The cross-border mobility of companies within the European Community after the Cartesio ruling of the ECJ (original) (raw)
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Company’s Cross-border Transfer of Seat in the EU after Cartesio
Jean Monnet Working Papers, 2009
This paper analyses the present state of affairs of companies' cross-border mobility in the EU after the ECJ's judgment in Cartesio. This judgment is subject to an in-depth critical examination in light of the preceding case-law of the Court on companies' freedom of establishment. Departing from Cartesio the paper enters into the debate about the adoption of new harmonization measures designed to remove the existing barriers on companies' cross border mobility in the internal market that result from the divergent and deep rooted Member States' companies' private international law rules. The paper critically assesses the non-EU legislatives initiatives regarding the adoption of the long awaited 14 th company law directive on the crossborder transfer of registered office. It argues that such a harmonization measure should now be finally adopted allowing companies to transfer their registered office alone from one Member State to another. That legal instrument must, in any event, respect the boundaries of the 'abuse of law' put forward by the Court in Cadbury Schweppes in the context of the exercise of the community right of establishment by companies in the EU.
Revista General de Derecho Europeo, 2022
ABSTRACT: The construction of the European Union Single Market requires the elimination of all the barrier to the freedom of establishment of companies as well as the adoption of uniform, or at least harmonized rules for their mobility. Arts. 49 and 54 of the TFUE provide and guarantee the possibility the companies to be constituted according to the law of a Member State and to carry out their economic activities in another EU Member State. One of the main obstacles for the corporate mobility, are the differences between the national legislations regarding the legal status of the companies and the connecting factors to determine the “proper law”. Whenever the company participates in international operations, different problems of private international law character may arise. Thus, becomes necessary to identify the specific national law (lex societatis) to govern the company, so this State will have the jurisdiction to set out legal rules as well as jurisdiction to resolve legal conflicts. The differences between the national legal systems criterions to determine de lex societatis have been gradually eliminated by the ECJ case law by confirming the application of the incorporation theory as a leading principle of the company mobility in the EU. The evolution of the ECJ case law in the field of free movement of companies, form Centros to Polbud, have strongly influenced the EU legal rules encouraging the adoption of Directive 2019/2121. The Directive provides a common set of rules aiming at to standardize the three forms of corporate conversions - change of legal form, division and merger - as well as to promote the legal mobility of corporations within the European Union.
Corporate Mobility under Private International Law and European Community Law: Debunking Some Myths
his paper examines corporate mobility from a private international law perspective and a European Community law perspective. It considers the two important conflicts of laws theories: the incorporation theory and the real seat theory. It looks at the rationale behind these theories and the long-standing dichotomy between incorporation States and real seat States. The paper examines how the application of the incorporation theory and the real seat theory affect corporate mobility in a number of scenarios. The emphasis of the paper is on corporate mobility in the European Community context. The provisions of the EC Treaty furthering cross-border corporate movement and relevant secondary legislation are examined. The limitations of the current legislative framework are appraised and attempts to enact legislation dealing specifically with corporate mobility are evaluated. Important case law of the European Court of Justice is also assessed. Six cases are analysed: Daily Mail, Centros, Überseering, Inspire Art, SEVIC and Cartesio. The effect of these cases on cross-border transfers of seat is considered. Also, general trends arising from the judgments are depicted and contrasted with entrenched assumptions under private international law. The paper concludes with an overall assessment of the extent to which obstacles to cross-border mobility have been eliminated as a result of Community law.
