EN    EN EN 
 
EN    EN  COMMISSION OF THE E UROPEAN COMMUNITIES 
Brussels, 24.9.2008 
SEC(2008) 2486 
  
COMMISSION STAFF WORKING DOCUMENT 
Accompanying document to the 
 
Proposal for a directive of the European Parliament and the Council 
simplifying the rules of the Third and the Sixth Company law Directives 
Impact assessment 
 
{COM(2008) 576} 
{SEC(2008) 2487}  
 
 
 
 
EN 2   EN COMMISSION STAFF WORKING DOCUMENT 
Accompanying document to the 
 
Proposal for a directive of the European Parliament and the Council 
simplifying the rules of the Third and the Sixth Company law Directives 
Impact assessment 
 
TABLE OF CONTENTS 
1. Introduction ................................................................................................................ .. 5 
1.1. The EU acquis in company law.................................................................................... 5 1.2. Commission initiative to  simplify company law.......................................................... 5 
1.3. Context - Reduction of administrative burdens............................................................ 6 2. Procedural issues and consulta tion of interested parties .............................................. 7 
3. Main sources of information used................................................................................ 9 4. Problem definition...................................................................................................... 11 4.1. The directives on domestic mergers and divisions in today's business 
environment................................................................................................................ 11 
4.2. Reporting requirements in the context of a planned merger or division.................... 13 
4.2.1. Detailed written report on the draft terms of merger/division by the management ... 13 
4.2.2. Independent expert report........................................................................................... 14 4.2.3. Accounting statement................................................................................................. 16 4.2.4. Double reporting in the case of an in crease in capital or setting up of a new 
company linked to division of companies.................................................................. 18 
4.2.5. Simplified mergers and divisions between  parent companies and subsidiaries......... 20 
4.3. Publication and documentation duties........................................................................ 21 4.3.1. Publication of the draft terms of merger/division a nd of the merger/division 
itself......................................................................................................................... ... 21 
4.3.2. Documentation to be made available to shareholders ahead of the general 
meeting....................................................................................................................... 2 2 
4.4. Protection of creditors ................................................................................................ 24 5. Subsidiarity................................................................................................................ . 24 
 
EN 3   EN 6. Objectives.................................................................................................................. . 24 
7. Policy options and Analysis ....................................................................................... 25 7.1. Reporting requirements – measures ta rgeting all public limited-liability 
companies................................................................................................................... 26 
7.1.1. Option 1: No policy change ....................................................................................... 26 7.1.2. Option 2: Introduce the possibility, for shareholders, to renounce the written 
report of the management a nd the accounting statement ........................................... 26 
7.1.3. Option 3: Restrict reporting requirements to larger or to listed companies ............... 27 
7.1.4. Option 4: Repeal the reporting requirements in the directives................................... 28 
7.1.5. Comparing the options ............................................................................................... 28 7.2. Reporting requirements – measures with a view to companies that are set up or 
increase their capital in the cont ext of a merger or division ...................................... 31 
7.2.1. Option 1: No policy change ....................................................................................... 31 7.2.2. Option 2: Introduce a Member State op tion to grant an exemption from the 
reporting requirement under the Second Dir ective in the case of a division ............. 31 
7.2.3. Option 3: Introduce a mandatory exem ption from the reporting requirement 
under the Second Directive in the case of a merger, a public offer and a division.... 31 
7.2.4. Comparing the options ............................................................................................... 31 
7.3. Reporting requirements – measures con cerning simplified merg ers and divisions 
between parent companies and subsidiaries............................................................... 32 
7.3.1. Option 1: No policy change ....................................................................................... 32 7.3.2. Option 2: Removing the Member State options as regards simplified mergers 
and divisions............................................................................................................... 32 
7.3.3. Option 3: Ensuring that Member States  have to grant the possibility of 
simplified mergers/divisions ...................................................................................... 33 
7.3.4. Comparing the options ............................................................................................... 36 7.4. Publication and documentation duties........................................................................ 36 7.4.1. Option 1: No policy change ....................................................................................... 36 7.4.2. Option 2: Use a central Internet site for publishing the information ......................... 37 7.4.3. Option 3: Use the company's or another Internet site for publishing the 
information................................................................................................................. 38 
7.4.4. Comparing the options ............................................................................................... 39 7.5. Protection of creditors ................................................................................................ 40 7.5.1. Option 1: No policy change ....................................................................................... 40 
 
EN 4   EN 7.5.2. Option 2: Adapt creditor protection rule s to the provision in the modernised 
Second Directive ........................................................................................................ 40 
7.5.3. Option 3: Repeal the creditor prot ection rules in the directives................................. 40 
7.5.4. Comparing the options ............................................................................................... 40 7.6. Conclusion................................................................................................................ .. 41 
8. Monitoring and Evaluation......................................................................................... 42 ANNEXES ........................................................................................................................ ....... 43 
 
EN 5   EN 1. I NTRODUCTION  
1.1. The EU acquis in company law 
The EU company law directives establish di sclosure requirements for limited-liability 
companies and for the branches of these companies that are established in another Member State (First and Eleventh Directiv e), set minimum require ments concerning the 
capital of public limited-liability compan ies (Second Directive) and concerning the 
procedures for domestic mergers and divisi ons (Third and Sixth Directives) and for 
cross-border mergers (Tenth Directive) . Furthermore, the Twelfth Company law 
Directive introduced the possibi lity to found limite d-liability companies with a single 
member and more recent directives dealt with  the procedure to follow in the case of a 
takeover bid (Takeover bid Dire ctive) and with shareholder voting (Shareholders' rights 
Directive). 
Those directives that were adopted between  the 1960s and the 1980s have been updated 
several times in order to adapt them to new developments.
1 However, none of these 
amendments touched on the scope or the basic content of the direc tives concerned. They 
have remained fundamentally unchanged since their adoption. 
1.2. Commission initiative to simplify company law 
In July 2007, the Commission launched an initiat ive for a broad simplification exercise in 
the areas of company law, accounting and auditing. On 10 July  2007, it adopted a 
communication ("the Communication") setting out its ideas.2 
The Communication outlined two options for the simplification of the company law 
acquis :  
Option 1 considered keeping only the directives that cover cross-border issues. It 
proposed, therefore, the repeal of the direct ives on companies' capital (Second Directive), 
domestic mergers and divisions (Third and Sixth Directive), and single member 
companies (Twelfth Directive). 
Option 2 limited the exercise to some key simplification measures related to specific 
provisions of the directives. This limited appro ach would also give possibility to review 
e.g. the rules on the documentati on of a merger or a division (management reports, expert 
reports, etc.) or the creditor prot ection rules of the directives. 
The simplification initiative in company law is a key contribution to the wider Better 
Regulation/Simplification agenda, in particul ar the initiative to reduce administrative 
                                                 
1 In the context of the fourth phase of the Simpli fication of the Legislation on the Internal Market 
Process (SLIM), the First and Second Company law Directives were modernised; furthermore, the 
Tenth Company law Directive on cross border merger s and the Directive on the exercise of certain 
rights of shareholders were adopted. 
2 Communication from the Commission on a simplified business environment for companies in the 
areas of company law accounting and auditing (COM (2007)394, not published in the Official 
Journal); available on DG MARKT's website at  http://ec.europa.eu/internal_market/company/simplification/index_en.htm 
 
EN 6   EN burdens weighing on European co mpanies. The proposals deriving  from this initiative are 
foreseen in the Simplification Rolling Pr ogramme for adoption by the Commission in 
2008.3 
1.3. Context - Reduction of administrative burdens 
Unnecessary and disproportionate administ rative costs severely  hamper economic 
activity. In 2005, the Commission therefor e launched an Action Programme for 
measuring administrative costs and reducing ad ministrative burdens in order to improve 
the business environment for EU companies a nd to make the EU economies fit to meet 
the challenges of a more competitive global bus iness environment in which they have to 
operate.4 
The Action Programme was endorsed by the Spring European Council in March 20075. 
The European Council underlined that reducing administrative burdens is important with 
a view to boosting Europe's economy, especia lly given the potential  benefits this can 
bring for small and medium-sized enterprises (S MEs). It stressed that a strong joint effort 
of the European Union and the Member Stat es is necessary to reduce administrative 
burdens within the EU.  
A key part of the Action Programme cons isted of a large-scale measurement of 
administrative costs incurred by businesses in  meeting legal obligations to provide 
information. This baseline measurement is carried out by the consortium Deloitte/Capgemini/Ramboll on behalf of the Commission and covers obligations 
stemming from EU legislation and from nationa l measures transposing that legislation. 
The methodology used is based on the ‘EU Sta ndard Cost Model’, inspired by different 
variants of the Standard Cost  Model (SCM) currently used for measurements at national 
level by a number of Member States.
6 The EU measurement focuses on the thirteen areas 
with the most burdensome information obliga tions ("priority areas"), which included, 
among others, the area of company law, accounting and auditing. The results of the entire measurement exercise will be delivere d by the end of 2008. However, company 
law/accounting/auditing was designa ted as a pilot in that ex ercise, given that national 
measurements carried out in the years unt il 2006 and the results of the stakeholder 
consultation had identified that area as one  of the most burdensome areas of the EU 
acquis. Therefore, the final measurement re sults in these areas were made available 
already at the end of June 2008. 
                                                
 
3 "Second progress report on the strategy for simplifying the regulatory environment", Annex 1, 
Revision of the company law, accounting and auditing acquis (COM(2008)33, not published in 
the Official Journal, p. 23) 
4 See Communication from the Commission to the Council, the European Parliament, the European 
Economic and Social Committee and the Committee of  the Regions - "A strategic review of Better 
Regulation in the European Union" (COM(2006)689 final, OJ C 78, 11.4.2007, p. 9). For more detailed information on the programme see the website of DG ENTR: 
http://ec.europa.eu/enterprise/adm in-burdens-reduction/home_en.htm 
5 Presidency Conclusions of the Brussels European Council - doc. 7224/07 Concl 1 
6 The measurement has been conducted in the Czech  Republic, Finland, France, Ireland, Poland and 
Spain. Furthermore, existing data from Member St ates that which have already conducted baseline 
measurements where used (Netherlands, Denmark, UK and Germany). The data for the other Member States were obtained by way of extrapolation. 
 
EN 7   EN For the same reason, a first proposal for a directive modifying th e Third and the Sixth 
Company law Directives was included in the first package of "fast track" proposals adopted by the Commission in March 2007. Th is proposal aimed at repealing the 
requirement for an expert report in the context of a merger or a divi sion of public limited 
companies where all shareholders of the co mpanies concerned renounce to the need for 
such a report. The directive was adopted by the European Parliament and the Council on 
13 November 2007.
7 
2. P ROCEDURAL ISSUES AND CONSULTA TION OF INTERESTED PARTIES  
The content of the July Communication was submitted to the debate by the European 
Parliament, the Council and stakeholders. 
On 22 November 2007, the Competitiveness Co uncil adopted conclusions welcoming the 
simplification initiative in broad terms and stressed the importance of reducing administrative burdens in order to improve  the competitiveness of companies. The 
Council called on the Commission to exped ite consideration of  responses to its 
Communication and, where appropriate and pr eferably before the end of 2008, bring 
forward proposals, accompanied by impact assessments.
8 
On 21 May 2008, a report was adopted by the European Parliament which expresses 
general support for the simplification exercise but rejects the idea of a (partial) repeal of 
the EU company law acquis and indicates preference in princi ple, on the side of the 
Parliament, for limited simplification measur es (option 2 of th e Communication). The 
European Parliament further recalls that th e interests of all st akeholders, including 
investors, owners, creditors a nd employees, as well as the prin ciples of subsidiarity and 
proportionality, must be duly taken into account.9 
In addition, the Communicat ion invited Member State an d EEA governments along with 
stakeholders to submit comments on the pr oposals in writing by mid-October 2007. 
Contributions from eighteen Member St ate governments, one EEA country and 
110 stakeholders, including European bodies  and associations, originated from 
23 countries in total, of which 22 Member  States, were submitted. A report on the 
reactions received is available on the website  of the Directorate-General for Internal 
Market and Services (DG MARKT) at http://ec.europa.eu/internal_marke t/company/simplification/index_en.htm
.10 
Among those who reacted to the Communicati on, option 2 (limited simplification) was 
clearly preferred to op tion 1 (repeal/partial repeal). The main argument put forward was 
that these directives provide legal certainty  and that their repeal  would rather cause 
additional costs than lead to savings for co mpanies. However, about three quarters of 
                                                 
7 Directive 2007/63/EC of the European Parliament and of the Council of 13 November 2007 
amending Council Directives 78/855/EEC and 82 /891/EEC as regards the requirement of an 
independent expert’s report on the occasion of merger or division of public limited liability companies, OJ L300, 17.11.2007, p. 47. 
8 Council document 15222/07 DRS 48 
9 Report A6-0101/2008 
10 See also Annex 1 to this Impact Assessment. 
 
