New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1913-01-27
TO PROTECT INVESTORS
France to Add British Company
Law to Its Own.
CRITICISM FOR PROJECT
Scheme Is Very Complex and
Believed Unlikely to Secure
Object in View.

! Paris. Jan. 1.-THE principle OF pro-
/ tecting the savings OF small Investors
! in France has produced supporters and
also determined adversaries in connection
with the proposed law against the dis
semination of insidious. false and mis-
! leading prospectuses spread broadcast
| among the public by anonymous persons
| who have been almost always able TO
| evade the law. The idea OF the new law
| is based on British legislation concerning
! the publicity of financial enterprises ana
/ the promotion of new companies and syn
! dicates The question discussed in nan-
cial circles is whether such legislation II
desirable IN principle, and. secondly, II
the project is likely TO fulfil its object.
! Some urge that it IL the duty of the state
! 10 jealously to watch over and safeguard
| the national wealth, while others con-
/ slider that these ever recurring investiga-
: tons. this constant meddling OF the state
/ in private affairs. have become abusive.
! The one class believes that grand
/ mOtherly nursing. that national nhahce
/ tied to the apron strings Of the MINISTRY
OF Finance. is the panacea Tor al wen
! regulated business operations under M
/ mediate government control. Ihe other
| school maintains that such ofhclai p'ole'-
! ton is a danger instead OF remedy, anu
! that nothin. can replace individual liberty
: and personal supervision. Ii Is urged that
I such dependency would encourage BIND
reliance ON government help in and ont
of season. and destroy all personal energy
s,.f, lat for 81
| that the state is assuming too heavy q
load in the proposed law anu WouId De
unabl. TO carry out the enactments IN
practice People would trust To the re-
sponsbility OF the state. responsibility
which the latter would not undertake III
! general financial transactions. Many De
lieve that the addition OF numerous new
! clauses and articles to the present laws
will only create an ineXtricaDle tansle
/ beneficial only TO the lawyers. The COM
mon law l. regarded as sufficient pro-
: lection.
! What. does the new Law propose? Sim
ply to introduce British legislation on the
top of existing French laws. But the
broad British laws on the public adyer-
! tisement of all financial undertakings
with the endless minutie OF French
[ administrative regulations superadded'
would MI a volume. Where botn laws
agree is in the public notice given oil the
concern. signed and detailed and holdinS
AS a binding principle the responsibility
: of the promoters In England the memo
iandum Of the AFFAIR must be signed
dated and registered. under the penalty
of I'M. which may reach - day ior
delay. Ia France notification OF the un-
dertaking must be- published ~ the bui-
/ lctin dcs announces legales ct ohhsa-
! torres" and the bills. prospectuses' ad-
vertisem.nts and circulars must be ideh-
iicaI with the description aud with the
/ date OF the insertion in the Bulletin.
/ The promoters must sign as well as the
! sellers the memorandum and attest to IL
/ sincerity. otherwise they will be liable 10
| fines IN France OF from 100 francs TO
! g0eo francs. and. In case of fraudulent
( intention. to a term Of imprisonment In
RESPECT TO newspaper advertisements the
English Law IL less stringent than the
/ French
The law adds that every promoter ana
! seller. a. we'll az those acting collectively
will be held liable 10 each stockholder Tor
any loss through the securities that may
| have been issued by them. Here the now
/ regulations adopt the British formula
! Every person named I'm the prospectus,
! such as manager or promoter, ana any
person who has authorized the issue Of
tho prospectus. will have TO pay com
/ pensation to any person who subscribed
| for shares or debentures and have SUI
| fored loss on the faith or the prospectus.
! without going into further detail OF the
proposed laws this may he added VIDE
publicity and numerous leaflets. copious
and obligatory information OF the clearest
sort. can but appeal TO every one looking
10 reform. and also the enforcement that
All founders and company promoters
should sign and guarantee the pledge Of
their own responsibility. The French text
| docs not seem To receive the same general
| approyal as the English law.
Because the French proposal seems 10
sgpravate greatly and complicate the
| English regulation. The proposed law OF
the Finance Minister has not yet passed
| through Parliament. and will, no doubt,
have TO undergo many amendments In the
committee stage. y. i. D.