EU: dwarsbomen Spaans-Duitse energiefusie illegaal (en)

The European Commission has deemed illegal attempts by Madrid to impose restrictions on a German company's attempt to take over Spain's main electricity group.

Notification of the preliminary decision was sent to the Spanish authorities on Friday (25 August) with Madrid being given until 4 September to reply.

Brussels' move is in response to a decision by the Spanish government earlier this year to impose strict conditions on the planned takeover of Spain's major electricity group, Endesa, by the German energy giant, E.ON.

Among the conditions were that the merged company must sell a large portion of its generating capacity, its must sell assets on Spain's island territories and in the North African enclaves of Ceuta and Melilla and give up control of several nuclear power stations.

The conditions were widely seen as an attempt to offer a helping hand to Gas Natural, Spain's leading gas company, which is competing against E.ON.

In a statement on Friday, the commission dismissed Spain's grounds for defence. Madrid was using Article 21 of the EU merger regulation which allows member states to block mergers on the grounds of public security.

"The Commission considers in its preliminary assessment that these conditions [imposed by the Spanish regulator] violate the EC Treaty's rules on the free movement of capital and the freedom of establishment", it said.

It also said that the measures are "not justified on public security grounds and that in any event they are neither necessary nor proportionate for the protection of public

security."