The European Commission has chastised Spain for its failure to implement the new capital requirements directive, following earlier criticism of Madrid’s attempts to hinder BBVA’s takeover bid for Sabadell. In a letter seen by Reuters, the Commission informed the Spanish government it was in breach of EU regulations concerning the single supervisory mechanism, the capital requirements directive, and parts of the Treaty on the Functioning of the European Union. While the letter did not specifically mention the takeover attempt, it stated that domestic measures in Spain were incompatible with the new Capital Requirements Directive VI (CRD VI) framework governing acquisitions and mergers.
The Commission previously challenged Madrid’s efforts to impede BBVA’s €16 billion bid for Sabadell, both prominent Spanish banks, which ultimately failed. Under Spanish law, the government could not prevent BBVA from acquiring Sabadell’s shares but held final authority over whether a merger proceeded, citing the need to protect jobs and competition. The Commission, however, deemed Madrid’s broad discretionary powers as unjustified restrictions on the freedom of capital movement, asserting that consolidations in the banking sector benefit the EU economy and are essential for achieving a banking union. The new CRD VI directive was slated for implementation by January 2026.
Madrid has maintained that its domestic regulations are fully aligned with European standards. An Economy Ministry spokesperson stated on Thursday that the government is intensively working on transposing the directive and incorporating the exclusive competence of the European Central Bank and the Bank of Spain in the supervision of bank mergers. Spain now has two months to respond to the Commission’s concerns and address the identified shortcomings. Should Madrid fail to provide a satisfactory response, the matter could ultimately be referred to the EU’s highest court.