Corporate Mobility in Private International Law and European Community Law: Debunking Some Myths
Yearbook of European Law, 2009
This theory originated from nations that were keen to adopt a liberal approach to trade. 5 Under this theory, the existence and dissolution of a company are determined by the State of incorporation. Furthermore, the internal affairs of the company (e.g. matters of legal status, standing, rules on corporate governance, relationship between company, directors and shareholders, dissolution, liquidation etc) are regulated by the law of the State of incorporation. 6 This is irrespective of any activities, minimal or substantial, pursued in other States. Therefore, once a company has satisfied the formation requirements in its State of incorporation, then it is recognised everywhere. 7 In other words, when the incorporation theory is used for determining governing law, the same theory tends to be used for the issue of recognition. 8
The Transfer of Seat of Companies within the European Single Market
Law Review, 2020
The company law in Europe continues showing a difference of opinions in relation to the transfer of a company seat from one system to other, affecting the well functioning of the Single Market and the principle of freedom of establishment provided by the Treaty, no matter the way those organisations want to move, the Court of Justice being the only one offering, in time, clarifications and decisive solutions, many of them limiting the member states’s action in restraining the freedom of establishment of companies. As a consequence, the caselaw on transfer of seat of companies from one member state to another, rather timid at the beginning, but approaching a more bold attitude recently, become more favourable towards the acceptance of the freedom of establishment in most cases of transfer, the national company law, especially the provisions on conflict of law, facing a new challenge in the harmonisation of the provisions related to incorporation, functioning, merger/division/conversion or the creation of secondary establishments. Moreover, the development of the market, leaning towards a speedy digitalisation, forces both the institutions and the members states to take measures to solve the problem of transfer of seat of companies in a more integrated market and one of the steps made in this way was the adoption of the Company Law Package, by which the European Union addressed two crucial issues: the use of digital tools by the companies and the cross-border conversions, mergers and divisions. The article follows the main developments of the treaty provisions and caselaw in relation to freedom of establishment and transfer seat of companies, especially the pivotal decisions of the Court of Justice which made possible for the new attitude in the field and analyses the possible structural implications of the new provisions on cross-board conversions.
2018
This article focuses on mobility of companies in the European Union in the light of the Court of Justice’s judgment in the C-106/16 Polbud – Wykonawstwo sp. z o.o. case.1 The Court of Justice has once again interpreted the treaty provisions relating to the EU freedom of establishment in the context of cross-border conversion of companies. The in-depth analysis of the case from the substantive law perspective as well as from the conflict-of-law perspective has raised some doubts with regard to the background of the judgment. Therefore, the article assesses whether the cross-border transfer of a seat took place in the Polbud case or the cross-border conversion, or possibly a new company has come into existence. Most of the analysis is aimed at exposing the risks related to the companies’ mobility under the rules adopted in the Polbud judgment, in particular in the absence of respective European and national regulation.
Transfer of Corporate Seat in EU: Recent Developments
ATHENS JOURNAL OF LAW
Transfer of corporate seat has been important legal topic in EU law ever since 1980's. While it was clear from the wording of the very first EEC treaties, that companies should benefit from a freedom to establish themselves in another Member State, the extent of this freedom was, more or less, unclear. Some useful guidance with regard to the issue when and under what circumstances a company can transfer its corporate seat and its activities to another Member State, have been given by the ECJ. Every new Court's decision regarding transfer of corporate seat (such as ECJ decisions in case Centros, Inspire Art, Überseering, Daily Mail, Cartesio) had huge echo among corporate lawyers and business and were analysed in the smallest details. The most recent ECJ decision in Polbud case again showed that transfer of corporate seat is topic that still raises number of legal questions. In that sense, paper will analyse relevant EU legislation applicable to corporate mobility. It will particularly focus on new proposal of the Directive 2017/1132 on cross-border conversion, mergers and divisions and possible impacts of that Directive to corporate mobility. Special attention will be given to the ECJ ruling in Polbud case in which ECJ had to decide on delicate question as to whether or not companies should be allowed to "change nationality".
