PORTUGAL TELECOM: COMMISSION TAKES LISBON TO COURT.

The European Commission announced, on 31 January, that it planned to initiate proceedings against Portugal at the European Court of Justice because the privileges attached to the preferential (or golden') shares (500 in all) that the state holds in Portugal Telecom (PT) constitute a violation of free movement of capital by hindering investments from other member states. The difference of views between Portugal and the Commission began in 2005. Lisbon has consistently refused to give up its preferential shares matched with a right of veto for takeover...