Martin Gelter Centros, the Freedom of Establishment for Companies, and the Court's Accidental Vision for Corporate Law (01 Feb 2015) Available at ECGI: http://ecgi.global/working-paper/centros-freedom-establishment-companies-and-courts-accidental-vision-corporate-law
In consequence of the three ECJ cases in Centros (1999), Überseering (2002), and
Inspire Art (2003), EU member states can no longer effectively apply the real seat theory to companies from other Member States or take other measures to avoid the circumvention of their own laws by foreign incorporation. Founders of companies can ? in principle ? ?pick and choose?
the best legal form from all Member States, a result that many policymakers and legal scholars had sought to avoid for decades. This chapter attempts to tell a short intellectual history of the debate. In the early years of the EEC, it was thought that company law would be harmonized to such a strong degree that the free movement of corporations would no longer raise any concern. When the harmonization program stalled, Member States felt justified in maintaining protectionist measures impeding free choice of corporate law. Many saw dicta in the Daily Mail case of 1988 as providing a justification for the real seat theory, whereas few observers paid attention to the Segers case of 1986, which seemed to be saying the opposite. The triad of Centros, Überseering and Inspire Art thus was a particularly disruptive surprise. The ECJ, was seen as opening the door to regulatory competition in European corporate law, and in particular to English Private Limited Companies flooding the continent. In the end, there was little ?offensive? regulatory competition, since no Member State had the incentive to capture a large part of the market for incorporation. Member States did, however, engage in ?defensive? regulatory competition by eliminating requirements in their laws that seemed to drive founders to the UK (even if it does not appear to be the reason why the popularity of the English Private Limited Company on the Continent ended after a few years). In consequence, the ECJ thus unwittingly nudged Member States toward a certain vision of corporate law that had never been intended by policymakers.
The regulation of related party transactions (RPTs) is today the single most important yardstick for the quality of corporate governance systems. It is also one of the thorniest issues because RPTs are a well-documented cause of abuse by...Read more
In response to the financial crisis, as a way to align incentives of originators and investors, new regulation in the US (Dodd-Frank) and the EU (CRR) requires issuers of asset backed securities to hold some skin-in-the-game, offering a set of...Read more
Codes of conduct are a well-accepted feature of European corporate governance. Listed corporations are obliged to annually state their compliance with a corporate governance code or to explain their non-compliance. Whilst it is agreed that...Read more
The paper surveys the corporate opportunities doctrine in four jurisdictions: the US, the UK, Germany, and France. Our analysis enables us to trace the development of the doctrine, exposing the way in which certain models of dealing with a...Read more