EN 8   EN those who took a position on the question whet her individual simplification measures 
should be proposed supported the idea. Th ey considered that the Company Law 
Directives are in some parts overly descriptive and restrict the flexibility of Member 
States and companies beyond wh at is really necessary.  
Furthermore, the High Level Gr oup of Independent Stakeholders11 was consulted 
alongside the work of the cons ortium that carries out the large-scale measurement of 
administrative costs. In February 2008, it gave a positive opinion on a second package of fast track proposals in compa ny law that included proposals fo r modifications of the First 
and the Eleventh Company law Directives
12. In two further meetings, it discussed further 
reduction possibilities in company law, acc ounting and auditing a nd adopted its final 
opinion on 10 July 2008. In this opinion, the group welcomes the efforts by the 
Commission to review the reporting requireme nts in these two directives and calls upon 
the Commission to present ambitious legisl ative proposals which realize as much as 
possible the reduction potential identified for these two directives whilst protecting both 
shareholders’ and creditors’ interest. 
The proposals that should follow-up the results of the communication and of the 
measurement were entered into the agenda pl anning of DG Internal Market and Services 
under reference no. 2006/MARKT/044. 
In April 2008, a Steering Group was formed to  monitor the progress of the impact 
assessment of the present proposal. The Steer ing Group was made up of representatives 
of the several Directorates-General who re sponded to the invita tion of DG Internal 
Market and Services to join the St eering Committee (the Legal Service, 
DG Employment, Social Affairs and Equal Opportunities and DG for Enterprise and 
Industry) and included a representati ve of the Secretariat-General. 
The Group met twice to evaluate the advanc e of the impact assessment, to provide 
guidance and drafting cont ributions and to approve the final document. 
The Impact Assessment report was examined by the Impact Assessment Quality Board 
on 2 July 2008. Following the Board's opinion, seve ral changes were made  to this Impact 
Assessment, in particular, the following: Th e assessment of burden reductions has been 
complemented using figures from the consor tium that were only made available in the 
course of the month of July. Some estimations  in the Impact Assessment report have also 
been amended following further scrutiny of th e assumptions and estimations presented by 
the consortium. Section 3 has been extended wi th an explanation of how the data from 
the measurement is calculated in general. This is supplemented throughout the document 
with further explanations of how some of the individual estimations have been 
calculated. The comments of the High Leve l Group of Independent Stakeholders have 
been inserted in section 2. Section 3 incl udes now an explanation of which reduction 
                                                 
11 See Commission working document "Reducing administrative burdens in the European Union 
2007 progress report and 2008 outlook", COM(2008)35;  
For details on the High Level Group of Independent Stakeholders see the website of DG ENTR at http://ec.europa.eu/enterprise/regulation/better_ regulation/high_level_group_is_en_version.htm 
12 Proposal for a Directive of the European Parliament and of the Council amending Council 
Directives 68/151/EEC and 89/666/EEC as regards publication and translation obligations of certain types of companies, COM(2008)194, not yet published in the Official Journal 
 
EN 9   EN suggestions in the measurement report are not  covered in the Impact Assessment report. 
Comments on the support from stakeholders , including national differences in this 
regard, have also been inse rted in section 3 and throughout the document. Section 4.1 has 
been extended with an explan ation of why an initiative is  particularly important for 
SME's. Further clarity as to the baseline scenario in section 7.1 has been provided. 
Moreover, sub-option (2) has been inserted in section 7.1.2 and sub-option (1) has been 
inserted in section 7.1.3. In section 7.6, an estimate of to what extent the envisaged 
reductions contribute to the global 25 % reduction target ha s been inserted. 
3. M AIN SOURCES OF INFORMATION USED  
The main source of information on which this impact assessment is based is the large 
scale measurement of administrative costs, car ried out by the consor tium which delivered 
its report on 30 June 2008. Furthermore, the consortium provide d some additional 
information about the reduction potential of  possible simplification measures in an 
additional report of 31 July 2008.13 
In the measurement report, the total administ rative costs deriving from the EU rules on 
company law (including accounting and auditi ng) are estimated at a total of 22.74 bn 
€/year. 84.9% of these costs de rive from the obligations of the Fourth Company law 
Directive14 and another 4% from the Seventh Company law Directive15. About 11% (2.5 
bn €) are linked to the company law directives that do not deal with accounting and auditing matters. According to the report by th e consortium, about 25 % of these are so 
called "business as usual costs" that would ar ise even in the absence of legislation. For 
the accounting directives, these " business as usual costs" are es timated to lie at 40%. This 
means that the overall administrative burdens in the area of company law can roughly be 
estimated at about 1.88 bn €/year, and in  the area of accounting at roughly 12.13 bn 
€/year. 
The estimates in the report by the consortium  are made using the EU Standard Cost 
Model. The basic principle in the model is to  calculate, on the basis of interviews with 
companies, the costs per occurrence (one ty pe of occurrence could for instance be 
preparing draft terms of merger) and multip lying with the total (average) number of 
occurrences in that Member State per year. Then the tota l costs per Member State per 
year are summoned. The consortium has a pplied this method in 6 Member States
16, 
                                                 
13 Although these two reports have been delivered as final versions, minor adjustments in the version 
that will ultimately be published, at this stage, cannot be excluded. 
14 Fourth Council Directive 78/660/EEC of 25 July 1978 based on Article 54 (3) (g) of the Treaty on 
the annual accounts of certain types of companies, OJ L 222, 14.8.1978, p. 11, last amended by 
Directive 2006/46/EC of the European Parliament and of the Council of 14 June 2006 amending 
Council Directives 78/660/EEC on the annual  accounts of certain types of companies, 
83/349/EEC on consolidated acco unts, 86/635/EEC on the annual  accounts and consolidated 
accounts of banks and other financial institutio ns and 91/674/EEC on the annual accounts and 
consolidated accounts of insurance undertakings, OJ L 224, 16.8.2006, p. 1) ( . 
15 Seventh Council Directive 83/349/EEC of 13 June 1983 based on the Article 54 (3) (g) of the 
Treaty on consolidated accounts, OJ L 193, 18.7.1983, p. 1, last amended by Directive 
2004/46/EC). 
16 These Member States are the Czech Republic, Finland, France, Ireland, Poland and Spain. 
 
EN 10   EN reused data in another five Member States17 where national measurements had already 
been carried out, and extrapolated figures fr om the remaining 16 Member States using a 
method of categorising the Member States in groups depending on crite ria related to e.g. 
average wage rates, average size of co mpanies and total number of companies. 
The sometimes considerable differences, in the report, in administrative costs of different 
countries can, at least partially, be explained by the differences in these criteria. To this 
end, the measurement report groups th e Member States in three groups:  
– Large and established economies with high populations, high GDP, mainly 
limited liability companies and rela tively high wages (e.g. FR, DE, UK) 
– Smaller (mostly western European) econom ies with high wages, a generally 
highly educated labour force and a fairly high GDP (e.g. FI); and 
– Emerging (mostly Eastern European) ec onomies with above average growth 
in GDP, below average wages and relati vely low administrative costs (e.g. 
CZ, PL, BG)  
Another explanation is that in  the four countries where the national data were taken over 
for the purpose of the present measurement, the information obligations are not always defined in the same way as in the measurement by the consortium. Where this is the case 
with a view to a certain information obligat ion, this is indicated in the following, and 
where appropriate, these figures are not take n into account with a vi ew to calculating the 
total costs or potential savings. 
The figures and other information provided by the consortium have been complemented 
by information on national procedures direc tly requested from the Member States. 
Furthermore, also the summary report on th e reactions to the July 2007 Communication 
gives indications on where, in particular, th e companies themselves see possibilities for 
facilitating their lives. Therefore, this informa tion serves as a further basis for this impact 
assessment. In this context it should be noted that the reactio ns received and reflected in 
the impact assessment seem to be influenced to a significant extent by the geographical origin of the respondents. As set out in the summary report on the reactions to the Communication, around 20% of th e reactions derived from UK stakeholders and another 
20% from German stakeholders. French stake holders represented a bout 12% of the total 
respondents. Whereas a clear majority of  UK respondents and respondents from the 
Nordic countries strongly supported wide reaching simplification measures, French 
stakeholders and, at least in the area of company law, also a number of German 
stakeholders were more hesitant. The same  is true for the (f ewer) respondents from 
countries like Belgium and Austria. A possi ble explanation for these trends is that 
stakeholders in Member States that have been  part of the negotiati ons on these directives 
are closer to their system and therefore, see less a need for a change than stakeholders from Member States that joined the EU late r and were confronted with the directives 
only at the moment of their accession. From this point of view it would have been 
interesting to have more reactions from the new Member States , which, unfortunately, 
                                                
 
17 These Member States are Denmark, Germany, the Netherlands, the United Kingdom and, to a 
limited extent, Austria. 
 
EN 11   EN however was not the case. Another factor s eems to be that the current high level of 
harmonisation is useful for international gr oups of companies that are obviously more 
present in France and Germany than in smaller Member States. 
As to the number of public limited-liability companies concerned, th e 2006 survey of the 
European Companies' Registers Forum18 provides figures that are used in order to 
complement the information provided by the measurement. 
The impact assessment covers all reduction prop osals that the consortium puts forward in 
its report, with the exception of the proposal  to abolish the requirement for holding a 
general meeting in the acquiring compa ny. This proposal was put forward by the 
Commission in its July 2007 Communicatio n and rejected by two third of the 
respondents who reacted to this proposal. 
4. P ROBLEM DEFINITION  
The Third and the Sixth Compa ny law Directives belong to th ose company law directives 
that were adopted about 30 years ago. A number  of rules contained in  these directives no 
longer seem to match with the technologica l developments and with today's business 
environment. In addition, some requirements in  these Directives seem to imply costs for 
at least certain companies that are clearly di sproportionate to the pu rpose pursued by the 
rules, leaving too little flex ibility to Member States and companies to adapt the 
requirements to their situation. Also some rule s seem to be incoherent with more recent 
rules in other company law directives. Theref ore, simplification measures concerning the 
Third and the Sixth Company law Dir ectives going beyond the 2007 fast track 
modification were proposed in the July  2007 Commission Comm unication. When the 
second fast track package was prepared in March 2008, these proposals were not 
included in the list as they were not consider ed as suitable for a fast track procedure. 
They do not aim at minor legi slative changes but at a gene ral update and review of the 
requirements of these directives.  
4.1. The directives on domestic mergers  and divisions in today's business 
environment 
The Third and the Sixth Company law Directives  apply to mergers a nd divisions of those 
public limited-liability compan ies notified by the Member State in accordance with 
Article 1 of the Third Directive. 
In order to ensure an appr opriate protection of sharehol ders of these public limited-
liability companies in the case of a (domestic) merger or division, the directives establish 
certain information and publication duties that  the companies involved have to comply 
with. In addition, the direc tives contain rules for the protection of the companies' 
                                                 
18 European Commerce Regist ers Forum Survey 2006, 
http://www.ecrforum.org/section/8/index.html . The Forum is an orga nism that has been 
established in order to enhance cooperation between companies' registers in Europe. 
 
EN 12   EN creditors. The rights of the employees of the companies involved in the operation are 
dealt with by separate EU rules19. 
Despite the restriction of th e directives' scope to public limited-liability companies, 
almost all 21 Member States that replie d to questions asked by DG MARKT applied the 
same or similar rules to mergers and divisions  of private limited-liability companies, in 
particular with a view to the reporting requ irements established in the directives (see 
Annex 2). However, in about half of these Member States  members of private limited-
liability companies have the possibility to renounce (by unanimity) these reports. 
Reporting requirements are partic ularly burdensome for small en terprises. As stressed in 
the Commission's Small Business Act of 25 June 200820, rules should therefore be 
designed according to the "Think Small First" principle and ensure that exemptions for 
small enterprises are in place, in order to make their lives easier. 
In their current form, the Third and the Sixth Directives do not seem to match with this 
objective. They regulate the information obliga tions towards the companies' shareholders 
in a very detailed way and leave little flexibility to Member States and companies to adapt these requirements e.g. to  the size of the companies concerned and the number of 
their shareholders. The result is that in some cases the costs of complying with the 
requirements seem disproportionate to the pu rpose pursued. Furthermore, the ways in 
which information is to be provided (e.g. making documents available at the companies' registered offices, possibility of requesting pa per copies) seem rather old fashioned from 
today's point of view and are not in lin e with the methods applied by more recent 
directives, such as e.g. the Shareholders' Rights Directive
21. Finally, the directives do not 
take account of modifications that have been  made, in the recent pa st, to other EU acts 
which contain similar or related provisions , such as the Second Company law Directive 
on the capital of public limited-liability companies that was modified in 200622 and the 
Transparency Directive that was adopted in 200423.  
From the reactions received to the Communi cation and the preliminary results of the 
measurement of administrative burdens, it can  be concluded that a review of these 
Directives should look in partic ular at the following issues: 
– Reporting requirements in the context of a planned merger or division:  the current 
rules in the directives seem very detail ed and leave Member States and companies 
                                                 
19 Council Directive 2001/23/EC of 12 March 2001 on the approximation of the laws of the Member 
States relating to the safeguarding of employees' rights in the event of transfers of undertakings, 
businesses or parts of undertakings or businesses, OJ L 82, 22.3.2001, p. 16 
20 Communication from the Commission: "Implementing the Community Lisbon programme: Think 
Small First - A Small Business Act for Europe, COM(2008) 394, pages 7/8 
21 Directive 2007/36/EC of the European Parliament and of the Council of 11 July 2007 on the 
exercise of certain rights of shareholders in listed companies, OJ L 184, 14.7.2007, p. 17 
22 Directive 2006/68/EC of the European Parliament and of the Council of 6 September 2006 
amending Council Directive 77/91/EEC as regards the formation of public limited liability 
companies and the maintenance and alteration of their capital, OJ L 264, 25.9.2006, p. 32 
23 Directive 2004/109/EC of the European Parliament and of the Council of 15 December 2004 on 
the harmonisation of transparency requirements in relation to information about issuers whose 
securities are admitted to trading on a regulated market and amending Directive 2001/34/EC , 
OJ L 390, 31.12.2004, p. 38 
 
EN 13   EN little flexibility as to the appropriateness and the contents of the different reports. 
Furthermore, the fact that also the Second Company law Directive plays a role in the 
process leads to cases of doubl e reporting in particular in  the context of divisions; 
– Publication and documentation duties:  the ways by which documents have to be 
published and/or made available to sharehol ders is rather old fashioned and creates 
unnecessary costs; and 
– The protection of creditors in the context of the directives:  Here, a recent modification 
of a parallel rule in the Second Co mpany law Directive has led to certain 
inconsistencies within EU law. 
4.2. Reporting requirements in the contex t of a planned merger or division 
Under the Third and the Sixth Company La w Directives, companies that prepare a 
merger or a division are subj ect to a number of reporting re quirements. These reports are 
meant to inform shareholders about the le gal modalities of the operation, the economic 
background and the underlying fact s and data that led the ma nagement of the companies 
involved to propose a certain  share exchange ratio. 
The rules in the Third and Sixth Directives determine in a relatively detailed way what 
reports are required and from whom. Thus, a detailed written report  explaining the 
draft terms of the operation and setti ng out the legal and economic grounds24 is required 
from the management or administrative  bodies of the companies involved, a report of an 
independent expert  is needed in order to assess in particular whether the proposed share 
exchange ratio is fair and reasonable25 and an accounting statement  has to be drawn up 
if the latest annual accounts relate to a fina ncial year that ended more than 6 months 
before the date of the draft terms of merger or division26. Furthermore, in the case of a 
division where both an expert report under the Second Company law Directive and an 
expert report on the draft te rms of division are required, th e Sixth Directive only allows 
Member States to provide th at both reports can be es tablished by the same expert27; there 
is no exemption  from either of these reporting requi rements granted under any of the two 
directives. 
4.2.1. Detailed written report on the draft term s of merger/division by the management  
The draft terms of merger/division form the legal basis of the merger/division and are 
normally drawn up by the administrative or ma nagement bodies of each of the companies 
involved in the merger/divis ion with the help of exte rnal experts (lawyers, M&A 
specialists), and are to be published in the manner prescribed by the national law.28 
In order to explain the content of this lega l document to the shareholders, the company's 
management has to draw up a de tailed written report to the ge neral meeting where it also 
has to set out the legal and economic grounds for the merger/d ivision, in particular the 
                                                 
24 Article 9 Third Directive, Article 7 Sixth Directive 
25 Article 10 Third Directive, Article 8 Sixth Directive 
26 Article 11(1)(c) Third Directive, Article 9(1)(c) Sixth Directive 
27 Article 8(3) Sixth Directive 
28 Art. 5(1), Art. 6 Thir d Directive; Art. 3(1), Art. 4 Sixth Directive 
 
