Portugal Telecom
Encyclopedia
Portugal Telecom is the largest telecommunications service provider
in Portugal
. Although it operates mainly in Portugal and Brazil
, it has also a significant presence in Guinea-Bissau
, Cape Verde
, Mozambique
, Timor-Leste
, Angola
, Kenya
, the People's Republic of China
, and São Tomé and Príncipe
.
Due to its large market share, Portugal Telecom is considered a de facto monopoly in fixed telephony in Portugal.
experiments in Portugal connected Carcavelos
to the Central do Cabo in Lisbon
, in 1877. In 1882, the Edison Gower-Bell Telephone Company
was established in both Lisbon and Porto
, to explore the respective telephone service concessions. In 1887, the concession was transferred to APT - The Anglo Portuguese Telephone Company, which was kept by the latter until 1968, the year in which the Public Company "Telefones de Lisboa e Porto" (TLP) was created. The Post Office, Telegraphs and Telephones (CTT
) explored until this present day, the telephone service in the rest of the country. For the exploration of radiotelegraphy and wireless telephone, a contract with the Marconi's Wireless Telegraphy Company concession was confirmed in 1922. In 1925, the "Companhia Portuguesa Rádio Marconi" (CPRM) was set up and took on all responsibilities of the previous concession.
In 1970, CTT became a Public Company and in 1989, the TLP was transformed into a Limited Company, and was completely controlled by the State.
In 1992, the Portuguese government and the Public Service Television Corporation RTP
agreed to separate the transmitter network from the rest of the corporation, transferring it to a recently created state-owned company named "Teledifusão de Portugal" (TDP). The purpose of this was to explore a nationwide TV broadcasting network available for any TV station in Portugal to request its services. At the time, RTP (a "native" client of TDP) was having competition for the first time since its creation in the 1950s. SIC required the services of TDP, but TVI decided to create its own transmitter Network (RETI).
In 1992, CTT became a Limited Company with public capital and the Comunicações Nacionais, SPGS, SA (CN) was created, a state holding company responsible for the managing of all state participation within the sector - CTT, TLP, CPRM e TDP. In this same year, the Telecommunications developed by CTT was automatized through the creation of Telecom Portugal, SA, giving CTT the possibility to dedicate itself exclusively to the Post Office. With this, Portugal had its own telecommunications network which was being explored by 3 operators: the TLP explored the telephone services in the Lisbon and Porto areas, Telecom Portugal was responsible for the remaining national, European and Mediterranean communications; and Marconi took hold of international traffic. In 1994, a unique national telecommunications operator was created with the fusion of companies within the CN State holding: Portugal Telecom, SA (PT), with the fusion of Telecom Portugal, TLP and TDP.
Portugal Telecom was the only telephone operator in Portugal, being a monopoly
, until 1994, when the government gradually retired its control over the corporation and, in 2000, Portugal Telecom became a publicly owned company. Since then, it has held a dominant position in the liberalized Portuguese market.
In early 2007, the Portuguese conglomerate, Sonae
's takeover
offer for Portugal Telecom failed. PT's board rejected an initial bid, worth EUR 11.1 bn, in February 2006. Sonae.com's takeover bid opposed Belmiro de Azevedo
(founder and historical chairman of Sonae
holding company) and his son Paulo Azevedo (then the head officer of Sonae.com telecommunications operator) to the investor José Berardo
and PT's administrators Zeinal Bava and Henrique Granadeiro. In April 2007 the European Commission
gave an ultimatum to the Portuguese government ordering it to give up on the 500 golden share
s pack that it owned on the company and that enable special veto powers to the government on vital issues. This could give the government a decisive role in the bid by any company to buy Portugal Telecom. In November 2007, Portugal Telecom spun off its media assets (PT Multimédia), that included TV Cabo
and Lusomundo
Cinemas. In January 2008, the European Commission
began legal proceedings against the Portuguese government over its 'golden share' in incumbent telecoms operator Portugal Telecom. The 500 golden shares with extended voting rights, allowing it to block potential takeover bids, were the reason for the Commission's legal action. Similarly, in November 2005, the Commission had forced the Spanish government
to give up its golden share in the other telecommunications' major player in the Iberian Peninsula
, the Spanish telecoms giant Telefónica
.
In December 2009, Portugal Telecom purchased RETI.
operator in Portugal. Its operating brands include meo, a triple play
service provider and SAPO, an ISP
and producer of web content. Portugal Telecom also owns Telecomunicações Móveis Nacionais
(TMN), the largest mobile phone operator in the country; PT PRO, one of the largest shared services
companies in Europe; and PT Prime, an IT services
company.
