Academic year, Fall term part I. (20 Points) Reading. (10 points) Complete the text with one the words in the box. You will not need all the words

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Court
stated the above justification requirements, it addressed whether 
the requirements were met in the schemes of each of the countries. The French 
scheme was struck down because, although it pursued a justified objective 
(namely, to guarantee supplies of petroleum products in the event of a crisis), the 
measures employed went clearly beyond that which was necessary to do so. In 
addition, the Court considered that the French provisions lacked precision and 
allowed the government too much discretionary 
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power
to control the company in 
question, Elf-Acquitaine. 
The Portuguese scheme was struck down primarily because it prohibited the 
acquisition of more than a given number of shares by nationals of other member 
states. The Court reasoned that the Portuguese rule provided for the manifestly 
discriminatory treatment of investors from other member states, with the effect of 

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restricting free movement of capital. The Court rejected the 
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arguments which were based on economic grounds. 
On the other hand, the Court upheld the Belgian scheme, which was aimed at 
maintaining minimum supplies of gas in the event of a serious threat, as it met the 
justification requirements stated above. The objective of safeguarding energy 
supplies constituted a 
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legitimate 
public interest, and the Belgian scheme 
provided for the least restrictive means of attaining such and set out well-defined 
procedures. Although the discussed judgments address specific regulations in 
France, Portugal and Belgium, the principal reasoning of the Court may be 
extended to many other forms of special shareholder rights with which takeovers 
can be impaired or blocked which currently exist in the legal systems of certain 
member states. In Germany, the Volkswagen Act is now expected to come under 
closer scrutiny. This regulation caps the voting power of any shareholder in 
Volkswagen AG at 20%, regardless of the number of shares held. The German 
state of Lower Saxony, holding a share of close to 20%, has, by virtue of the Act 
and its complicated rules on proxy voting, a de facto majority of votes present at 
the annual general meeting. The EU Court has been quite clear in its reasoning that 
the objectives justifying an overriding interest of a member state must be of a 
public, general interest and that economic interests cannot constitute a valid 
justification for restrictions on the fundamental freedom of movement of capital. 
Whether the Volkswagen Act will stand up against 
such concerns 
remains to be 
seen, but it appears that the State might find it difficult to argue public reasons for 
an interest that is obviously, albeit for good historical grounds, an economic one.