Are you sure?

EU exec takes Portugal to court over Galp Energia

The European Commission said it was taking Portugal to the top European Union court over concerns that special rights the state held in energy group Galp Energia restricted the free movement of capital.

“The European Commission has decided to refer Portugal to the European Court of Justice as it considers that the special right held by the state in Galp Energia discourages investments from other member states,” the Commission said in a statement.

The Commission, which polices competition in the 27-nation EU, said veto rights held by Portugal in the oil and gas company constituted an unjustified restriction on the movement of capital and the right of establishment.

In 2007, the EU's executive arm called on Portugal to abandon the rights, which include that of appointing the chairman of the board of directors.

Portugal argued that the special powers were justified because the services provided by Galp Energia were of general economic interest and for the security of energy supply. (Reuters)