EN 14   EN basis for the exchange ratio and the criterion for the allocation of shares.29 This report, in 
most cases, is produced in-house so the cost s for the company are relatively limited.  
According to the measurement report the average cost of the detailed written report in the 
EU is 3,304 € for mergers and 10,079 € for divisi ons. However, these figures include big 
differences between the Member States. Disregarding some extreme figures from 
Germany and United Kingdom would make the av erage cost in the EU 689 € for mergers 
and 7,799 € for divisions.30 The latter differences in costs seem mainly related to the 
question whether the help of exte rnal experts is used or not.  
The measurement report indicates that for mergers , the total administrative costs 
(including external and internal costs) of requiring the detailed written report in the EU amount to around 7.79 mio €/year. 25% are estimated to be so-called "business as usual costs", so that the administrative burden is estimated to lie around 5.84 mio €/year.  
With a view to divisions , the corresponding total costs ar e about 7.98 mio €/year, but this 
figure only covers 23 Member States.
31 Assuming the costs of divisions, in the missing 
four Member States, are about the same as fo r mergers the total cost s for divisions can be 
estimated to 8.89 mio €/year, and the ad ministrative burden 6.67 mio €/year.  
As further discussed below in sections  4.2.2. and 7.1., the question is whether the 
requirement of the management report is really necessary in all cases, or if more flexible 
requirements would make better regulation. 
4.2.2. Independent expert report 
An additional document that the administrativ e or management bodies of each of the 
companies involved have to submit to their shareholders is a report by an independent 
expert on the draft term s of merger/division. 
While the report by the management fulfils ma inly an explanatory function, the expert 
report must look at the substance of the econom ic decisions that have been taken in the 
draft terms of merger/division having a direct impact on the situation of the shareholders. 
The requirement that the report has to be established by an independent expert (normally 
an auditor) serves to ensure that the share holders are provided with an objective basis for 
the decision on the merger/division that they  have to take in the general meeting. 
Given the need to employ an independent e xpert, the costs linked to this report are 
considerably higher than that of the repor t by the management. These costs consist 
mainly of the external costs (f ees to be paid to the expert) but also internal costs are 
                                                 
29 Art. 9(1) Third Directive; Art. 7(1) Sixth Directive 
30 The UK figure for divisions is 21 € (UK) and the DE figure for both mergers and divisions is 
68,005 € per incident. It is unknown to what extent these extreme figures are the result of 
differences in the method of measurement in the UK and DE national measurements compared to 
the measurement made by the Consortium. In general the average total costs per management 
report are between 250 and 1,750 € for mergers and between 3,000 and 19,000 € for divisions.  
31 The missing MS are DK, HU, IE and NL. 
 
EN 15   EN created by the need to appoi nt the expert and to provi de him with the necessary 
information.32 
According to the consortium the average cost  of the expert report in the EU is 41,774 € 
for mergers and 42,829 € for divisions. Agai n, these figures include big differences 
between the Member States. Disregarding so me extreme figures from Netherlands and 
United Kingdom would reduce the aver age cost to 19,432 € for divisions.33  
The measurement report estimates that for mergers  the total costs in the EU are 
estimated to be 330.86 mio €/year and th e administrative burden 248.15 mio €/year. 
For divisions , the corresponding total costs in  the EU are estimated to be 
108.23 mio €/year and the administ rative burden 81.17 mio €/year.34 
Despite of the different functions of the ma nagement report on one hand and the expert 
report on the other, there are obviously overl aps between the two reports. Both reports 
are required to elaborate on the draft term s of merger/division, especially the share 
exchange ratio and any special valuat ion difficulties which have arisen.  
For instance in the ca se of mergers between smaller public limited -liability companies  
with a limited number of shareholders and limi ted assets, an expert report might not be 
necessary. The situation might be sufficiently transparent on the basis of the written 
report of the management alone. The same goes for divisions of small public limited-
liability companies.  
In other situations, an expert report might be necessary but not an additional written 
report by the management, as, in order to evalua te the draft terms of merger or division, 
the expert report normally will need to describe  also the content of the draft terms more 
precisely. 
There even might be situations where neither of the two reports is necessary, for instance 
if all shareholders are also managing directors in the compa ny and therefore already have 
all relevant knowledge. 
Despite these possible overlaps between the two reports, and possible cases of 
redundancy, the Third and the Sixth Direc tives do not provide any possibility for 
exemption from any of the requirements. The only flexibility in this respect was 
introduced by Directive 2007/63/EC35 that provided that no e xpert report needs to be 
established where all sh areholders renounce it. Th is rule was copied from the more recent 
                                                 
32 Based on figures from the six Member States  where the consortium has made a measurement 
themselves the external costs acco unt for around 97% of  the total costs of an expert report. 
33 The figures from NL and UK are 22.50 € and 623,749 € respectively (both taken from the national 
measurements).  
34 The total figure from the consortium is 105,600,583 €, but this figure does not include DK. 
Assuming the costs from DK are the same as for me rgers the total costs in EU are 108,227,116 €. 
35 Directive 2007/63/EC of the European Parliament and of the Council of 13 November 2007 
amending Council Directives 78/855/EEC and 82 /891/EEC as regards the requirement of an 
independent expert's report on the occasion of merger or divi sion of public limited liability 
companies was published in the Official, OJ L 300 of 17 November 2007, p. 47. 
 
EN 16   EN Directive on cross-border mergers36 and has to be transposed  by the Member States by 
31 December 2008. 
The rules of the Third and the Sixth Company law Directives also do not take into 
account the flexibility introduced in 2006 into  the Second Company law Directive as 
regards the expert valuati on of a contribution in kind37. This modification allows Member 
States to grant an exemption from the requir ement for an expert report in three cases: 
(1) where the contributio n in kind consists of transferable securities traded on a regulated 
market, (2) where it consist of other assets that  have already been subject to a fair value 
evaluation by an independent expert less than  six months before the relevant date, and 
(3) where the fair value of th e contribution is derived by indi vidual asset from the audited 
statutory accounts of the previous financial year. 
The modification of the Second Directive had to be transposed by the Member States by 
15 April 2008. However, by 15 August, only 20 Member States had notified the transposition to the Commission, and it seems as if only very few of them have made use 
of this option concerning the expert report. 
4.2.3. Accounting statement 
Where the last annual accounts are older than six months at the moment where the draft 
terms of merger/division are drawn up, the ma nagement of each of the companies –listed 
and unlisted- involved also has to prepare an accounting statement. For this statement the 
management has to use the same method and la yout as for the annual balance sheet. The 
statement, however, does not  need to be audited.  
The accounting statement is one of the documents  which currently need to be provided to 
the shareholders at the company's register ed office one month ahead of the general 
meeting deciding on the merger/division and se nt to every shareholder, who requests it, 
free of charge.
38 This applies in principle both to  mergers/divisions by way of normal 
procedure and to the different cases  of simplified mergers/divisions.39 
The consortium seems to have measured only th ree of the information obligations in the 
Third and Sixth Directive where the preparation and disclosure to the shareholders of an 
accounting statement is relevant, namely the two main provisions and one of the 
simplified procedures for divisions.40 
As regards mergers  the consortium estimates that the costs of making available to the 
shareholders the different documents con cerned amount to 3.49 mio €/year in the EU41, 
                                                 
36 Directive 2005/56/EC of the European Parliament and of the Council of 26 October 2005 on 
cross-border mergers of limited liability companies, OJ L310, 25.11.2005, p. 1. 
37 See Art. 10a of Directive 77/91/EC, introdu ced by Art. 1(2) of Directive 2006/68/EC 
38 Art. 11(1) and (3) Third Directive and Art. 9(1) and (3) Sixth Directive. The other documents that 
need to be made available to the shareholders ar e the draft terms of merger/division, the annual 
accounts and reports of the merging/dividing comp anies for the preceding three financial years, 
the detailed written report by management and the independent expert's report. 
39 See Art. 8(b), 24, 25(b) and 27(b) Third Directive and Art. 6(b) and Art. 20(b) Sixth Directive. 
40 Only Art. 11(1) and (3) Third Directive and Art. 6(b) and 9(1) and (3) have been measured, but 
not Art. 8(b), 24, 25(b) and 27(b) Third Directive and Art. 20(b) Sixth Directive. 
41 Data missing from DK. 
 
EN 17   EN apparently only counting the number of occu rrences of normal procedure mergers. There 
are no "business as usual costs" in this case. 
The consortium assumes that 30% of the measured costs relate to producing the 
accounting statement and making it available to the shareholders afterwards. Given that 
the accounting statement can be extracted fr om the accounting system, does not require 
an audit and requires less pages to be copied  etc. than the three financial reports, the 
assumption of 30 % of the measured costs seems to be acceptable.  
If one applies this 30 % assumption to the measurement made by the consortium the cost 
savings that could be made in the EU if the accounting statement wa s not required at all 
can be estimated at about 1.05 mio €/year for normal procedure mergers. On top of this 
come the cost savings related to the simplif ied mergers regulated by Art. 8(b), 24, 25(b) 
or 27(b) Third Directive.  
As regards divisions  the consortium estimates that the costs of making available to the 
shareholders the different documents c oncerned amount to 0.24 mio €/year, only 
counting, however, the number of occurrence s of divisions carried  out in the normal 
procedure. On top of this come, total cost s of about 0.51 mio €/year regarding simplified 
divisions according to Art. 6( b) Sixth Directive. These costs are based on data from the 
14 Member States42 where a general meeting, under certain conditions, only is required 
in the dividing company.  
If one applies the 30 % assumption referred to  above the total cost savings in the EU 
would be around 0.23 mio €/year for these two ty pes of division. No figures are available 
regarding simplified divisions where the recipient companies together hold all the shares of the company being divided and therefor e only general meetings in the recipient 
companies are required.
43  
The objective of the requirement for an accounting statement is to provide the 
shareholders of listed and unlisted companies with an update on the assets and liabilities of the companies involved. However, the six months' deadline seems a bit arbitrary as 
events influencing the financia l situation of the company can arise any time and are not 
necessarily more likely five months after the annual accounts have been issued than two 
months after that date. Furthermore, as indicated above, in cases e.g. where all 
shareholders are involved in the manageme nt of the company the statement may not 
bring much added value for them. 
Finally, the rule in the Third and the Sixt h Directives on the acc ounting statement does 
not take account of the half y early financial statements that have to be prepared by listed 
companies under the rules of the Transparency Directive
44. Where such half-yearly 
statements have to be prepared, the necessary  financial information is already updated in 
a six months' rhythm so that the establishm ent of an additional accounting statement on 
the occasion of a planned merger or division does not seem necessary. At least in this 
respect, the current rules of the Third and the Sixth Directives therefore create 
unnecessary administrative burden. 
                                                 
42 These are: AT, CZ, FI, FR, EL, IE, IT, LT, LU, NL, SI, ES, SE and UK. 
43 Art. 20(b) Sixth Directive 
44 Art. 5 Directive 2004/109/EC  
 
EN 18   EN 4.2.4. Double reporting in the case of an incr ease in capital or setting up of a new 
company linked to division of companies 
An independent expert report has to be dr awn up, under the rules of the Second Company 
law Directive, when shares are issued for c onsideration other than in cash both in the 
context of setting up a company and in the c ontext of a capital increase in a company.45 
On the basis of that report, shareholders can verify whether the value of the non-cash 
consideration corresponds  to that of the shares issued in exchange. The purpose of these 
rules is, therefore, to avoid the danger of overvaluation (eith er of property or claims) to 
the detriment of the company and to protect the interests of shareholders and creditors.46 
Member States have the possibility to pr ovide for an exemption from the reporting 
requirement both where a new company is se t up by merger and where the capital is 
increased in the course of a merger or a public offer  for the purchase or exchange of 
shares.47 The reason for these possibilities is that, both in the case of a merger and of an 
exchange offer, the respective directives (the Third Company Law Directive and the 
Takeover bids Directive) provid e for a report which, although its scope is larger, has to 
include the information normally c ontained in the expert report.48  
However, the EU rules do not offer a similar exemption possibility in the case of setting 
up a new company or an increase of capital linked to a division  of a company, although 
the Sixth Directive contains the same rules on the expert report to be established as the Third Directive. Instead, under the rules of the Sixth Company Law Directive, Member 
States only have the possibility to provide that the report on the division and the report on 
the consideration in kind may be drawn up by the same expert.
49 This situation seems to 
be inconsistent and unnecessary burdensome at  least in those cases where the report 
under the Sixth Directive is indeed established.50 
It should be noted that the consortium ranks th e obligation to establish an expert report in 
the comparable case of a merger and the duty to have an expert report under the Second 
Directive fifth and eighth in the top 10 of most burdensome information obligations in 
company law.  
The consortium estimates the costs and also  the burdens of requi ring an expert report 
under the Second Directive in the context of divisions at about 66 mio €. This figure, 
however, is based on the erroneous assumption that one expert report drawn up under the 
Sixth Directive will always be accompan ied by one expert report under the Second 
                                                 
45 Art. 27(2), (3), Art. 10 Second Directive, Art. 10 Third Directive 
46 Cf. AG Tesauro, Case C-83/91 (Wienand Meilic ke), European Court reports 1992, I-4871, 
para 14, 19. 
47 Art. 27(3) Second Directive 
48 cf. Articles. 5, 9, 10 Third Directive; in the case of a takeover the report is the offer document, 
Art. 6(3) Takeover bids Directive (Directive 2004/25/EC of the European Parliament and of the Council of 21 April 2004 on takeover bids, OJ L 142, 30.4.2004, p. 12) 
49 Articles 8(3) and 22(4) Sixth Directive 
50 Any measure in this area should therefore be seen in the context of possible measures concerning 
the reporting requirements in the Third and Sixth Directives. 
 
