|Author (Person)||Chapman, Peter|
|Series Title||European Voice|
|Series Details||Vol 7, No.4, 25.1.01, p4|
SINGLE market chief Frits Bolkestein is set to take on fellow European Commissioner Loyola de Palacio over the issue of foreign investment in national industries. The Spanish energy and transport supremo wants to strengthen the powers of member states to ward off foreign takeovers, but Bolkestein's supporters say he will oppose any watering down of EU rules on free movement of capital.
De Palacio believes it is unfair for privatised companies to be 'infiltrated' by foreign firms which are still under national ownership, even though governments can block takeovers or other share acquisitions by keeping a majority shareholding.
"However," said one source, "it is a no-no that a member state once it has relinquished majority control can try to influence whether other companies can acquire shareholdings." He also said governments cannot retain 'golden shares' to prevent takeovers. Golden shares give governments special voting rights that effectively hand them veto power over who controls a privatised company.
Bolkestein, according to sources, will resist demands from member states for a delay after privatisation during which they can block foreign takeovers. "It may suit certain member states with Commissioners who are ready to defend their national interest. But how could the Commission ... justify relaxing its position on cross border investment obstacles?"
De Palacio forced the ownership debate after criticising the EU executive's vote last year to take Madrid to court over its use of a golden share to block the takeover of a Spanish utility by Electricité de France.
Single market chief Frits Bolkestein is set to take on fellow European Commissioner Loyola de Palacio over the issue of foreign investment in national industries.
|Subject Categories||Business and Industry, Internal Markets|