PT also owns 25% of Páginas Amarelas, S.A., the publisher of the Portuguese edition of the Yellow Pages
.
is Portugal Telecom's second-largest market. PT agreed to acquire 22.4% of Telemar Norte Leste (Oi), the country's largest telecommunications firm, in July 2010. Separately it also holds 29% of UOL
, a major Brazil-based ISP and online service provider
; and is the sole owner of Dedic, a call centre
operator. PT previously held 29.7% of Vivo, the country's largest mobile phone network, which it controlled jointly with Telefónica
. It agreed however to sell its stake to Telefónica for €7.5 billion in July 2010.
Portugal Telecom's other main international assets are based in Africa and Asia, largely in Portuguese
-speaking nations. Through a 75%-owned investment holding company
Africatel, PT holds an effective 18.75% of Angola
's largest mobile operator Unitel; 30% of Cabo Verde Telecom (CVT) of Cape Verde
; 38.25% of Companhia Santomense de Telecomunicações (CST) of São Tomé and Príncipe
; and 25.5% of the Namibia
n mobile firm MTC
. The firm sold a 32% shareholding in Méditel
of Morocco in September 2009.
In Asia
Portugal Telecom owns 28% of Macau
firm CTM (Companhia de Telecomunicações de Macau) and 41.1% of Timor Telecom of East Timor
.
. As of 15 November 2011 its major stockholders are Espírito Santo Financial Group
(11.30%), RS Holding (10.05%), Capital Research and Management (9.97%), Telemar Norte Leste (7.00%), Caixa Geral de Depósitos
(6.23%), Brandes Investment Partners
(5.24%) and Norges Bank (5.01%).
After privatisation the Portuguese government owned 500 golden shares
in PT, which carried special rights over the company's management decisions and blocked any one shareholder from holding more than 10% of voting rights within the company. The golden shares were the subject of a long running dispute between the government and the European Commission
, which alleged that their existence was illegal under EU law
. Portugal argued that the shares were in the public interest
. A case brought before the European Court of Justice
by the Commission to force the government to cede its shares resulted in the announcement of their abolition in July 2011.
Telecommunications Service Provider
A telecommunications service provider or TSP is a type of communications service provider that has traditionally provided telephone and similar services...
in Portugal
Portugal
Portugal , officially the Portuguese Republic is a country situated in southwestern Europe on the Iberian Peninsula. Portugal is the westernmost country of Europe, and is bordered by the Atlantic Ocean to the West and South and by Spain to the North and East. The Atlantic archipelagos of the...
. Although it operates mainly in Portugal and Brazil
Brazil
Brazil , officially the Federative Republic of Brazil , is the largest country in South America. It is the world's fifth largest country, both by geographical area and by population with over 192 million people...
, it has also a significant presence in Guinea-Bissau
Guinea-Bissau
The Republic of Guinea-Bissau is a country in West Africa. It is bordered by Senegal to the north, and Guinea to the south and east, with the Atlantic Ocean to its west....
, Cape Verde
Cape Verde
The Republic of Cape Verde is an island country, spanning an archipelago of 10 islands located in the central Atlantic Ocean, 570 kilometres off the coast of Western Africa...
, Mozambique
Mozambique
Mozambique, officially the Republic of Mozambique , is a country in southeastern Africa bordered by the Indian Ocean to the east, Tanzania to the north, Malawi and Zambia to the northwest, Zimbabwe to the west and Swaziland and South Africa to the southwest...
, Timor-Leste
East Timor
The Democratic Republic of Timor-Leste, commonly known as East Timor , is a state in Southeast Asia. It comprises the eastern half of the island of Timor, the nearby islands of Atauro and Jaco, and Oecusse, an exclave on the northwestern side of the island, within Indonesian West Timor...
, Angola
Angola
Angola, officially the Republic of Angola , is a country in south-central Africa bordered by Namibia on the south, the Democratic Republic of the Congo on the north, and Zambia on the east; its west coast is on the Atlantic Ocean with Luanda as its capital city...
, Kenya
Kenya
Kenya , officially known as the Republic of Kenya, is a country in East Africa that lies on the equator, with the Indian Ocean to its south-east...
, the People's Republic of China
People's Republic of China
China , officially the People's Republic of China , is the most populous country in the world, with over 1.3 billion citizens. Located in East Asia, the country covers approximately 9.6 million square kilometres...