EN 19   EN Directive.51 Moreover, the cost estimate from th e consortium does not take into account 
the expert report for considera tions other than in cash where the subscribed capital is 
increased in the course of a division.52 
It seems, therefore, more appropriate to calc ulate the total costs/burdens in this context 
on the basis of an estimated average cost per expert report under the Second Directive 
and to multiply this average with an estimate of the number of occurrences. 
According to the figures provided by the consortium , the average cost per occurrence in 
the EU when requiring an expert report for contributions in kind is 16,700 € in the 
context of setting up new companies and 11,180 € in the context of capital increases. Since, in the context of divisi ons, it is far more common to set up new companies than to 
increase the capital of existing companies,  a rough estimate of the average cost per 
occurrence in the EU can be set to around 15,000 €. 
The measurement report estimates that around 4,331 draft terms of divisions of public 
limited liability companies are produced in the EU per year.
53 However, for Denmark the 
consortium comes to very high figures as some of them are counted multiple times. Based on an estimate by the Danish Comm erce and Companies Agency (DCCA) the 
Danish figure is rather 327 than 2,806 making th e total number of draft terms of divisions 
1,852 in the EU per year. Since most, but not a ll, occasions of draf t terms of divisions 
lead to the division taking place, the number of divisions of public limited companies in 
the EU can be estimated to be around 1,800/year. 
According to an estimate provided by the DCCA , about half of all divisions of public 
limited liability companies in Denmark are ca rried out either by way of setting up new 
public limited liability companies or increasing the capital of existing companies that act 
as recipients for the assets and liabilities  of the company dividing. Taking into account 
that, in Denmark, divisions often involve priv ate companies as recipient companies that 
do not fall under the requirements of the Second Directive, it can be assumed that this 
50% assumption marks the lower end of the possible range for the whole EU. 
It would lead to assuming about 900 occurrence  in the EU per year and thus to costs of 
around 13.5 mio €/year. In an alternative scenar io where it is assume d that 1,300 cases of 
double reporting of this kind o ccur per year in the EU th e estimated costs would lie 
around 19.5 mio €, so that the to tal range of costs/burdens can be set around a level of 
between 13.5 mio € and 19.5 mio €/year. 
                                                
 
51 On the one hand the two expert reports need not have anything to do with each other (for instance 
if the recipient companies of a division of a public limited liability company are private 
companies, or if the recipient companies are existing public limited companies and they do not 
increase their capital as a consequence of the divisi on; in that case an expert report under the Sixth 
Directive is required but no expert report is required under the Second Directive). On the other hand one expert report drawn up under the rules of the Sixth Directive might necessitate several 
expert reports under the Second Directive (for instance if several new public limited companies 
are set up as a consequence of the division). 
52 Art. 27 (2) of the Second Directive.  
53 The consortium's figure is 4,327 but data is missing from IE and LT. Looking at the figures from 
other information obligations e.g. "Disclosure of division" suggests that the figures from these two Member States should be 0 and 4.  
 
EN 20   EN No matter whether the latter estimate is used or the consortiums estimate is used as a 
basis, these figures show that, apart from  the argument of cons istency, the current 
situation also can create considerable costs that appear to be a typical example of an 
administrative burden. In a modern busines s environment, double reporting should be 
avoided to the extent possible as it creat es additional costs for companies without 
providing real added value to shareholders and creditors. 
4.2.5. Simplified mergers and divisions betw een parent companies and subsidiaries 
The current rules of the Third and the Sixth Directives alre ady give Member States the 
possibility to facilitate mergers and divi sions between parent companies and their 
subsidiaries and, therefore, to  reduce the administrative cost s linked to these operations. 
These possibilities are, firstly, the possibility to grant an exemption from the requirement 
to hold a general meeting in  certain cases. S econdly, in certain cases, also the 
requirements concerning the documentation to be provided to the shareholders of some 
or all of the companies involved can be reduced. 
The problem for the companies is that both according to the information in the report 
from the consortium and that provided by the Member States (see Annex 3) only a few of 
the 27 Member States make full use of the possibilities described above (called in the 
following "simplified mergers and divisions").54  
Average costs on mergers and divisions could in most Member States be substantially 
reduced if companies were given the right to  make use of the exemption possibilities 
concerning simplified merg ers and divisions.  
Based on the information from the consortium,  the following example shows some of the 
differences in requirements and costs due to the implementation or non-implementation of the simplified procedures: 
Contrary to Spain, France has not implemen ted the simplified merger procedure in 
Art. 28 Third Directive according to which amongst others the obligations “Detailed 
written report on merger” and “Experts' repor t on merger” are, under certain conditions, 
not required. Partly as a result  of this, in Spain, for every 100  draft terms of merger there 
are only five detailed written reports being drawn up and five expert reports, whereas in 
France 96 and 71 reports respect ively are established. As shown in sections 4.2.1. and 
4.2.2., the average cost, in the EU, of a detail ed written report is 3,304 €, and 41,774 € in 
the case of an expert report  (in relation to mergers). 
There can be different reasons for the choi ce of Member States not to grant the 
exemptions: one can be a concern that mi nority shareholders are not adequately 
protected, another one can lie in  the ownership structure of co mpanies in that country (if 
mainly dispersed ownership some of the exemp tion possibilities will not be relevant).  
The concern that minority shareholders may not  be adequately protected, however, seems 
exaggerated, since the exemp tion possibilities also provide for minority protection rules 
(see the conditions set out in Annex 3, point 1). 
                                                
 
54 It seems as if only SK and UK make full use of all exemption possibilities (Art. 24-29 Third 
Directive and Art. 20 Sixth Directive).  
 
EN 21   EN 4.3. Publication and documentation duties 
4.3.1. Publication of the draft terms of me rger/division and of the merger/division 
itself 
The text of the draft terms of merger/divisio n has to be disclosed in accordance with the 
mechanisms provided for under the First Co mpany law Directive: the draft terms 
therefore have to be filed with the comp anies register and published in the Member 
State's national gazette or on a central electronic platform.55 The same applies to a 
merger or a division that have taken place.56 
On 17 April 2008, the Commission adopted a proposal that aims at reducing the 
administrative costs linked to the disclosure regime of the First Company law Directive. 
If this proposal is adopted by the European Parliament and th e Council, also the costs of 
a merger and a division will be reduced. The measurement report provides figures on the future savings with a view to the obligation to publish the fact that a merger/division has 
taken place. These are estimat ed at about 1.7 mio €/year.
57 Concerning the publication of 
the draft terms of merger/division, only figures  that also include the drawing up of the 
draft terms are provided. The total costs of drawing up the draft terms and publishing 
them are estimated at about 1.9 mio €/year58. The total future savings from the 
Commission proposal of April 2008, in the area of mergers and divisions can therefore 
roughly be estimated at between 2 and 3 mio €/year. 
However, not only the way in which the publica tion has to take place but also the use of 
the obligation, for the companies, to file the draft terms of  merger/division with the 
companies' register  can be questioned. The nature of the information contained in the 
draft terms is different from the other inform ation that has to be kept in the company's 
file (like name, address and names of pers ons entitled to represent the company): Once 
the decision on the merger/division has been taken and the deadline for contesting the 
operation has expired, the public interest in  that document seems to be limited. This 
temporary information need could also be sa tisfied by a publication of the draft terms of 
merger/division on a generally accessible website. 
The situation is somewhat different with a view to the filing of the merger/division 
itself : The two directives explicitly link a number of legal consequences to the merger 
and the division (transfer of assets and liabi lities, end of the existence of the acquired 
company/company to be divided). These are si gnificant, long term e ffects, so that it 
seems appropriate to maintain the existing disclosure regime in this respect.  
Whereas the filing costs for this latter inform ation, therefore, seem unavoidable, the costs 
caused by the obligation to file also the draft  terms of merger/division do not appear 
justified. Even once the additional costs curr ently caused by the publication obligation 
                                                 
55 Art. 6 Third Directive, Art. 4 Sixth Directiv e and Art. 6(1) of Directive 2005/56/EC of the 
European Parliament and of the Council of 26 October 2005 on cross-border mergers of limited 
liability companies, OJ L310, 25.11.205, p. 1 
56 Art. 18 Third Directive, Art. 16 Sixth Directive 
57 About 1.57 mio € for mergers and 137,000 € for divisions. 
58 About 1.74 mio € for mergers and about 170,000 € for divisions. The difference in costs can be 
explained by the different number of occurrences of the two types of events. 
 
EN 22   EN under the First Directive have been rem oved, the filing of the draft terms of 
merger/division with the register will stil l cause costs to companies in most Member 
States. Annex 4 shows that in ten out of the sixteen Member States that have answered 
the question, companies are charged a fee for the publication of draft terms of 
merger/division. In six of the sixteen Memb er States no fee is  charged. For those 
Member States that charge a fee the fee varies from 1 € (in Germany) to 289 € (in 
Greece). In average the fee is around 105 €. For the nine Member States with specific 
information on the size of th e fee the total costs are 0.44 mio €/year for mergers and 
0.04 mio €/year for divisions. On this basis it ca n be estimated that the total costs in the 
EU of filing draft terms are about 1.39 mio €/year for mergers and 0.09 mio €/year for 
divisions, or 1.48 mio €/year for me rgers and divisions taken together.59  
4.3.2. Documentation to be made available to shareholders ahead of the general 
meeting 
As mentioned above under section 4.2.3., at le ast one month before the general meeting 
which is to decide about the merger/divis ion, shareholders have to be given the 
possibility to inspect certain documents at the place of the registered office (the draft 
terms of merger/division, the reports a nd the statement referred to under points 4.2.1, 
4.2.2 and 4.2.3, and the annual accounts and annua l reports of the merging companies 
(respectively: the companies involved in the division) for the preceding three financial 
years) and to receive free copies of these documents at their request. 
This information requirement does not take into account the technological developments 
and today's business environment. Nowadays, share ownership in public limited-liability 
companies is increasingly dispersed, in pa rticular where companies are listed on a 
regulated market. The Impact Assessm ent that was drawn up, in 2006, for the 
Commission proposal for a Directive on cert ain rights of shareholders in listed 
companies60 showed that in 2004, on average, about  one third of shares in companies 
listed in the EU were held by non resident sh areholders and that the tendency during the 
last years has been towards a fast increase of cross-border ownership for EU listed companies.
61 It seems obvious that for foreign investors the possibility to consult 
documents at the place of the company's regist ered office is almost worthless. But also 
for non-listed companies that are likely to ha ve a more homogeneous ownership structure 
such on the spot consultation possibi lities no longer seem appropriate. 
This conclusion is supported by anecdotal evidence that copies of the annual reports, for 
example, are requested only by a minority of  shareholders. However, despite the low 
demand from the side of their shareholders, companies have to produce a considerable 
                                                 
59 The Member States on which no information is  available are: BG, FI, HU, LU, LV, NL, PL, PT, 
RO, SI and ES. It is assumed that in 62.5 % (=10 /16) of these Member St ates the average EU fee 
applies and that in the other Member States no fee applies. For FR, there is information that there 
is a fee of 3-4 € per line but no information on th e average number of lines. Therefore, the average 
EU fee of 105 € is also used as an estimate in FR.  
60 Directive 2007/36/EC, see footnote 21.  The impact assessment on this proposal can  be found on DG MARKT's website at 
http://ec.europa.eu/internal_market/company/shareholders/indexa_en.htm 
61 SEC(2006)181, pages 8 and 48, 
http://ec.europa.eu/internal_market/company/docs/shareholders/comm_native_sec_2006_0181_en.pdf 
 
EN 23   EN number of paper copies of th e three reports in advance in order to be able to meet 
possible requests without delaying the proce ss. In the case of cross-border mergers62 
copies may even have to be provided in different languages. 
In order to illustrate th e problem, the example set out in Annex 5 shows the 
documentation that was made available in th e context of a recent merger between two 
large insurance groups, on the basis of the curr ent rules of the Third Directive. The total 
costs for the printing of about 22,000 copies of the last three annual re ports and 14,800 
copies of the last qu arterly financial statements, the storing, mailing and, finally, the 
destruction of redundant copies amounted, in  that case, to ab out 800,000 €. Although this 
example is obviously not representative for th e average merger in the EU, it shows what 
consequences the current rules can have. 
The production of high numbers of copies that are, in the end, not requested by 
shareholders does not seem acceptable from an environmental point of view either. 
However, if a company does not want to risk delaying the process it is almost impossible 
not to produce the copies before requests from shareholders are actually received. 
As mentioned above under section 4.2.3, the c onsortium has measured only three of the 
information obligations in the Third and Si xth Directive where the inspection and making 
available of documents ahead of th e general meeting is relevant.  
As regards mergers,  the consortium estimates that the costs and burdens of making 
available to the shareholders the di fferent documents concerned amount to 
3.49 mio €/year in the EU63, only counting the number of occurrences of normal 
procedure mergers. On top of this come, therefore, the costs related to simplified 
mergers64 for which however, no figures are availa ble. The amount referred to above can 
therefore be considered as a minimum average amount. 
As regards divisions,  the consortium estimates that the costs and burdens of making 
available to the shareholders the di fferent documents concerned amount to 
0.24 mio €/year, only counting the number of occurrences of normal procedure divisions. 
On top of this come, therefore, total co sts of 0.51 mio €/year regarding simplified 
divisions in those 14 Member States65 where a general meeting only is required in the 
dividing company.66 This leads to a total of 0.75 mio €/year for divisions.  
One has to add to this, finally, the costs related to divisions where the recipient 
companies together hold all the shares of the company being divi ded and therefore only 
general meetings in the reci pient companies are required.67 On these costs no figures are 
available so that, again, the total amount refe rred to above can be regarded as a minimum 
average amount.  
                                                 
62 Through the reference, in Article 6(2) of Directive 2005/56/EC, to "additional requirements 
imposed by the Member State to which the compan y concerned is subject", the national rules on 
documentation requirements deriving from the provisions of the Third and the Sixth Directive for 
domestic mergers and divisions will normally apply also in the context of cross-border mergers. 
63 Data missing from DK. 
64 Those under Art. 8(b), 24, 25(b) and 27(b) Third Directive. 
65 These are: AT, CZ, FI, FR, EL, IE, IT, LT, LU, NL, SI, ES, SE and UK. 
66 Art. 6(b) Sixth Directive 
67 Art. 20(b) Sixth Directive 
 
EN 24   EN This means that the total administrative burdens for mergers/divisions in this context 
amount at least to 4.24 mio €/year. 
4.4. Protection of creditors 
Creditor protection rules in the Third and the Sixth Directives were created on the basis 
of the concept that had already been used, a few years earlier, for the Second Directive 
on the capital of public limited-liability companies. 
Directive 2006/68/EC modifying the Second Di rective modernised the creditor protection 
rule applicable in case of a reduction in capital68. The procedure for protecting creditors 
whose claim antedate the publication of the decision on the reduction was specified more 
in detail. It was also clarified that these cred itors have to show credibly that their claims 
are being jeopardised by the capital reduc tion if they want to obtain security. 
This change so far has not been reflected in  the parallel provisions in the Third and the 
Sixth Directives which does, at this stage, not seem to lead to problems in practice but 
creates an unnecessary incoherence in the rules of these three directives. 
5. S UBSIDIARITY  
Action at EU level is necessary to the extent that the oblig ations that impose 
administrative burdens derive from EU dir ectives. Under those c onditions, the reduction 
of administrative burden requires the modification of the EU rules. Action at EU level is 
therefore justified. 
6. O BJECTIVES  
The objective of the initiative is to enha nce the competitiveness of EU companies by 
reducing administrative burdens caused by the ru les of the Third and the Sixth Directives 
where this can be done wit hout jeopardising the interest s of other stakeholders. 
In particular, this initiative aims at: 
• Reducing reporting requirements at EU level in the context of me rgers and divisions, 
in order to provide Member States and co mpanies with more flexibility to decide 
which reports are really needed in each specific case; 
• Removing rules that lead to double reporting and, therefore cause unnecessary costs to 
companies; 
• Adapting rules on publication and inform ation duties to the technological 
developments, also with a view to ge neral environmental considerations; and 
• Ensuring coherence between the rules of th e Third and the Sixth Directives on one 
hand and recent changes to the rest of th e Company law acquis on the other hand, in 
                                                 
