefore deter investors from other Member States from investing in their capital. They are, therefore, likely to render illusory the free movement of capital and so constitute a restriction on capital movements within the meaning of Article 56 of the Treaty. Also, in so far as these special powers also allow the Dutch Stated to exercise control over the management policy and day-to-day operation of the two companies, they affect direct investment and could thus also constitute a restriction on the freedom of establishment guaranteed by Article 43 of the Treaty.