, and São Tomé and Príncipe
São Tomé and Príncipe
São Tomé and Príncipe, officially the Democratic Republic of São Tomé and Príncipe, is a Portuguese-speaking island nation in the Gulf of Guinea, off the western equatorial coast of Central Africa. It consists of two islands: São Tomé and Príncipe, located about apart and about , respectively, off...
.
Due to its large market share, Portugal Telecom is considered a de facto monopoly in fixed telephony in Portugal.
History
The first telephoneTelephone
The telephone , colloquially referred to as a phone, is a telecommunications device that transmits and receives sounds, usually the human voice. Telephones are a point-to-point communication system whose most basic function is to allow two people separated by large distances to talk to each other...
experiments in Portugal connected Carcavelos
Carcavelos
Carcavelos is a parish in the Portuguese municipality of Cascais, about 12 km west of Lisbon. The village used to be known for the Carcavelos wine, but since the wine production is nowadays reduced, Carcavelos is better known among surfers because of the good surfing condition of the...
to the Central do Cabo in Lisbon
Lisbon
Lisbon is the capital city and largest city of Portugal with a population of 545,245 within its administrative limits on a land area of . The urban area of Lisbon extends beyond the administrative city limits with a population of 3 million on an area of , making it the 9th most populous urban...
, in 1877. In 1882, the Edison Gower-Bell Telephone Company
Edison Gower-Bell Telephone Company of Europe, Ltd.
The Edison Gower-Bell Telephone Company of Europe, Ltd. was organized on October 28, 1881.Its areas of operations covered all of continental Europe, excluding France, Turkey, and Greece....
was established in both Lisbon and Porto
Porto
Porto , also known as Oporto in English, is the second largest city in Portugal and one of the major urban areas in the Iberian Peninsula. Its administrative limits include a population of 237,559 inhabitants distributed within 15 civil parishes...
, to explore the respective telephone service concessions. In 1887, the concession was transferred to APT - The Anglo Portuguese Telephone Company, which was kept by the latter until 1968, the year in which the Public Company "Telefones de Lisboa e Porto" (TLP) was created. The Post Office, Telegraphs and Telephones (CTT
CTT
thumb|200px|right|A CTT mail delivery vehiclethumb|200px|right|A CTT traditional mail boxCTT Correios de Portugal, S.A.—meaning Postal Services of Portugal, plc—is the national postal service of Portugal. The acronym CTT comes from Correios, Telégrafos e Telefones—Post, Telegraph and Telephone—the...
) explored until this present day, the telephone service in the rest of the country. For the exploration of radiotelegraphy and wireless telephone, a contract with the Marconi's Wireless Telegraphy Company concession was confirmed in 1922. In 1925, the "Companhia Portuguesa Rádio Marconi" (CPRM) was set up and took on all responsibilities of the previous concession.
In 1970, CTT became a Public Company and in 1989, the TLP was transformed into a Limited Company, and was completely controlled by the State.
In 1992, the Portuguese government and the Public Service Television Corporation RTP
Rádio e Televisão de Portugal
Rádio e Televisão de Portugal, S.A.,commonly known as RTP, is Portugal's public service broadcasting organization. It operates four terrestrial television channels and three national radio channels, as well as several satellite and cable offerings....
agreed to separate the transmitter network from the rest of the corporation, transferring it to a recently created state-owned company named "Teledifusão de Portugal" (TDP). The purpose of this was to explore a nationwide TV broadcasting network available for any TV station in Portugal to request its services. At the time, RTP (a "native" client of TDP) was having competition for the first time since its creation in the 1950s. SIC required the services of TDP, but TVI decided to create its own transmitter Network (RETI).
In 1992, CTT became a Limited Company with public capital and the Comunicações Nacionais, SPGS, SA (CN) was created, a state holding company responsible for the managing of all state participation within the sector - CTT, TLP, CPRM e TDP. In this same year, the Telecommunications developed by CTT was automatized through the creation of Telecom Portugal, SA, giving CTT the possibility to dedicate itself exclusively to the Post Office. With this, Portugal had its own telecommunications network which was being explored by 3 operators: the TLP explored the telephone services in the Lisbon and Porto areas, Telecom Portugal was responsible for the remaining national, European and Mediterranean communications; and Marconi took hold of international traffic. In 1994, a unique national telecommunications operator was created with the fusion of companies within the CN State holding: Portugal Telecom, SA (PT), with the fusion of Telecom Portugal, TLP and TDP.