68 Article 32 Second Directive, as modified  by Art. 1(9) of Directive 2006/68/EC 
 
EN 25   EN particular as concerns the creditor protec tion rules in the Third, the Sixth and the 
Second Directive. 
7. P OLICY OPTIONS AND ANALYSIS  
This section examines different policy options  that could be chosen in order to reduce 
administrative burdens, i.e., the respectiv e merits of doing nothing, reducing the 
requirements in the directives and, possibl y, preventing Member States from imposing 
certain requirements on companies (full harm onisation). These options are discussed and 
measured against the following pre-defined criteria: 
(a) Reduction of companies' administrative burdens : Information obligations 
create internal and external co sts to the company (e.g. fees and 
remunerations for external experts etc). Where the companies would not 
incur the same costs without the in formation obligation these costs are 
administrative burdens. These burdens prevent companies from using their capital for purposes that are directly  related to their business and, 
therefore, reduce the competitiveness of these companies. 
(b) Impact on the rights of reside nt and non-resident shareholders
: The 
majority of rules in the Third and the Sixth Directives are designed to 
protect shareholders, and in par ticular minority shareholders. Any 
reduction in obligations for companies therefore needs to be weighed against the interest of the shareholders in obtaining this information. Where the question is at stake how to provide information (e.g. in paper or electronically, through the compa ny or through central bodies) in 
particular the accessibility for sharehol ders and possible access costs have 
to be taken into account. 
(c) Impact on creditors and other stakeholders (e.g. employees)
: Mergers and 
divisions have an impact also on stakeholders like creditors and 
employees. Any proposal for measures th erefore has to ta ke into account 
the possible impact on these parties. 
(d) Environmental impact:  Reporting and information requirements that rely 
on paper based solutions have a negative environmental impact and should therefore be replaced by electronic solutions where this is possible and 
appropriate. This approach is also in line with the Sustainable Development Strategy of the EU, by re ducing the use of resources at the 
production and by reducing waste.
69 
(e) Consistency with other directives : For the sake of clarity and legal 
certainty, the rules on domestic merger s and divisions should be in line 
with related rules, such as those on cross-border mergers, and take account 
of changes that have been made to these rules in the last years. 
                                                 
69 See e.g. Communication from the Commission to the Council and the European Parliament - 
Towards a Thematic Strategy on the Sustaina ble Use of Natural Resources (COM(2003)572 
final), available at: http://ec.europa.eu/environment/natres/index.htm  
 
EN 26   EN 7.1. Reporting requirements – measures ta rgeting all public limited-liability 
companies 
7.1.1. Option 1: No policy change Based on the estimations above, the average administrative burdens of the current 
situation where all three repo rts have to be provided to  shareholders lie at around 
255.04 mio €/year for mergers and 88.06 mio €/year for divisions.
70 These estimations do 
not take account yet of the modification in troduced by Directive 2007/63/EC with a view 
to the independent expert report as this directive has to be transposed only by 
31 December 2008. With a view to this modification, the consortium assumes that 66 % of all micro and small companies and 25 % of all larger companies will make use of the 
waiver introduced by Directive 2007/63/EC. On the basis of this assumption, the 
transposition of that modifi cation would lead to burden re ductions of 128.17 mio €/year 
for mergers and 41.92 mio €/year for divi sions, or 170.09 mio €/year in total.
71 The total 
yearly administrative burdens of the repor ting requirements should therefore be reduced 
to about 126.87 mio €/year in the context of mergers and 4 6.14 mio € in the context of 
divisions. 
Apart from situations covered by this new exemption, the production of the reports 
remains mandatory. Given that there are also no indications for deve lopments that would 
render this production less costly than is th e case today, option 1 would mean that, after 
31 December 2008, these costs would remain unchanged. 
7.1.2. Option 2: Introduce the possibility, fo r shareholders, to renounce the written 
report of the management and the accounting statement 
(1) Waiver by unanimity 
As just indicated, Directive 2007/63/EC modifi ed the Third and the Sixth Directives by 
aligning them with the rule in Directive 2005/56/EC on cross-border mergers which says that no expert report has to  be established where all sh areholders renounce it. Option 2 
would imply extending this rule to the written report of the management and the 
accounting statement. 
The modification, by Directive 2007/63/EC, re flects the Roman law principle "Volenti 
non fit iniuria" which means that there is no need to force protection on someone who 
does not consider this protection necessary. Extending this rule to the requirements for 
the written report by the management and the accounting statement seems only logical. It 
should also be noted that a bout half of the Member States that provided DG MARKT 
with information already apply this possibil ity of a waiver in th e case of mergers and 
divisions of private limited-liability companies. 
Creditors and other stakehol ders would not be affected by this change. The rules 
establishing the reporting requirements  are designed for the protection of the 
                                                
 
70 Total costs minus 25% "business as usual costs". 
71 According to the consortium 65% of all compan ies are micro or small companies and 35% are 
larger companies. The calculation is then e.g.  for mergers: 330,860,951*(65%*66%+35%*25%) = 
cost saving of 170,889,681. Subtracting 25% for business as usual costs gives burden reduction. 
 
EN 27   EN shareholders, not of the creditors (see point 4.4) or the employees  (the protection of 
employees is dealt with by separate EU acts72) who enjoy protection under different 
rules. Consequently, whereas the draft terms of merger/division are publicly available, the directives provide that the report of the management and the accounting statement 
only have to be accessible to the shareholders. 
With a view to the written report by the management , the administrative burden 
reduction of such a modification can be estimat ed to lie at 3.02 mio €/year for mergers 
and another 3.45 mio €/year for divisions , under the same assumption as above. 
With a view to the accounting statement , the administrative burden reduction is 
currently estimated at 0.54 mio €/year for me rgers and 0.12 mio €/year for divisions, on 
the basis of the same assumption (but  might be higher, cf. section 4.2.3). 
The total administrative burden savings under option 2 can ther efore be estimated to be 
7.12 mio €/year, that come on top of the 170.09 mio €/year arrived at under option 1. 
(2) Waiver by majority 
In its report, the consortium proposes to in troduce a waiver by majority decision of the 
shareholders represented at the general meeting. Despite the need to call a separate general meeting to decide on the waiver, the consortium estimates that this scenario 
could imply additional savings of 1.01 mio €/y ear compared to a decision by unanimity. 
However, the calculation does not seem to ta ke account of the costs that are caused 
where the general meeting is called but the majority is not reached.  
7.1.3. Option 3: Restrict reporting requirements  to larger or to listed companies 
(1) Restricting the reporting requirements to  medium-sized and large companies 
This option would imply an exemption, from the reporting requirement, for micro entities 
and small companies. Micro and small entities are defined as follows: 
 Micro Small Medium Large 
Net turnover (€) ≤ 1 000 000 ≤ 8 800 000 ≤ 35 000 000  > 35 000 000
Balance sheet total (€) ≤ 500 000 ≤ 4 400 000 ≤ 17 500 000  > 17 500 000
Number of employees ≤ 10 ≤ 50 ≤ 250 > 250
The consortium estimates the total potential of this proposal for reducing administrative 
burdens at about 166.56 mio €/year for me rgers and another 55.65 mio €/year with a 
view to divisions or 222.21 mi o €/year in total for merger s and divisions, i.e. 52.12 mio € 
above the 170.09 mio € arrived at under option 1. 
(2) Restricting the reporting require ments to listed companies 
                                                 
72 See footnote 19. 
 
EN 28   EN One possibility for reducing the current requir ements would be to limit the reporting 
obligations to listed companies. Such a limitation can be found in a number of EU rules dealing with transparency and informati on and reporting duties (e.g. Transparency 
Directive, Shareholders' rights Directive, Pros pectus Directive). Such a restriction could 
be justified with the fact that a company that  uses the stock exchange in order to raise 
funds from a broad public can also be made subject to stricter requirements than a non-
listed public limited liability company. 
According to information from the Federati on of European Stock Exchanges (FESE), the 
number of companies based in the EU that ha d shares listed at EU FESE members, in 
May 2008, was 8,488. These are 1.3% of the to tal number of public limited-liability 
companies in the EU which, on the basis of  the figures provided by the European 
Registries Forum
73, can be estimated at about 650,000. 
The potential cost reduction unde r this option, however, can be  estimated to lie below the 
99% that the above figures suggest. In the ca se of listed companies, the reporting can be 
expected to be more complicated and therefor e, on average, more expensive than in the 
case of unlisted ones. However, even if a re duction potential of only 80% of the total 
costs was assumed, this opti on could reduce the total administrativ e burden of these 
requirements by, on average, a further 101.5 mi o €/year with a view to mergers and 
36.9 mio €/year with a view to divisions, compared to option 1.74  
7.1.4. Option 4: Repeal the reporting re quirements in the directives 
Option 4 implies deleting the re porting requirements from the directives. This means that 
it would be left to Member States whether and which reporting ob ligations they impose 
on their companies. This option takes account of  the fact that, even where Member States 
decide to require certain reports, it is easier for them to define cases in which these reports are not needed (limited size of the companies involve d, and in particular of the 
company to be acquired, limited number of shareholders etc.), on the basis of the 
specifics of the country concerned, taking into account that the Third and the Sixth Directives deal with purely  domestic mergers/divisions. 
This option could reduce the burdens linked to  EU requirements in that area to zero and 
therefore lead to further bur den reductions of about 126.87 mi o €/year in the context of 
mergers and 46.14 mio €/year in the contex t of divisions, compared to option 1
75. 
However, due to the need to protect sharehol ders at least under certain circumstances it 
seems likely that at least some Member States would maintain certain reporting 
requirements at national level. 
7.1.5. Comparing the options 
Option 1 would not lead to any further re duction in administrative burden and would 
therefore not meet the obj ective set out under point 6. 
                                                 
73 See Annex 5. No figures were ava ilable for BE, BG, DE, GR, HU and SE. 
74 These figures are calculated on the basis of the figures calculated above under Option 1: No policy 
change. Merger: 126.87 mio*80%. Division: 46.14 mio*80%. 
75 The figures calculated refer to the calculation made under Option 1 above. 
 
EN 29   EN Under all other options, firstly  the requirement to set up an accounting statement should 
be abolished where the company has set up a half-yearly financial statement under the 
Transparency Directive. This is a change th at merely adapts the requirements of the 
Third and the Sixth Directives to take account of the Transparency Directive. 
For the rest, option 4 is likely to achieve the most substantial savings. However, as 
demonstrated under point 4.2, the reports fulfil a useful func tion in providing 
shareholders with the necessary informati on. Repealing them entirely could have as a 
consequence that shareholders in future will not dispose any more of the information they need in order to take an informed decision a bout the merger or the division. Furthermore, 
given the need for some information this measure is likely to create 27 regimes of information obligations with still another regi me – that of the Tenth Directive – applying 
to cross-border mergers. This can be pr oblematic in particular for non resident 
shareholders. This is the reason why out of the slight majority of stakeholders who 
supported a modification of the provisions of th e Third and the Sixth Directives in their 
reaction to the July 2007 Communication, one third made their support conditional upon 
the shareholders agreeing to waiving the report
76.  
The same argument applies, in principle, in the case of the second scenario of option 3. 
However, under this option there would be a harmonised system at least for listed 
companies, which are more likely to have an international shareholder base than non listed ones. The argument that on e can nevertheless put forward against this option is that 
in the case of listed companies the shareholde rs have at least one indication as to the 
value of that company (even if the share price obviously does not exactly mirror the 
company's value but can, in certain cases, be influenced by other f actors). Shareholders 
of unlisted companies do normally not have a comparable indication of the company's 
value which would help them to judge the ap propriateness of the share exchange ratio 
themselves. One can therefore argue that they need, in this respect, even more protection 
than holders of listed shares. 
The first scenario of option 3 takes this, at  least partially, into account. Furthermore, 
micro and small companies that are targeted in that scenario typically do not have a significant cross-border activity so that the impact on non-resident shareholders and the 
coherence with the rules for cross-border mergers play a minor role. However, the 
definition of these categories is based on crit eria that are not related to the number and 
the situation of the shareholde rs. Whereas the accounting dir ectives, from which the idea 
of such segmentation is taken, target all stakeholders, the reports in the Third and the Sixth Directive are specifically meant for the shareholders. Not taking their situation into account when defining an exemption in this context, therefore, seems questionable. 
Option 2, in its first alternative, avoids any negative impact on the interests of the 
shareholders while achieving some savi ngs for the companies involved. The second 
alternative would reduce the protection in pa rticular for those shareholders that are 
                                                
 
76 See DG MARKT's summary report (footnote 10). Only 40% out of the 129 total reactions to the 
communication took a position on the question with a view to the report by the management, and only one third of all respondents took a position with a view to the accounting statement. 
 
EN 30   EN prevented from voting in the general meet ing. Furthermore, as set out above the 
likelihood that substantial additional savings will be made seems doubtful. 
The differences between the options are summarised in the table below:77 
Figure 1: Comparison of options 
 Reduction of 
companies' 
admin burdens Impact on 
resident 
shareholders Impact on 
non resident 
shareholders Impact on 
other 
stakeholders 
(creditors, 
employees) Environ
mental 
impact Consistency 
with other 
directives* 
Option 1: No policy change + (170.09 mio 
€/year){ { { { { { 
Waiver by 
unanimity + (177.21 mio 
€/year) { { { { { Option 2: 
Possibility 
for 
shareholders 
to renounce 
to the 
management 
report and 
the 
accounting 
statement Waiver by 
majority 
decision + (up to 178.22 
mio €/year) { { { { { 
Exemption of 
micros and 
small 
companies + (222.2 mio 
€/year) - { { { { Option 3:  
Only listed 
companies ++ (308.49 mio 
€/year) - - - { { - 
Option 4: Repeal the reporting 
requirements in the directives ++ (up to 343.1 
mio €/year) - - - - { { - - 
* in particular with Cross-border mergers Directive 
"{": No change "+": Positive impact "-": Negative impact  
Option 2 is therefore the preferred option. 
                                                 
77 Note that the "no policy change" option forms a dynamic baseline as through the transposition of 
Directive 2007/63/EC the 170.09 mio €/year savings indicated will be made in future even 
without further action. The cost reductions for the other options are calculated by adding to these 170.09 mio €/year the additional expected savings. 
 
