In October 2000 major Italian newspapers and the Financial Times published, on ENEL’s (the formerly completely state-owned electricity monopolist) request, a notice to the public containing an "Invitation for indication of interest in the acquisition of the entire participation in the share capital of Elettrogen S.p.A". Elettrogen is one of the three new generating companies that ENEL established pursuant to the provisions of Decree N. 79/1999 whereby Italy implemented EC Directive 96/92, concerning common rules for the internal electricity market.
Specifically, the Decree obliged ENEL to dispose of at least 15,000 MW of its generating capacity, which brought about the incorporation of Eurogen S.p.A, Elettrogen S.p.A, Interpower S.p.A, among which such generating capacity was split.
The notice to the public required the letters of indication of interest to be delivered on or before the 10 November 2000. However, just when the prospective purchasers were organizing themselves (often through the creation of consortia or joint-venture companies) in order to prepare the letters of indication of interest, the government became concerned that in the purchase procedure could participate companies (as it is the case with several existing local Italian utilities or, for instance, with Electricité de France) owned or controlled by public capital, thus jeopardizing the intended privatization of the market.
Therefore, on 4 November 2000, the President of the Cabinet approved a Decree whereby is decided that only companies, or groups of companies, whose capital belongs to public entities within the maximum limit of 30%, will be allowed to finalize the eventual purchase.
The Decree provoked an outburst of protest by some potential purchasers who complained that:
- one can not change the rules when the race has already been started;
- the Decree is contrary to EC law.
Moreover, adding fuel to the protests, ENEL decided not to postpone the 10 November 2000 deadline.
The Decree has yet to be published in the Official Gazette; just after publication those caught by the provisions of the Decree will decide whether or not to file actions to set it aside.
The contents of this publication are not intended to provide legal advice that pertains to specific circumstances, for which you should consult appropriate counsel