(BRUSSELS) - The European Commission said Thursday it will sue Portugal over rules that limit voting rights in Portuguese energy group EDP, but do not apply to the state.

The European Union's executive arm said that Lisbon had failed to justify the need for the special powers after it asked Portugal to drop the measures in June 2007.

The rules limit voting rights of shareholders owning more than five percent of the company's stock with the exception of the state and bodies controlled by it.

"The commission considers that, in violation of (EU) rules, these special powers constitute unjustified restrictions," Europe's top competition watchdog said in a statement.

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