CROSS-BORDER TRANSFER OF THE REGISTERED SEAT-A CINDERELLA OF THE FREEDOM OF ESTABLISHMENT
SGEM 2014 International Multidisciplinary Scientific Conferences on Social Sciences & Arts, Political Sciences, Law, Finance, Economics & Tourism, Conference Proceedings, volume I, ISBN: 978-619-7105-25-4, ISSN: 2367-5659, Published by STEF92 Technology Ltd., Sofia , 2014
We would have expected perhaps that the surprising statement made in 1997 by a French author, H. Le Nabasque-the European company law is not a right of mobility of companies to become today an outdated paradox. And yet, while the right of secondary establishment (externalized prerogative to establish subsidiaries, branches, agencies on the territory of Member States-other than the State of origin) became a real benefit of the internal market, the right of primary establishment (more exactly, the transfer of the company seat from one Member State to another) knows some limitations, at least in the current status of the EU law (I). The case-law progress, meaning the actual militant action of CJEU in the purpose of liberalization of the right of establishment via the famous ruling Centros, , Inspire Art contributed not only to the determination of the prohibited restrictions to exercising the right of secondary establishment, but also to the admission of the intra-Community transfer of the company actual seat. The above mentioned caselaws and, newly, the contributions (even partial) marked by the solutions of Cartesio or Vale are insufficient, in the absence of a judgment comparable to that imposed in Sevic AG on cross-border mergers, to actually and under certainty and legal predictability conditions ensure the transfer of the registered office from one Member State to another (II). Excepting the Regulations on the European company (SE), the European Economic Interest Grouping (EEIG) and the European Cooperative Society (SCE), no secondary text authorized the transfer of a company seat from one Member State to another without dissolution followed by reconstitution of the company on the territory the new headquarters is intended to be set. In other words, while SE, EEIG and SCE enjoy the competitive advantage of complete intra-community mobility for the national companies, the transfer of the statutory seat from one Member State to another becomes a difficult operation given the legal and fiscal barriers imposed by the laws of the Member States. In 2007, the European Commissioner Mac Creevy announced the abandonment of the 14th Directive proposal on the cross-border transfer of the registered office; thereafter the topic seems to be re-enlisted on the political agenda of the European policy makers: the European Parliament resolution of 2 February 2012 covering recommendations to the Commission for adopting a directive in this field was followed by the public consultation launched of January 2013 (III). Moreover, the revival of the interest manifested in the legal environments is clear in reiterating the principle rules on which such a legislative initiative might rely on: the continuity of the legal personality, limiting the scope to equity companies and private limited companies, ensuring a rigorous procedure governing the transfer, the
Cross Border Movement of Companies: The New Eu Rules on Cross Border Coversion
2019
Cross-border companies' mobility is issue which has been gaining public attention in Europe since the end of the 1980's. Although it is clear, from the wording of the articles 49 and 54 of the TFEU, that companies should benefit from a freedom of establishment, in practice, the scope of this freedom is quite unclear. Companies wishing to move abroad are usually facing insurmountable obstacles which are still, more than 30 years after the famous Daily Mail case, very present. The recent EU legislative activity may finally bring this problem to an end. In April 2018 the European Commission proposed new rules on cross-border mobility. By enacting the Proposal of the Directive on cross-border conversions, mergers and divisions European Commission introduced important novelties to the cross-border mobility with an aim to simplify procedures, bring legal certainty and create such a legal environment which will enable companies to operate easily on the Single Market. In this paper authors will analyse only the rules of the Proposal that apply to cross-border conversions of companies. The new Proposal on cross-border conversions seem to be an adequate tool for companies that wish to convert abroad. However, the process of conversion is far from being simple. It is a very specific, multi-layered process which involves different stakeholders and authorities and requires their coordinated action. Authors will provide for a critical overview of the proposed legal solutions with special respect to the recent ECJ decision in Polbud case, in which the ECJ reaffirm the right of companies to cross-border conversion.
Białostockie Studia Prawnicze
In this paper the author analyzes the free movement of companies between EU Member States, one of the most essential conditions enabling the freedom of business in the European Union. It is obvious that in every European country, the constitution and/or legal order guarantees the basic fundamental rights for the people and settles the exercise of power. In conducting the research it is very important to examine the appearance of the two fundamental freedoms which are the essence of present topic, the freedom to provide services and the freedom of establishment. Both rights are listed in the basic treaties of the European Union and their nature is explained herein through interpretation of the text of the treaties, and through the jurisdiction, by analyzing case law using the decisions of the Court of Justice of the European Union (CJEU). Th e research centres on the examination of the practical side of the freedom to provide services and freedom of business. Th e study is presented through analysis and evaluation of the decisions of the CJEU and the Hungarian national jurisdiction. Th e goal is to provide a general picture through the jurisdiction of the CJEU and to examine whether the rights mentioned truly emerge in real life. Older decisions have also been taken into consideration in this regard as they were fundamental to the founding principles of the freedoms discussed and their present regulation.