Portugal Telecom was the only telephone operator in Portugal, being a monopoly
Monopoly
A monopoly exists when a specific person or enterprise is the only supplier of a particular commodity...
, until 1994, when the government gradually retired its control over the corporation and, in 2000, Portugal Telecom became a publicly owned company. Since then, it has held a dominant position in the liberalized Portuguese market.
In early 2007, the Portuguese conglomerate, Sonae
Sonae
Sonae is a conglomerate, and is the largest private employer in Portugal. The company is primarily engaged in the operation of retail stores through its subsidiary Modelo Continente....
's takeover
Takeover
In business, a takeover is the purchase of one company by another . In the UK, the term refers to the acquisition of a public company whose shares are listed on a stock exchange, in contrast to the acquisition of a private company.- Friendly takeovers :Before a bidder makes an offer for another...
offer for Portugal Telecom failed. PT's board rejected an initial bid, worth EUR 11.1 bn, in February 2006. Sonae.com's takeover bid opposed Belmiro de Azevedo
Belmiro de Azevedo
Belmiro Mendes de Azevedo is a Portuguese entrepreneur, ranked by Forbes as the 605th richest person in the world , as well as the 2nd richest in Portugal, with an estimated wealth of US$2 billion...
(founder and historical chairman of Sonae
Sonae
Sonae is a conglomerate, and is the largest private employer in Portugal. The company is primarily engaged in the operation of retail stores through its subsidiary Modelo Continente....
holding company) and his son Paulo Azevedo (then the head officer of Sonae.com telecommunications operator) to the investor José Berardo
José Berardo
José Manuel Rodrigues Berardo, GCIH, more commonly known as Joe Berardo , is a Portuguese businessman, stock investor, speculator, and art collector. According to Portuguese magazine Exame, he has an estimated net worth of €598 million...
and PT's administrators Zeinal Bava and Henrique Granadeiro. In April 2007 the European Commission
European Commission
The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union's treaties and the general day-to-day running of the Union....
gave an ultimatum to the Portuguese government ordering it to give up on the 500 golden share
Golden Share
A Golden Share is a nominal share which is able to outvote all other shares in certain specified circumstances, often held by a government organization, in a government company undergoing the process of privatization and transformation into a stock-company....
s pack that it owned on the company and that enable special veto powers to the government on vital issues. This could give the government a decisive role in the bid by any company to buy Portugal Telecom. In November 2007, Portugal Telecom spun off its media assets (PT Multimédia), that included TV Cabo
TV Cabo
ZON Multimédia is a Portuguese media holding company whose main assets include a satellite, cable operator and ISP, a movie distributor and a virtual carrier of mobile phone services. Its services include cable television, cable internet and VOIP. ZON Multimédia is the spun off media arm of...
and Lusomundo
Lusomundo
Lusomundo is a Portuguese integrated media corporation founded in 1953, which has major interests in movie distribution, cinema theaters and media assets....
Cinemas. In January 2008, the European Commission
European Commission
The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union's treaties and the general day-to-day running of the Union....
began legal proceedings against the Portuguese government over its 'golden share' in incumbent telecoms operator Portugal Telecom. The 500 golden shares with extended voting rights, allowing it to block potential takeover bids, were the reason for the Commission's legal action. Similarly, in November 2005, the Commission had forced the Spanish government
Spanish Government
Spain is a constitutional monarchy whose government is defined by the Constitution of Spain. This was approved by a general referendum of the people of Spain in 1978...
to give up its golden share in the other telecommunications' major player in the Iberian Peninsula
Iberian Peninsula
The Iberian Peninsula , sometimes called Iberia, is located in the extreme southwest of Europe and includes the modern-day sovereign states of Spain, Portugal and Andorra, as well as the British Overseas Territory of Gibraltar...
, the Spanish telecoms giant Telefónica
Telefónica
Telefónica, S.A. is a Spanish broadband and telecommunications provider in Europe and Latin America. Operating globally, it is the third largest provider in the world...
.
In December 2009, Portugal Telecom purchased RETI.
