The Proprietatea Fund lost the lawsuit against Romgaz

• Laviniu Beze, AIPC: "This decision will sentence the Romanian capital market to underdevelopment"

The state will get to keep the donation of 400 million lei made by "Romgaz". This ruling is definitive and irrevocable, the court ruled in the lawsuit in which the Proprietatea Fund challenged the decision of the shareholders, of November 2010.

The lawyers of Boştină and Asociaţii, which provided legal representation to Romgaz, did not wish to comment yet.

The Ministry of the Economy, which holds 85% of the shares of Romgaz, voted at the company"s General Shareholder Meeting of November 30, 2010, that the company would donate 400 million lei to the state budget, based on a government decision. The worst hit was the Proprietatea Fund, which holds 15% of "Romgaz", which even filed a lawsuit against the decision. The officials of the Fund were not the only ones to react negatively to the state"s behaviour.

"Romania once again proves that justice is subservient to some politicians who don"t even understand the elementary notions of economics", Laviniu Beze the president of the Association of Capital Market Investors (AIPC) said yesterday. According to him, this decision sentences the Romanian capital market to underdevelopment and no nation can grow its economy if it doesn"t understand the role and the importance of the stock market. He added: "The fact that shareholder rights are disregarded in Romania, will sooner or later lead to Romania being condemned by the rest of the world, aside from the immediate effect that we will only be able to attract investors at an increasingly higher discount, which will be detrimental to everybody, even to the politicians that leech the state budget. The case is so dramatic that even in 2011, I don"t think they do things like this even in African countries; the last similar case I remember was that of Venezuela, which nationalized the oil fields in 2007".

In December 2010, the US ambassador in Bucharest, Mark Gitenstein, criticized the decision of the officials of the Romanian state, made at the general shareholder meeting of "Romgaz", stating that it discouraged potential investors. The ambassador said that "according to the globally accepted corporate management standards, the state"s officials should have abstained from voting on this topic due to the inherent conflict of interest - even though the action was legal, according to the Romanian legislation".

In the beginning of the year, Valentin Ionescu, the managing director of the Bucharest Stock Exchange, said that this kind of decisions, (ed. note: the donation made by Romgaz) should come as a warning for investors. "It is obvious that no one, anywhere in this world, would like to be treated like that as minority shareholder", he said.

In the beginning of the year, Mark Mobius, the head of Franklin Templeton, the manager of the Proprietatea Fund, said that what happened at "Romgaz" was simply an expropriation.

Until the closing of the edition, the officials of the "Proprietatea Fund" could not be contacted for statements concerning the lawsuit against "Romgaz".