EN 31   EN 7.2. Reporting requirements – measures with  a view to companies that are set 
up or increase their capital in the context of a merger or division 
7.2.1. Option 1: No policy change This option implies that Member States, in the case of mergers or public offers, would 
continue to have the possibili ty to exempt companies from the requirement to have an 
independent expert report es tablished pursuant to the Sec ond Directive, but that they 
would not have such possibility in the context of divisions. 
The current costs of that obligati on would therefore remain unchanged. 
7.2.2. Option 2: Introduce a Member State op tion to grant an e xemption from the 
reporting requirement under the Second Di rective in the case of a division 
Under this option, an exemption would be intr oduced, with a view to divisions, for those 
cases where there otherwise would be double reporting, i.e. where the report under the 
Sixth Directive is effectively drawn up (and not waived as proposed above). The total 
costs and burdens of the repo rt under the Second Directive when linked to a division 
have been estimated above under secti on 4.2.4, to lie at between 13.5 and 19.5 mio €. 
This leads to a potential burden reduction of an exemption from this requirement of 
between 6.75 and 19.5 mio €/year, depending on wh ether only half the Member States or 
all of them make use of this option. 
On the basis of the assumption used above, th at 66% of all small companies and 25% of 
larger companies would waive the report under the Sixth Directive, the burden reduction 
potential of this measure can be estimat ed roughly to lie between 3.26 and 9.43 mio €. 
7.2.3. Option 3: Introduce a mandatory exemption from the reporting requirement 
under the Second Directive in the case of  a merger, a public offer and a division 
This option implies replacing the current Me mber States' option to exempt companies 
from the reporting requirement by a mandatory exemption in the case of a merger or a 
public offer, and to extend this mandato ry exemption to th e case of a division. 
This means that in all cases where an expert  report is established in the course of the 
setting up of new companies or of capital in creases that are linked to a merger, public 
offer or division, in future no expert report under the Second Directiv e would have to be 
established. According to the estimations set out above, this could lead to savings of 
more than 9.43 mio €/year. 
7.2.4. Comparing the options 
Option 1 would maintain the current inconsis tency of the different rules and therefore 
does not seem appropriate. 
Option 2 risks leading to less burden reduction as compared to  option 3, in case not all 
Member States make use of the possibilities offered by the EU rules. However, in their 
reactions to the 2007 Communi cation many of those stakeholders that opposed a full 
exemption argued that the two reports do not  serve the same purposes and that their 
 
EN 32   EN content could therefore differ, depending on the way a Member State has implemented 
the different directives. Also many of those that supported the pr oposal in principle 
expressed themselves in favour of leaving it to the Member States to decide what 
reporting requirements to impose in this context.78 
With a view to this possibility to "fin e tune" the different reports it seems more 
appropriate to choose option 2. 
Figure 2: Comparison of options 
 Reduction of 
companies' 
admin burdens Impact on 
shareholders Impact on other 
stakeholders 
(creditors, 
employees)  Environmental impact Consistency 
with other 
directives* 
Option 1: No policy change { { { { { 
Option 2: Introduce a 
Member State option in the 
case of a division + (between 3.26 
and 9.43 mio 
€/year)  { { { + 
Option 3: Introduce a 
mandatory exemption in the 
case of a merger, a public 
offer and a division ++ (more than 
9.43 mio €/year) { / - ** { { + 
* in particular with the rules on domestic mergers and on takeovers 
** depending on the way of transposition of the diff erent reporting requirements by the Member States 
"{": No change "+": Positive impact "-": Negative impact  
Option 2 is therefore the preferred option. 
7.3. Reporting requirements – measures concerning simplified mergers and 
divisions between parent companies and subsidiaries 
7.3.1. Option 1: No policy change The rules in the Third and the Sixth Directiv es on simplified mergers and divisions have 
been in place since these directives were fi rst adopted. It is therefore not likely that 
Member States will change their current syst ems without action at EU level. This means 
that, under this option, the current costs that are linked to the fact that a number of 
Member States have not made use of the possibilities offered by the directives will 
probably remain unchanged. 
7.3.2. Option 2: Removing the Member State options as regards simplified mergers 
and divisions 
This change would make it clearer that the EU supports simplified procedures for these 
kind of mergers, under the conditions provided fo r in the directives. The directives would 
                                                
 
78 One third of the total respondents took a position on this question, and 55% of them supported an 
exemption at least as a Member State option. 
 
EN 33   EN no longer empower Member States not to al low for the use of simplified procedures. 
However, given that the directives, in gene ral, only provide for minimum harmonisation, 
Member States would nonetheless still be fr ee to set stricter re quirements at national 
level and therefore, to maintain the curren t information obligations. For the same reason 
as in the case of option 1, it is not very likely that such a change of the directives would 
have a major impact at the level of the Member States.  
The same considerations apply where this option would be combin ed with a non-binding 
recommendation to Member States to allo w for simplified mergers: Member States 
would not be obliged to review the system they have been used to for a long time and 
would therefore not be ve ry likely to do so.  
7.3.3. Option 3: Ensuring that Member Stat es have to grant the possibility of 
simplified mergers/divisions 
Option 3 implies granting the exemptions that are currently provided for in the directives 
in the form of Member Stat es options (see point 4.2.5) to the companies covered by the 
directives and thus, preventing Member Stat es from requiring a general meeting and/or 
certain reports where the conditions for a simplified merger/division are fulfilled. 
Data from the consortium shows that in five of the Member States that made full use of 
the exemption possibilities for mergers (I taly, Lithuania, L uxembourg, Poland and 
Slovakia) these measures have led to total savings of about 24 mio €/year.79 Of these, the 
data indicates that about 90%  are due to the exemption from the reporting requirements 
that in the whole EU currentl y, in total, lead to costs of about 457.04 mio €/year (see 
above, point 7.1.1).  
According to the measurement report the number of Member States that have not  made 
use of the exemption possibilities concerning  the reporting requirements in case of 
merger is fourteen as regards the possibili ty of exemption where the acquiring company 
owns more than 90 % of the acquired compa ny and eleven as regards the possibility of 
exemption when the acquiring compa ny owns the acquired company by 100 %80. For the 
other exemption possibilities th e number of Member States th at have not made use hereof 
varies between eleven and fourteen.81  
Italy, Lithuania, Luxembourg, Poland and Slovakia account for 1,308 of the 11,432 draft 
terms of merger that are estimated  to occur per year in the EU.82 Member States that have 
                                                 
79 The exemption possibilities are the ones set out in Art. 24-29 Third Directive. 
80 Art. 28 and 24 Third Directive 
81 11 Member States have not made use of the possibility offered by Art. 25 not to require a general 
meeting in the acquiring company when there is 100 % ownership. 12 Member States have not made use of the possibility offered by Art. 27 not to require a general meeting in the acquiring 
company when there is more than  90 % ownership. Respectively 11 and 14 Member States have 
not made use of the possibilities offered by Art. 26 and 29 to include in the calculation of the "more than 90 %" or 100 % ownership persons holding shares in their own names but on behalf of 
the company, thereby extending the scope of the exemption possibilities in Art. 24, 25, 27 and 28. 
82 The measurement report's total figure of 20, 887 is corrected with a view to Denmark and 
Slovenia. The DK figure is corrected from 10,209 to 752 based on an estimate by the Danish 
 
EN 34   EN not transposed the exemption possibility concerning the re porting requirements where the 
acquiring company owns the acquired company by more than 90 % account for 7,989 of the draft terms of merger, whereas Member  States that have not transposed the 
exemption possibility concerning the re porting requirements where the acquiring 
company owns the acquired company by 100 % account for 3,917 of the draft terms of merger. Assuming that companies would make use of these two type s of exemptions to 
the same extent the figure s correspond roughly to a situ ation where 5,953 of the 11,432 
draft terms of merger in the EU occur in Memb er States that have not transposed any of 
the exemption possibilities concer ning the reporting requirements.  
Assuming that the (potential) cost savings per merger of using the exemptions are on 
average the same in the two groups of Member  States compared, and that the percentage 
of mergers potentially qualifyi ng as simplified mergers are on average also the same, a 
rough estimate of the potential cost savings of this option that would imply that all 
Member States provide for the merger  exemptions could be set at around 
109.23 mio €/year.
83 However, the data from the consortium indicates that, in the 
Member States that currently  do not make use of the s implified merger procedures 
involving exemptions from the reporting requireme nts, the costs of esta blishing an expert 
report are 85.3% higher than the average cost s of such reports in Italy, Lithuania, 
Luxembourg, Poland and Slovakia. Therefore the total cost savings of making the 
exemptions mandatory is more likely to  be around 188.43 mio €/year than 109.23 
mio €/year.84 Since cost savings from not having to draw up the management report and 
the expert report are estimated to include 25%  business as usual costs, the administrative 
burden reduction of this option can roughl y be estimated to around 147.21 mio €/year.85 
On top of this come potential savings re lated to the simplifie d division procedure.86 As 
this exemption possibility only regards the general meeting in the company being divided in cases where the recipient companies hold a ll the shares in the company being divided, 
the potential burden savings can be  expected to be much lower than for mergers. At this 
stage, there is incomplete information on the use of the exemption possibility for divisions. Assuming that the proportion of Me mber States that do not currently use the 
exemption possibility account for about the sa me proportion of divisi ons as was the case 
for mergers, and taking into account that divisions do not seem to occur as often as mergers and that the saving potential of not holding a general meeti ng is only around 10 
% compared to a situation where also reporting is not required, a rough estimate of the potential savings for the simp lified division procedure w ould lie around 6.28 mio €/year. 
87 
                                                                                                                                                 
Commerce and Companies Agency. Data from SI is missing but based on the data on "Disclosure 
of merger" the number of draft terms of merger have been set to 2 for SI. 
83 24 mio*(5,953/1,308) = 109.23 mio €.  
84 (85%*109.23)*1.853+(15%*109.23) = 188.43 
85 Data from the consortium indicat es that 87.5% of the costs from exempting from the simplified 
merger procedures originate fro m the two reports. Business as usual costs can therefore be 
estimated to lie around 41.22 mio €/year (188.43*87.5%*25%), and the total burden reduction can 
be estimated to lie around 147.21 mio €/year (188.43-41.22). 
86 Art. 20 Sixth Directive 
87 According to the information from the Member States presented in Annex 3 only 4 out of the 
14 Member States that have answered this question have made use of the exemption possibility. But since these 14 Member States only account for about 1/3 of the total number of draft terms of 
 
EN 35   EN This leads to a rough estimate of the total burden savings potential of around 
153.49 mio €/year for this option. The precise sa vings will depend on to what extent the 
ownership structure of companies in the Member States currently not using the 
exemptions allows for using the procedures. 
For the shareholders, no negative impact is  to be expected with a view to those 
exemptions that are granted under the condition that the "acquiring" company (in the case 
of a merger) or the recipient companies (in the case of a di vision) already own all of the 
shares of the company to be merged/divided  before the operation. Through the ownership 
in that latter company the "acquiring"/recipient companies were already before the merger/division economically carry ing the risk of their subsid iary. Consequently, it is not 
likely that there will be a real  impact of the merger on the value of the shares of these 
companies. 
In the case of a merger where the acquiring company holds 90% (or more)  of the shares 
of the company to be acquired, option 3 form ally leads to a reduc tion of some of the 
current measures protecting also the minority  shareholders (no need to hold a general 
meeting, reduced reporting requirements). However, the safeguards built in by the 
exemption rules of the direct ives (right of a minority that holds a 5% share in the 
company to request a general meeting, exemption from the requirement to provide the 
necessary reports to the shareholders of the company to be acquired only where these 
shareholders are granted a se ll out right) protect the rights of the minority in an 
appropriate way, considering in particular that this minority can never be large enough to 
block the merger in a general meeting. Theref ore, also in this scenario a significant 
negative impact on the (minority ) shareholders is not likely. 
Also for the creditors, option 3 would not im ply a significant negative impact. As already 
set out under point 7.1.2., the rules targeted by the exemptions are designed for the protection of the shareholders , not of the creditors that enjoy protection under different 
rules of the directives.  
Among the reactions to the 2007 communicati on, only 37 out of a total of 128 took a 
position on the proposal to repeal the requirement for a general meeting in these 
                                                                                                                                                
 
divisions it is uncertain how many of the total number of draft terms of division the Member 
States that have not used the exemption account for. According to the measurement report 20,887 
draft terms of merger and 4,327 draft terms of division occur in the EU per year. However, after correcting misleading figures from Denmark the figures are rather 11,432 and 1,852 respectively. 
Since there are always at least two existing co mpanies participating in a merger whereas for 
divisions in most cases only one existing company participate the ratio between mergers and divisions in the EU can roughly be set to around 3/1. This leads to a rough estimate of the 
potential savings of around 188.43/(10*3) = 6.28 mio €/year for the simplified division procedure. 
There are no "business as usual costs", so the figure is both the cost reduction and the administrative burden reduction.  
 
EN 36   EN situations. Out of these, about 58% s upported this proposal with a view to 
100% subsidiaries and about 55% wi th a view to 90% subsidiaries.88 
7.3.4. Comparing the options 
Option 1 is not likely to lead to any change in the costs for companies, compared to the 
current situation. Also under option 2, Member St ates would, in principl e, be free to keep 
their current rules. Only option 3, therefore, is likely to achieve a real reduction in costs 
and burdens compared to the current situation.  
Figure 3: Comparison of options 
 Reduction of 
companies' 
admin burdens Impact on 
shareholders' 
rights Impact on other 
stakeholders (e.g. 
creditors, 
employees) Environmen-
tal impact Consistency 
with other 
directives 
Option 1: No policy change { { { { { 
Option 2: exclude these cases 
from the directives { { { { { 
Option 3: Ensuring that 
Member States have to grant 
the possibility of simplified 
mergers/divisions + (153.49 mio 
€/year)  { { { { 
"{": No change "+": Positive impact "-": Negative impact  
Option 3 is therefore the preferred option. 
7.4. Publication and documentation duties 
This problem was not ra ised in the 2007 Communication but brought to the 
Commission's attention by respondents as an additional point that should be addressed. 
7.4.1. Option 1: No policy change 
As set out above under section 4.3.1., the co sts for publishing th e draft terms of 
merger/division would be reduced by about 1 mio €/year if the modification to the First 
Directive that was proposed on 17 April 200789 is adopted by the Council and the 
Parliament. 
Apart from these savings, the costs that co mpanies currently incur in order to make 
available the documentation to th eir shareholders at the regi stered office of the company 
and to provide them with copies wo uld remain unchanged under this option. 
                                                 
88 The supportive comments came in particular from many companies and companies' associations 
whereas in particular certain chambers of co mmerce were critical abou t the proposal and would 
prefer to keep the current flexibility for Member States on this issue. 
89 COM(2008)194 
 
EN 37   EN 7.4.2. Option 2: Use a central Internet site for publishing the information 
This option consists in providi ng that a central website should be used in order to publish 
the draft terms of mergers/division and the other documents to be made available to 
shareholders for a certain period. 
One possibility within this option is to use th e central electronic we bsite that has already 
been established in the context of the Transparency Directive90. However, this directive 
only applies to listed companies and, conseque ntly, in a number of Member States the 
central storage mechanism is run by the stock exchange. Therefore, for this option that 
would apply to all public limited-liability comp anies a separate website would have to be 
established which probably should be  run by the companies' register. 
With a view to the draft terms of merger/division  this option would not imply a major 
change compared to the current situation where these documents have to be entered into the company's file. In times of electronic company files the question where the document 
is stored electronically s hould have no major impact on th e costs created by the process 
(and charged to the company). 
With a view to the other documents to be made  available to the shareholders , the 
company's internal costs for compiling the in formation would remain the same as under 
option 1 whereas the costs for giving shareholde rs access to them at the registered office 
would be replaced by those for putting them on the central website which is likely to charge companies a fee for this service. It is difficult to estimate the difference between 
these two processes but in any case the difference can be expected to be minor, especially as the publication on the website might necessita te the creation of a protected zone where 
companies do not want to make these documen ts accessible to the wider public but only 
to their shareholders. 
Therefore, such a publication on  a central website would in fi rst place help to save the 
costs linked to the provision of paper copies to shareholders. The total costs and burdens 
of the documentation requirement have been esti mated to be at least 4.24 mio €/year (see 
point 4.3.2.). Looking at the example that has be en given it seems appropriate to assume 
that the larger part of  these costs is due to the producti on etc of paper copies. These latter 
costs and therefore the burden savings poten tial under this option can, therefore, be 
estimated to be at least around 3.5 mio €/year.  
From the users' point of view, an electronic availability of these other documents would 
even facilitate the access to the informa tion compared to the current situation, in 
particular for those shareholders who are not resident in the vicin ity of the company's 
registered office
91. Now, those shareholders normally n eed to ask the co mpany to provide 
them with copies of the documents and have to  wait for these copies to be sent to them.  
                                                 
90 Central Storage Mechanism, Art.  21(2) Transparency Directive. 
91 The Commission Communication "Preparing Europe's digital future – i2010 Mid-Term Review" 
of 17 April 2008 (COM(2008) 199 final) find that more than half of EU citizens nowadays use the 
Internet regularly (i.e. at least once a week), w ith 80% of the households that use the Internet 
regularly having migrated already to a broad band connection. 
 
