Original scientific paper
SELLING SHARES OF STATE OWNED ENTERPRISES – METHODS APPLIED IN PRIVATIZATION PROCESS AND OPEN ISSUES
Edita Čulinović Herc
; Pravni fakultet Sveučilišta u Rijeci
Antonija Zubović
; Pravni fakultet Sveučilišta u Rijeci
Abstract
Recent trends in the EU Member States, as well as in the Republic of Croatia,
show an increase in the sale of shares of state owned enterprises. In this paper authors
sought to investigate permissive and available techniques of selling those shares. The
dilemma is how to achieve the best selling price by choosing one of the prescribed
methods without being in breach of the rules concerning state aid and free movement
of capital. Moreover, since many state owned enterprises are playing vital role in
the Croatian economy, the question arises how to protect national interests and in
the same time stay in line with principles of free movement of capital and state aid
rules. The Croatian law provides seven methods of selling the shares. When selecting
the method, in order to be in compliance with state aid rules, it is necessary to take
into account Market Economy Vendor Principle as spelled out in the Guidance Paper
adopted by the Commission. Although this Guidance Paper does not represent an
official position of the Commission on the issue, its importance is highlighted in
the Commission’s decisions and court practices in the European Union. As far as
principle of the free movement of capital is concerned, the question arises, whether
some permissible exceptions as to it could be a source to protect national interest
in companies that are of strategic interest. The paper gives an overview of the recent
acquisition of Alstom by General Electric in which France protected its national
strategic interests by issuing special decree in which it evokes the application of the
permissive exceptions to the principle of the free movement of capital. Although the
case is still “in the monitoring of the Commission”, authors explore viability of that
method in the Republic of Croatia.
Keywords
privatization; state-owned enterprises; types of sale of shares; share issue privatization; protection of state interests; state aid; free movement of capital; Market Economy Vendor Principle; the Alstom decree
Hrčak ID:
141178
URI
Publication date:
13.4.2015.
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