Domestic
Portugal Telecom owns PT Comunicações, the largest landlineLandline
A landline was originally an overland telegraph wire, as opposed to an undersea cable. Currently, landline refers to a telephone line which travels through a solid medium, either metal wire or optical fibre, as distinguished from a mobile cellular line, where transmission is via radio waves...
operator in Portugal. Its operating brands include meo, a triple play
Triple play (telecommunications)
In telecommunications, triple play service is a marketing term for the provisioning of two bandwidth-intensive services, high-speed Internet access and television, and a less bandwidth-demanding service, telephone, over a single broadband connection. Triple play focuses on a combined business...
service provider and SAPO, an ISP
Internet service provider
An Internet service provider is a company that provides access to the Internet. Access ISPs directly connect customers to the Internet using copper wires, wireless or fiber-optic connections. Hosting ISPs lease server space for smaller businesses and host other people servers...
and producer of web content. Portugal Telecom also owns Telecomunicações Móveis Nacionais
Telecomunicações Móveis Nacionais
TMN – Telecomunicações Móveis Nacionais, S.A., headquartered in Lisbon, is Portugal's first mobile communications company, both chronologically and in market share.-Chronology:1991...
(TMN), the largest mobile phone operator in the country; PT PRO, one of the largest shared services
Shared services
Shared services refers to the provision of a service by one part of an organization or group where that service had previously been found in more than one part of the organization or group. Thus the funding and resourcing of the service is shared and the providing department effectively becomes an...
companies in Europe; and PT Prime, an IT services
Information technology
Information technology is the acquisition, processing, storage and dissemination of vocal, pictorial, textual and numerical information by a microelectronics-based combination of computing and telecommunications...
company.
PT also owns 25% of Páginas Amarelas, S.A., the publisher of the Portuguese edition of the Yellow Pages
Yellow Pages
Yellow Pages refers to a telephone directory of businesses, organized by category, rather than alphabetically by business name and in which advertising is sold. As the name suggests, such directories were originally printed on yellow paper, as opposed to white pages for non-commercial listings...
.
International
BrazilBrazil
Brazil , officially the Federative Republic of Brazil , is the largest country in South America. It is the world's fifth largest country, both by geographical area and by population with over 192 million people...
is Portugal Telecom's second-largest market. PT agreed to acquire 22.4% of Telemar Norte Leste (Oi), the country's largest telecommunications firm, in July 2010. Separately it also holds 29% of UOL
Universo Online
UOL once known as Universo Online, is a Brazilian online service provider and internet service provider. It is the leader in Latin America and the homepage portal is the biggest in the Portuguese speaking world.UOL is currently ranked at Alexa TOP 100...
, a major Brazil-based ISP and online service provider
Online service provider
An online service provider can for example be an internet service provider, email provider, news provider , entertainment provider , search, e-shopping site , e-finance or e-banking site, e-health site, e-government site, Wikipedia, Usenet...
; and is the sole owner of Dedic, a call centre
Call centre
A call centre or call center is a centralised office used for the purpose of receiving and transmitting a large volume of requests by telephone. A call centre is operated by a company to administer incoming product support or information inquiries from consumers. Outgoing calls for telemarketing,...
operator. PT previously held 29.7% of Vivo, the country's largest mobile phone network, which it controlled jointly with Telefónica
Telefónica
Telefónica, S.A. is a Spanish broadband and telecommunications provider in Europe and Latin America. Operating globally, it is the third largest provider in the world...
. It agreed however to sell its stake to Telefónica for €7.5 billion in July 2010.
Portugal Telecom's other main international assets are based in Africa and Asia, largely in Portuguese
Portuguese language
Portuguese is a Romance language that arose in the medieval Kingdom of Galicia, nowadays Galicia and Northern Portugal. The southern part of the Kingdom of Galicia became independent as the County of Portugal in 1095...
-speaking nations. Through a 75%-owned investment holding company
Holding company
A holding company is a company or firm that owns other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself; rather, its purpose is to own shares of other companies. Holding companies allow the reduction of risk for the owners and can allow...
Africatel, PT holds an effective 18.75% of Angola
Angola
Angola, officially the Republic of Angola , is a country in south-central Africa bordered by Namibia on the south, the Democratic Republic of the Congo on the north, and Zambia on the east; its west coast is on the Atlantic Ocean with Luanda as its capital city...
's largest mobile operator Unitel; 30% of Cabo Verde Telecom (CVT) of Cape Verde
Cape Verde
The Republic of Cape Verde is an island country, spanning an archipelago of 10 islands located in the central Atlantic Ocean, 570 kilometres off the coast of Western Africa...
