Brussels, 05/12/2007 (Agence Europe) - On Wednesday 5 December, the European Commission announced that the most recent conditions imposed by the Spanish authorities on Enel and Acciona for their acquisition of the electricity company Endesa, are incompatible with EC law and requested their withdrawal by 10 January 2008.
Enel Energy Europe S.r.l. (Italy) and Acciona S.A.'s draft acquisition was approved by the National Energy Commission ("CNE") in its decision of 4 July 2007, in exchange for certain conditions. The Commission had condemned some of these conditions: the obligation to maintain Endesa as an independent company, including its brand, and its decision-making centre in Spain; b) a limitation in Endesa's debt service ratio; c) a limitation with respect to Endesa's dividends distribution policy; d) the obligation for certain of Endesa's generation assets to purchase certain amounts of national coal; and e) the obligation to keep the assets of the insular and non-mainland electricity systems within the Endesa Group.
The Commission explained that a member state can impose certain conditions on a cross border acquisition but only if it is for protecting public safety, media plurality and respect of prudential rules. Even in these circumstances, conditions have to be proportionate and compatible with Community law, which has not occurred in the case in point. These conditions have to be withdrawn by 10 January 2008 at the latest, failing which the Commission may begin infringement proceedings against Spain. This country was taken to the European Court of Justice because of the conditions imposed on the takeover of Endesa by E.On (EUROPE 9332 and 9396). E.On has abandoned its proceedings but the conflict between the Commission and Spain is still pending at the Court (case C-196/07). (C.D.)