EU has not yet received Spain notification of E.ON/Endesa conditions withdrawal |
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Published
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Thu, 18 Jan 2007 12:35
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BRUSSELS (AFX) - The European Commission said it has not received any notification from Spain confirming it has withdrawn the new conditions it attached to German utility E.ON AG's proposed acquisition of utility peer Endesa SA.'We haven't received anything,' it said.Tomorrow is the deadline for Spain to respond. If it does not, Madrid faces legal action.At the end of December, the EU executive demanded that Spain make the changes after ruling its conditions illegal.The obligations, imposed by the Spanish minister of industry, tourism and trade, but deemed unlawful by the EU, specify that Endesa can maintain its brand for a five-year period and that companies owning electricity assets outside mainland Spain must stay within the Endesa group for a period of five years.In addition, Spanish conditions that any Endesa power plants using domestic coal continue to do so, as stated in the national mining plans, and that E.ON does not adopt strategic decisions regarding Endesa and affecting security of supply, have been deemed unlawful.The commission said the conditions violate EU merger rules by breaching measures on the free movement of capital and on establishment. It added that some of the conditions also breach measures on the free movement of goods.The commission also said that for the time being it has not ruled against the conditions requiring that any acquisition of stakes in Endesa's share capital should be subject to the rules of the Spanish legal system, or the group fulfilling all existing obligations concerning the management of nuclear power plants.The commission also said it had taken note that the Spanish minister has not modified, but 'merely clarified', the condition imposed by Spain's energy regulator Comision Nacional de Energia (CNE) with regard to gas supply requirements.In November the commission eceived notification of amendments made by the Spanish government to the set of original conditions it attached to the transaction.In July, the CNE attached 19 conditions to the planned 26.9 bln eur acquisition.At the end of September, the commission said Spain must remove the conditions, after finding the majority of them illegal. It also called for a change in Spanish law to amend the powers of the CNE.In mid-October, the commission launched legal action.The commission said in December that its assessment of the conditions imposed by CNE remains valid in so far as the amendments made by the Spain have 'not modified or has only slightly modified' the CNE's earlier conditions.It added that it is still evaluating whether the Spanish authorities complied with its September decision.At the end of April, EU competition regulators approved the acquisition.It said the transaction would not significantly impede effective competition.On Tuesday, a Madrid court today lifted an injunction on peer Gas Natural SDG SA's offer for Endesa. The ruling effectively kick-started the bidding process.The court had placed an injunction on the operation at Endesa's request, citing a pre-agreement between the Catalan gas company and Iberdrola SA over the sale of assets if the Gas Natural's bid for the Spanish utility were successful.simon.zekaria@thomson.comsz/gpCOPYRIGHTCopyright AFX News Limited 2006. All rights reserved.The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.AFX News and AFX Financial News Logo are registered trademarks of AFX News Limited
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E.ON seeks probe on possible Acciona, Gas Natural collusion on Endesa UPDATE 