The draft law that would prevent anyone but the Croatian state to hold more than 49 per cent of shares in oil company Ina is not in accordance with European Union (EU) regulations, the European Commission (EC) has said.

The Croatian government has proposed a law that would limit the ownership of Ina shares to 49 per cent for all other shareholders but the Croatian state. The new law – if accepted and enacted - would prevent Hungarian MOL from acquiring the majority stake ahead of parliamentary elections in December.

The European Commission's analysis shows the proposed law is not in accordance with EU rules.

"We expect the Croatian authorities to take that into consideration," the EC said.

It is not clear whether the government will even send the draft for parliamentary discussion tomorrow (Thurs), the last chance it has before the Parliament is dismissed on Friday, daily Vecernji List writes.