Privatizations of State-Owned Companies and Justifications for Restrictions on EU Fundamental Freedoms: Past, Present and Future Perspectives

Abstract

AbstractThis chapter reviews and critically evaluates privatizations of State-owned companies and justifications for restrictions on EU fundamental freedoms. Past, present and future perspectives are considered. First, this chapter analyses past perspectives on justifications for restrictions on EU fundamental freedoms in the context of CJEU’s golden shares case law. According to CJEU’s golden shares case law, special rights in privatized companies restrict EU fundamental freedoms. The CJEU examined the possibility of justifications for such restrictions on public interest considerations. This chapter scrutinizes the evolution of justifications for such restrictions, focuses on legitimate justifications and explores under which conditions EU Member States could continue to have special prerogatives in privatized companies on the basis of public interest considerations. Special emphasis is given on the conditions established by Commission v Belgium, the only golden shares case, where the restrictions were found to be justified. Secondly, regarding current perspectives on available justifications, this chapter discusses justifications for restrictions on freedom of establishment in the recent case Associação Peço a Palavra, where the conditions of a privatization process were scrutinized. This latter case scrutinized the justification for restrictions resulting from tender specifications governing the conditions to which a privatization process of a State-owned company was subject. The importance of Associação Peço a Palavra is analysed. Thirdly, future perspectives on privatizations and available justifications for restrictions on EU fundamental freedoms are considered in the light of corporate social responsibility (CSR). This chapter examines whether CSR goals in privatized companies could be underpinned by justifications for restrictions on EU fundamental freedoms. Previous case law provides useful guidance on how CSR could be integrated into privatized companies through tender specifications or golden shares. A few conclusions are deduced.KeywordsEuropean company lawPrivatizationsState-owned companiesEuropean business lawInternal marketEU fundamental freedomsFree movement of capitalFreedom of establishmentJustifications for restrictionsCJEU’s case lawPublic interestGolden sharesTender specificationsCorporate social responsibilityCSR