EN 38   EN However, there is a risk that under this  option certain costs could be caused to 
shareholders. Firstly, the body running the ce ntral electronic plat form might charge 
access costs to users as it is the case, with so me registers, with a view to information 
contained in the company's file. Furthermore,  those shareholders who prefer to work on 
paper documents would have to print the doc uments that sometimes can reach sizeable 
volumes (in particular annual reports of some public limited-liability companies). 
Nevertheless, it will normally neither be necessary to print all documents nor to print them in their entirety. Instead, printing can be restricted to thos e documents and those 
parts of them that the shareholder is really interested in. This would limit printing costs 
and have, at the same time, a favourable effect on the environment. 
7.4.3. Option 3: Use the company's or anot her Internet site for publishing the 
information 
Option 3 implies giving companies the possibi lity to replace the current obligations by 
making the draft terms of merger /division available to the shareholders on the company's 
own website (or on any other website), provided that the central electronic platform 
which is used to notify the changes made to the register contains a link to that website. 
As for the other documents to be made available to the shareholders the option implies 
granting companies the right to make availa ble the documents on their Internet site 
instead of complying with the current obligations. 
A general obligation to maintain a website does not exist in EU company law so far.
92 
According to ESTAT, in 2007, 18 % of all businesses in the EU ran an extranet. This 
figure, however, includes also the smallest  unlimited liability companies that do not fall 
within the scope of the directives.93 Imposing the use of a webs ite in the context of the 
Third and the Sixth Directives would creat e new administrative burdens on those 
companies that so far do not have an Inte rnet site. This does not seem appropriate.  
Instead, companies, under this option, with a view to the draft terms of merger/division  
should be given the choice between the ex isting publication in the registers and 
publication on their ow n Internet site or any other site. 
Where companies do not run a website but would need to publish information on the 
registers' internet site, potential savings would be the same as under option 2. However, 
where the company has a website, additional savings would be possible since the costs 
arising at the register should be reduced as the register in  future only would have to 
publish the fact that draft terms of merger /division of the companies concerned are 
available, and establish the link with the website where th ese draft terms are published. 
With a view to the other documents to be made available to shareholders, additional 
savings, compared to option 2, ar e possible under this  option as no fees would have to be 
                                                 
92 The Shareholders' rights Directive that is to be transposed by summer 2009 introduced such an 
obligation only with a view to companies whos e shares are listed on a regulated market. 
93 As an example, in Germany 87% of all companies between 50 and 249 employees had a website 
in 2007 (source: Statistisches Bundesamt, Wirtschaft und Statistik 12/2007, p. 1203). Also this number includes both private and unlimited and limited-liability companies. 
 
EN 39   EN paid to the body running the central website. As in option 2, these potential savings can 
be estimated to be at least around 3.5 mio €/year. 
The burden savings potential under this option ca n therefore be estimat ed to lie above the 
3.5 mio €/year assumed in the case of option 2.  
From the users' point of view, as under op tion 2, the electronic availability of the 
information should rather facilitate the access to the information compared to the current 
situation. However, in the case where the company's own Internet site can be used there would be a guarantee that  access is for free whereas the re gister (or a central electronic 
platform) might charge a fee in case the info rmation has to be accessed via its website. 
7.4.4. Comparing the options 
In terms of coherence of Community legi slation, both, options 2 and 3, compared to 
option 1, have the advantage of adapting the information mechanisms under the Third 
and the Sixth Directives to those used in mo re recent directives. Both these options also 
offer advantages in terms of accessibility to the users, as shown above. However, in the 
case of option 3 the risk that shareholders will incu r additional costs for the access to the 
information is reduced, compared to option 2. 
In terms of administrative burdens, option 1 w ill leave the current burdens for companies 
untouched (apart from the savi ngs that should be achieved via the modification of the 
First Directive that is under way, see above ). Option 2 requires the setting up of a new 
infrastructure, the costs of which are likely to be passed on to the companies. Option 3 
offers a higher degree of flexibility and, theref ore, seems preferable with a view to the 
objective of reducing ad ministrative burdens.  
Figure 4: Comparison of options 
 Reduction of 
companies' admin 
burdens Accessibility to 
shareholders/users Access costs for 
shareholders/users Environmen-
tal impact Consistency 
with other 
directives 
Option 1: No policy change { { { { { 
Option 2: Central 
electronic platform + (3.5 mio €) + - - + + 
Option 3: Internet site 
with link + (> 3.5 mio €) + - + + 
"{": No change "+": Positive impact "-": Negative impact  
Option 3 is therefore the preferred option. 
 
EN 40   EN 7.5. Protection of creditors 
7.5.1. Option 1: No policy change Since the recent modification of the Second Directive that had to be transposed by 
15 April 2008, the creditor protec tion rules under that directive have been clarified in the 
sense that Member States need to provide for the possibility for creditors to obtain 
securities for their claims only if they can cr edibly show that an ope ration concerning the 
capital of the company jeopardises their right s. The Third and the Sixth Directives that 
contain similar rules are less clear concerni ng the burden of proof in this context. 
Under option 1, these rules would remain unchanged. This means that there would 
continue to be a difference between the word ing regarding the credit or protection regime 
under the Second Directive on one hand and the Third and the Sixth Directives on the other, with the risk that transposition of thes e different rules into national law will differ.  
7.5.2. Option 2: Adapt creditor protection rule s to the provision in the modernised 
Second Directive 
This option entails adapting the rules in the Third and the Sixth Directives in the revised 
provision on creditor protection in  the Second Directive, and in particular to clarify that 
securities have to be provided only where the creditor can show credibly that his claims 
are jeopardised. 
This solution was proposed in the 2007 Communication. 36 out of 128 respondents took 
a position on this proposal, and 70 % of these respondents supported it. 
7.5.3. Option 3: Repeal the creditor pr otection rules in the directives 
This option would entail deleting the current provisions on creditor protection from the 
directives. 
However, as shown above the reporting requir ements of the directives are exclusively 
directed at the protection of the shareholde rs. Repealing the provisions dealing with the 
companies' creditors would therefore imply l eaving it entirely to the Member States to 
decide whether and how they want to provide for the protection of creditors. 
7.5.4. Comparing the options 
Option 3 would remove creditor protection rules entirely from  the directives. This would 
constitute a profound change to the objectives of the two dir ectives. Furthermore, it is 
difficult to justify why the EU should protect  the shareholders of  merging and dividing 
companies but not take account of the intere sts of the creditors of these companies.  
The change proposed in option 2 does not entail a material change to the current 
provision but only a clarification of its content.  As option 1, also option 2 is therefore not 
likely to have a major impact on company’s costs and burdens. However, potential legal 
uncertainty as to the burden of proof would be removed. Furt hermore, this option ensures 
coherence between the different legal acts in the area of EU company law. 
 
EN 41   EN Figure 5: Comparison of options 
 Reduction of 
companies' admin 
burdens Impact on 
creditors Impact on other 
stakeholders (e.g.. 
employees) Consistency with other 
directives 
Option 1: No policy change { { { { 
Option 2: Adapt to the provision in 
the modernised Second Directive { { { + 
Option 3: Repeal the creditor 
protection rules { - { - 
"{": No change "+": Positive impact "-": Negative impact  
Option 2 is therefore the preferred option. 
7.6. Conclusion 
On the basis of the predefined criteria and the considerations set out in the previous 
sections, the recommended options can be summarised as follows: 
Figure 6: Summary 
 Reduction of 
companies' admin 
burdens Impact on 
shareholders Impact on other 
stakeholders (e.g. 
creditors, 
employees) Environmen-
tal impact Consistency 
with other 
directives 
Possibility for shareholders to renounce to the written report of the management 
and the accounting statement + (7.12 mio €/year)* { { { { 
Introduce a Member State option 
regarding the expert report under the 2nd 
Directive in case of a division + (3.26 – 9.43 mio. 
€/year) { { { + 
Ensuring that companies have the 
possibility of a simplified 
merger/division +  
(153.49 mio €/year) { { { { 
Allow for publication via Internet site, 
accessible via a link on a central 
electronic platform + (> 3.5 mio €/year) +/-** { + + 
Adapt creditor protection rules to 
modernised provisions in 2nd Directive { { { { + 
* Savings measured against the dy namic baseline "No policy change" 
** While accessibility is improved, shareholders ma y incur some (limited) costs under this option. 
"{": No change "+": Positive impact "-": Negative impact  
The overall savings of the recommended options  in terms of administrative burdens can 
be estimated, on the basis of the information available at this stage, at about 172 mio €/year. On the basis of the figures set out in Section 3 above, this means that the 
implementation of these measures would lead to a reduction in admi nistrative burdens by 
 
EN 42   EN about 9.15% as far as the area of company law is concerned and by about 1.23% if the 
total administrative burdens in the areas of company la w, accounting and auditing are 
taken as a basis.  
However, taking into account the methodology of  the measurement, and in particular the 
fact that the figures for 16 Me mber States have been arrive d at by way of extrapolation, 
these estimates obviously can only give a rough i ndication as to the size of the savings 
that will ultimately be made. Furthermore, as indicated in Section 4.1, a considerable 
number of Member States apply the same or similar rules to mergers and divisions where 
private limited-liability companies are i nvolved. Although these operations do not fall 
within the scope of the directives and ther efore, of this impact assessment, additional 
savings should arise in that area at Member  State level once the simplification measures 
proposed in this impact assessment are implemented.  
8. M ONITORING AND EVALUATION  
Five years after the transpositio n of the amendments, the effect  of the measures should be 
evaluated.  
This evaluation should look, in part icular at the following questions: 
• Whether and to what extent the overall costs of companies have been reduced in the 
context of mergers and divisions; 
• Whether the information provided to shareholde rs and other stakeholders in the course 
of the process is considered sufficient; and 
• Whether the recommended Member States ' option with a view  to the reporting 
requirement under the Second Company law Directive in the case of mergers and 
divisions provides useful results or wh ether a mandatory exemption should be 
considered. 
 
EN 43   EN ANNEX 1 
 EUROPEAN COMMISSION 
Internal Market and Services DG 
 
FREE MOVEMENT OF CAPITAL, COMPANY LAW AND CORPORATE GOVERNANCE  
SYNTHESIS OF THE REACTIONS RECEIVED TO THE 
COMMISSION COMMUNICATION ON A SIMPLIFIED BUSINESS 
ENVIRONMENT FOR COMPAN IES IN THE AREAS OF 
COMPANY LAW, ACCOUNTING A ND AUDITING (COM(2007)394) 
THE INTERNAL MARKET  AND SERVICES  
DIRECTORATE-GENERAL  
DECEMBER 2007 
 
EN 44   EN On 10 July 2007, the Commission adopted it s communication on a simplified business 
environment for companies in the areas of company law, accounting and auditing. In this communication, the Commission set out  its proposals for reducing administrative burdens and 
adapting the acquis in these areas to  the needs of today's businesses. 
On 22 November, the Competitiveness Council adopted Council conclusions
94 welcoming the 
Commission initiative and calli ng on the Commission to expedite consideration of responses 
to its communication and, where appropriate and pref erably before the end of 2008, bring 
forward proposals, based on impact assessments. The Legal Affairs Committee of the European Parliament is currently working on a report on the communication to be adopted 
early in 2008. 
In addition, 18 Member States' governments, the government of one EEA country and 110 
stakeholders reacted to the invitation, in the communication, to submit comments on the 
proposals in writing, by mid-October 2007. 
Number of responses by field
institutional investors
9%securities regulators
2%trade unions
2%
notaries
2%bus ines s  regis ters
1%others
9%
lawyers
2%
cooperatives
2%
financial 
intermediaries
3%
consultancies 
(commercial 
information)
4%accountants and 
auditors
27%
public authorities
18%companies
19%
 
These contributions from governme nts and stakeholders originated  from 23 countries in total, 
including 22 Member States. A number of c ontributions were also submitted by European 
bodies and associations. 
                                                 
94 Council document 15222/07 DRS 48 
 
EN 45   EN Simplification: Responses per country
051015202530
AustriaBelgium
Bulgaria
Czech Rep.
Denmark
Estonia
FinlandFrance
GermanyGreece
IrelandItaly
Latvia
Lithuania
NetherlandsNorway
PolandPortugal
Romania Slovakia
SpainSweden
United Kingdom
EU associationsNumber of responses
 
DG MARKT would like to thank the interested pa rties who sent in written opinions for their 
contributions. 
This report summarises the reactions that DG MARKT received to the communication and the 
main comments made. It does not provide detailed statistical data, but rath er seeks to present a 
qualitative assessment of the contributions recei ved. It also does not represent any indication 
as to what follow-up could be given, by the Commission, to the July communication. 
1. E XECUTIVE SUMMARY  
A clear majority of those that reacted to the proposal to repeal certain company law 
directives did not support it. The main  argument put forward was that these 
directives provide legal certa inty and that their repeal would rather cau se additional 
costs than lead to savings for companies. 
However, about three quarters of those who took a position on the question whether 
individual simplification measures shoul d be proposed supported the idea. They 
considered that the Company Law Directiv es are in some parts overly descriptive 
and restrict the flexibility of Member States and comp anies beyond what is really 
necessarily. There was, in particular, overwhelming support for the proposals to 
abolish the requirement to publish details c ontained in the register in the national 
gazette (First Company law Directive) and to oblige Member States authorities to 
accept certified translations prepared and accepted in another Member State 
(Eleventh Company law Directive). On the proposal to reduce, at EU level, the 
reporting requirements in the case of domes tic mergers and divisions, there was a 
slight majority supporting th is idea, with the exception of the proposal concerning 
the independent expert report which is opposed by a majority of respondents. The 
majority of respondents supported, however, also the idea to streamline the creditor 
protection rules in these cases with the recent modification of the Second Company 
law Directive and to reduce the requirements for mergers with 90% or wholly owned 
subsidiaries. 
 