; 38.25% of Companhia Santomense de Telecomunicações (CST) of São Tomé and Príncipe
São Tomé and Príncipe
São Tomé and Príncipe, officially the Democratic Republic of São Tomé and Príncipe, is a Portuguese-speaking island nation in the Gulf of Guinea, off the western equatorial coast of Central Africa. It consists of two islands: São Tomé and Príncipe, located about apart and about , respectively, off...
; and 25.5% of the Namibia
Namibia
Namibia, officially the Republic of Namibia , is a country in southern Africa whose western border is the Atlantic Ocean. It shares land borders with Angola and Zambia to the north, Botswana to the east and South Africa to the south and east. It gained independence from South Africa on 21 March...
n mobile firm MTC
MTC Namibia
Mobile Telecommunications Limited is a mobile telecommunications company in Namibia providing cellular access. It is currently the largest mobile operator in Namibia with over one million active subscribers. MTC was established in 1994 and was the only cellular provider in Namibia at that time...
. The firm sold a 32% shareholding in Méditel
Méditel
Méditel is one of three licensed telecommunications operators in Morocco. Its headquarters is based in Casablanca.Méditel obtained the second license of mobile telephony in Morocco in 1999...
of Morocco in September 2009.
In Asia
Asia
Asia is the world's largest and most populous continent, located primarily in the eastern and northern hemispheres. It covers 8.7% of the Earth's total surface area and with approximately 3.879 billion people, it hosts 60% of the world's current human population...
Portugal Telecom owns 28% of Macau
Macau
Macau , also spelled Macao , is, along with Hong Kong, one of the two special administrative regions of the People's Republic of China...
firm CTM (Companhia de Telecomunicações de Macau) and 41.1% of Timor Telecom of East Timor
East Timor
The Democratic Republic of Timor-Leste, commonly known as East Timor , is a state in Southeast Asia. It comprises the eastern half of the island of Timor, the nearby islands of Atauro and Jaco, and Oecusse, an exclave on the northwestern side of the island, within Indonesian West Timor...
.
Ownership
Portugal Telecom is a publicly-traded companyPublic company
This is not the same as a Government-owned corporation.A public company or publicly traded company is a limited liability company that offers its securities for sale to the general public, typically through a stock exchange, or through market makers operating in over the counter markets...
. As of 15 November 2011 its major stockholders are Espírito Santo Financial Group
Espírito Santo Financial Group
The Espírito Santo Financial Group is a portuguese holding company with headquarters in Luxembourg, founded in 1984. The group represents the interests of the Portuguese Espirito Santo Group, which has major investments in Portugal and Europe, Americas, Africa and Asia.The company is listed on the...
(11.30%), RS Holding (10.05%), Capital Research and Management (9.97%), Telemar Norte Leste (7.00%), Caixa Geral de Depósitos
Caixa Geral de Depósitos
Caixa Geral de Depósitos is a Portuguese state-owned banking corporation and the largest bank in Portugal.- History :*1876 — Caixa Geral de Depósitos was founded under the aegis of the Junta de Crédito Público....
(6.23%), Brandes Investment Partners
Brandes Investment Partners
Brandes Investment Partners is an investment advisory firm, managing assets for institutional and private clients worldwide. It was founded by Charles Brandes in 1974. Brandes Investment Partners currently manages $105 billion in investments....
(5.24%) and Norges Bank (5.01%).
After privatisation the Portuguese government owned 500 golden shares
Golden Share
A Golden Share is a nominal share which is able to outvote all other shares in certain specified circumstances, often held by a government organization, in a government company undergoing the process of privatization and transformation into a stock-company....
in PT, which carried special rights over the company's management decisions and blocked any one shareholder from holding more than 10% of voting rights within the company. The golden shares were the subject of a long running dispute between the government and the European Commission
European Commission
The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union's treaties and the general day-to-day running of the Union....
, which alleged that their existence was illegal under EU law
European Union law
European Union law is a body of treaties and legislation, such as Regulations and Directives, which have direct effect or indirect effect on the laws of European Union member states. The three sources of European Union law are primary law, secondary law and supplementary law...
. Portugal argued that the shares were in the public interest
Public interest
The public interest refers to the "common well-being" or "general welfare." The public interest is central to policy debates, politics, democracy and the nature of government itself...
. A case brought before the European Court of Justice
European Court of Justice
The Court can sit in plenary session, as a Grand Chamber of 13 judges, or in chambers of three or five judges. Plenary sitting are now very rare, and the court mostly sits in chambers of three or five judges...
by the Commission to force the government to cede its shares resulted in the announcement of their abolition in July 2011.