Europe's top court says Spain broke EU law by trying to obstruct a German takeover of Spanish energy firm Endesa.
The European Court of Justice ruled that Spain broke competition rules by ignoring an order to remove conditions placed on E.On's bid.
E.On made its 42.5bn-euro ($60bn; Ј30bn) bid in February 2006 and it was approved by the European Commission.
The Spanish energy regulator placed 19 conditions on E.On's 2006 offer and ignored a deadline to remove them.
"By making the acquisition of shareholdings in undertakings in the energy sector and of certain of their assets subject to the prior approval of the national energy commission, Spain has infringed community law," the European Court of Justice said.
The European Commission took Spain to the court, accusing it of restricting the free movement of capital.
(BBC)
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