The EU executive has decided on Thursday to refer Croatia to the ECJ for failing to align the 2002 law on the privatisation of INA with EU rules on the free movement of capital and the freedom of establishment.
INA is the main Croatian energy company, partially owned by the Croatian Government.
The INA law grants the State special powers in this company, including vetoing INA’s decisions relating to the sale of shares or assets above a certain value. The State can also oppose important management decisions, such as a change in the company’s activities, the granting of concessions or authorisations and the location of its registered office.
“The fact that the Croatian State can refuse to approve important decisions that would be in the company’s interest may negatively impact company shares and reduce the INA’s attractiveness to investors,” the EC argued.
The Commission considers that the State’s special powers provided for in the INA law unduly restrict the free movement of capital and freedom of establishment.
It acknowledges that the objective of protecting the security of energy supply is a legitimate public interest shared by the EU and could justify restrictions to the freedoms listed in TFEU. However, such restrictions must be proportionate.