EN 46   EN Concerning the proposals put forward in the communication in the areas of 
accounting and auditing there was clear s upport from respondents for the proposal to 
introduce a Member State option to exempt  micro-entities from the scope of the 
accounting directives. The proposal to extend the transition period to the status of 
SME to five years met some scepticism.  However, a period of three years was 
considered acceptable. A slight majority of respondents disagreed with the potential 
relief from publication requirement for small entities. Also  the idea to allow 
unlimited liability medium-sized companies to follow the rules for small companies 
met support whereas respondents were spli t over the proposal to take the same 
measure with a view to management-own ed companies. Finally, the proposals for 
more minor simplification measures for al l companies were supported in respect of 
audit exemptions under specific circumstances , a clarification of the IAS Regulation 
as well as the deletion of certa in disclosure requirements. 
2. G ENERAL REMARKS  
Respondents in general welcomed the initiative to  address the issue of administrative burdens 
for companies, and in particular small and medium-sized ones. A number of respondents, 
however, stressed that any simp lification should take full account of the advantages of 
harmonisation and that thorough impact assessment s should be established in order to support 
individual simplification proposals. 
In the area of company law, reactions to the proposals seemed to be influenced mainly by 
geographical origin and less by the sector the respondents belonged to. However, this was not 
the case for the proposals concerning acco unting and auditing where support came in 
particular from companies and,  in many instances, from inve stors and public authorities 
whereas the reactions from the side of th e accounting and auditing profession and from 
consultancies to these propos als were often critical. 
3. O PTION 1: PLACING THE FOCUS ON CROSS -BORDER PROBLEMS (SECTION 3.1.1  OF 
THE COMMUNICATION ) 
In the communication, reducing the acquis in EU company law to those le gal acts that aim at 
solving specific cross-border problems wa s proposed as one possible way forward in 
company law. Under this option, it was therefore suggested to repeal di rectives such as the 
Third, the Sixth, the Twelfth and – subject to the outcome of the ongoing outside study on the 
current capital maintenance system – the Second Company law Directive. 
About half of the respondents took a position on this option 1. Of those respondents, about 
one third expressed themselves in favour of  the proposal whereas two thirds opposed it. 
Those who supported the proposal pointed out in particular th at EU company law in its 
current form is too inflexible and hinders regulatory competition. A number of these respondents, however, preferred taking a by case- by-case approach: the directives should be 
judged one by one and article by article in order to establis h whether the provisions are 
relevant to the effective func tioning of the single market.  
This approach was reflected in the views expr essed on the different di rectives mentioned in 
the Commission communication: about a quarter  of those respondents who took a position on 
 
EN 47   EN the Third and the Sixth Directive were in favou r of repealing these di rectives whereas only 
one fifth considered that the S econd Directive should be repeal ed. However, about two fifths 
of the respondents either asked for a repeal of  the Twelfth Directive or indicated that they 
could accept such repeal. 
Those respondents that expressed themselves ag ainst option 1 stressed in particular the 
positive effects of harmonisation. In their view, th ere are instances when it is valid to impose 
minimum standards which apply only at the domes tic level, thus ensuring at least a partial 
level playing field throughout the EU. In particular , the repeal of enabli ng legislation is seen 
as counterproductive. Furthermore, they consider  that the reduction in legal certainty caused 
by the repeal of the directives will cause new costs to companies that will outweigh the savings. Additional costs will, in their view, also be created for the other stakeholders if they 
have to deal again with 27 diffe rent legal systems in the future. This is likely to have a 
harmful effect on the confidence, in particular , of non-resident shareholders and creditors. 
Some respondents who opposed option 1 also took th e view that the practical effect of such 
measures would be limited as Member States  will not necessarily make use of the new 
flexibility.  
With a view to the Third and the Sixth Company law Directives , opponents to the proposal 
of repealing the directives believe that the di rectives' transparency requirements create cross-
border benefits and stressed that  these directives form the basis for the Tenth Company law 
Directive on cross-border mergers. One respondent  also recalled that the harmonisation of the 
transmission of rights and oblig ations in the directives has advantages for companies (e.g. 
patents of the merging companies in all Member  States are automatically transferred to the 
acquiring or recipient company). Those that s upported a repeal of these directives often 
considered these directives as outdated, in part icular after the adoptio n of the Directive on 
cross-border mergers, or found the rules much too detailed and considered that they unduly 
restrict the flexibility of Member States and companies. 
On the Second Company law Directive , most respondents took the vi ew that the outcome of 
the outside study commissioned by the Commissi on in 2006 should be awaited before taking 
further action. On the substance, a number of respondents, howeve r, considered that the rules 
of the directive are overly restrictive, im pose excessive burdens on companies and do not 
achieve its objective to protect, in particular, the credito rs of the company. Today financial 
mechanisms are much more sophisticated than at  the time of the adoption of the directive. In 
order to increase the flexibi lity, one respondent proposed to introduce a Member States' 
option to allow for real non-par value shares. The large majority of those respondents who 
expressed a view on the Second Directive opposed  the proposal of rep ealing the directive, 
mainly for the reason that the provisions provide  for the necessary protection to investors and 
creditors, that the provisions on distributions  to shareholders are important in order to 
preserve company and shareholder value and beca use pre-emption rights are considered as an 
important mechanism to protect shareholder righ ts. The latter right wa s considered important 
even by many of those respondents who, in ge neral, favoured repea ling the directive. 
Most respondents considered th e possibility to esta blish single-member companies important. 
Those respondents that neverthe less supported a re peal of the Twelfth Company law 
Directive  mainly took this view because they c onsidered that today this principle is 
established in all Member States so that EU intervention is not necessary any more. At the 
same time, some of them regarded the form al requirements contai ned in the directive 
(registration requirement, obligation to take decisions in writing and to conclude written 
contracts between the company and the memb er) as unnecessarily  burdensome. Those 
 
EN 48   EN respondents that expressed themselves in favour  of maintaining the directive stressed the 
enabling character of the directive and the risk  that the national legal systems will diverge 
after its repeal which would be particular ly harmful for companies that have 100% 
subsidiaries in other Member States. 
4. O PTION 2: MORE PRINCIPLE -BASED , LESS DETAILED REGULATION (SECTION 3.1.2.  
AND ANNEX 2 TO THE COMMUNICATION ) 
The second option offered in the communication consisted in the proposal to simplify at least 
parts of the Third, the Sixth and probably also  the Second Company law Directives as these 
directives, in their current form, leave Member St ates little flexibility to adapt their respective 
national systems to the evolving needs of businesses and stakeholders in general. 
Just over half of the total replies took a position on this option. Almost three quarters of those 
who expressed a view were generally in fa vour of or, at least, could accept adopting 
individual simplification measures as a seco nd best option after re pealing some of the 
directives. Those who chose this option believe that there are provisions in the company law 
directives that are truly obsolete and have no re al effect and should be repealed or amended. 
Simplification measures however should be examined and justified on a case by case basis.  
Some respondents objected to the proposals under  option 2 not because they did not see the 
need to simplify EU company law but because they expressed the concern that individual 
simplification measures might render the legal texts and the procedures more complex and 
costly than this is currently the case. They comm ented that it is very hard to set up a common 
technical method for simplificatio n. Therefore if the repeal of  the directives does not gain 
sufficient support, they would prefer not  to amend the directives at all. 
4.1. Reporting requirements under the Third and the Sixth Company law Directives 
Not all respondents who generally support  option 2 commented on the individual 
simplification measures set out in the anne xes of the communication. Among those who did 
comment there is a slight majority in favour of  the detailed proposals to  amend or repeal the 
reporting requirements in the Directives, with the exception of the proposal concerning the 
independent expert report which is o pposed by a majority of respondents. 
Those respondents who are in favour of changing  the rules on the reporting requirements (the 
written report of the management on the draft te rms of a merger or a division, the independent 
expert report and the accounting st atement) consider that it woul d be better to leave it to the 
Member States to fit the respective informat ion obligations in their legal system. At 
Community level it would be sufficient and mo re appropriate to set out an obligation to 
provide for adequate, transparen t and objective information to shareholders covering not only 
the economic and legal justification for the op eration but also its fi nancial terms and the 
valuation of the share exchange. However, th e way by which such information is to be 
provided, in the view of these respondents, can  be left to the Member States to decide. 
Half of those respondents who expressed themse lves in favour of amending the rules on the 
reporting requirements are in favour of abo lishing the requirement of drawing up the 
respective reports or statements only where shareholders renounce to them. Most of these respondents suggest that th is decision would have to be taken by unanimity. 
 
EN 49   EN According to some respondents, the possibility of differentiating betwee n listed and unlisted 
companies regarding the reporting requirements coul d also be considered. While it is essential 
to keep the requirements to protect the shareh olders of listed companies, the by-laws of 
unlisted companies in their view may set out different requirements. 
A number of respondents who oppose changing th e legislation stress the importance of the 
written report of the management on the draft te rms of a merger or a division, the independent 
expert report and the accounting statement in ensuring the transparency  of the operation and 
in the protection of shareholders' interests. In their view, these reports provide important 
information for the shareholde rs and facilitate understanding of the motivations and the 
financial arrangements of th e merger or the division.  
Regarding more substantial ch anges, a significant number of respondents mention that 
shifting from ex-ante information to ex-post liab ility may be costly and lessens the efficiency 
of shareholder protection. In particular, the cr oss-border enforcement of claims for damages is 
difficult. Some point out that such a change would reduce the positive impacts of the provisions of the Transparency Directive and the Shareholders' rights Directive facilitating 
cross-border voting. 
Some respondents indicated that mergers or divisi ons are rare events in companies' lives and 
that therefore the related reports do not consti tute a relevant cost factor. Accordingly the 
proposed modifications would not result in si gnificant cost-savings for the company.  
4.1.1. Written report by the management in  case of a merger or a division 
Slightly more than half of those who expresse d a view on this question support the proposal to 
amend the requirement on the written report or to leave it to the Member States to decide if 
they require a report by the management expl aining the draft terms of the merger or the 
division and setting out thei r legal and economic grounds. 
Most respondents who are in favour of amending the provision believe th at the requirement of 
the written report of the management should rema in as it stands but shareholders should be 
given the right to renounce to it. Most respondents suggest that th is decision would have to be 
taken by unanimity. 
Some suggest that shareholders should also be given the right to waive the management report 
in the case of a cross-border merger (Directive 2005/56/EC). 
4.1.2. Independent expert report 
Almost three fifths of the respondents who addressed this question took a position against 
abolishing or substantially amending the require ment for an independent  expert report in a 
case of a merger or a division. Most of them referred to the recently adopted Directive 2007/63/EC amending the Third Comp any law Directive on mergers and the Sixth 
Company law Directive on divisions. This am endment grants an exemption under the 
requirement of the independent expert repo rt if all shareholde rs renounce to it.  
Most respondents argue that shar eholders have a legitimate interest to be informed about the 
reasons and effects of the merger or the division, including the va luation of the share 
exchange ratio. The report ensures transparency a nd is indispensable to enable shareholders to 
take a well-informed decision at the general meeting.  
 
EN 50   EN A few of those respondents who are in favour of  amending the requirement of an independent 
expert report consider th at the report may be a bolished if a clear point of reference exists for 
fixing the exchange ratio, as e.g. the stock price of list ed shares, similarly as this is provided 
for in Directive 2006/68/EC amending th e Second Company law Directive. 
4.1.3. Financial statement 
Slightly more than half of the respondents also  expressed themselves in favour of the proposal 
to amend the provisions on the accounting statemen t that has to be drawn up in the case of a 
merger or a division. These respondents who suppor ted the abolition of the statement consider 
the requirement for an accounting statement in all cases where annual reports are older than 
6 months excessive. They believe it could be le ft to market forces to decide if such a 
statement is necessary. Some suggest that dire ctors should be allowed to certify, in their 
written report, the amount of net assets and th e net result for the relevant period and possibly 
other items on and off the balance sheet that were decisive in the setting of the share exchange 
ratio.  
Several respondents consider keeping the require ment for a financial statement but allowing 
shareholders to renounce to it. The decision , in their view, would have to be taken 
unanimously. 
The respondents who oppose the proposal underline the statement's role in shareholder 
protection. They claim that it is an important  means for the sharehol ders to judge if the 
proposed exchange ratio  is appropriate.  
4.1.4. Double reporting requirement in the case of a division 
Relatively few respondents – less than one third - expressed a vi ew on the proposal to abolish 
a double reporting requirement in the Sixth Comp any law Directive. The Directive allows 
Member States only to provide that the report on consideration in kind (Second Directive) and 
the expert report on the draft terms of divisi on may be drawn up by the same expert. They 
cannot grant an exemption from the double reporting requirement. 
A minority of respondents opposed the modification of the provisions for the reason that the 
expert report under the Second Directive and a report on the draft terms of the division under 
the Sixth Directive have diffe rent objectives. In their view  the former requires objective 
measurement while the assessment of the share exchange ratio aims at ensuring that the 
exchange ratio is appropriate.  
The majority of respondents, however, supported  the proposal of gran ting an exemption to 
companies from one of the reporting requirements and underlined that even if the two reports 
do not serve the same purpose, measuring th e value of the contribution in kind is a 
precondition for the assessment of the share exch ange ratio. Therefore th e report on the draft 
terms of the division may be sufficient. Pr oducing only one report could bring about cost 
savings to the company. 
4.2. Protection of creditors under the Third and the Sixth Directives 
Two thirds of the respondents who expressed a vi ew on this question agree that the creditor 
protection rules in the Third and the Sixth Direct ives should be aligned with the provisions of 
the Second Directive as ame nded by Directive 2006/68/EC. 
 
EN 51   EN Those who support the proposal to require cr editors to credibly demonstrate to the 
administrative or judicial authority that, in the ev ent of a merger or a division, their interest is 
at stake, emphasise the importance of increas ed coherence of EU company law provisions. 
Some respondents in the minority suggest wai ting to see how the amendment of the Second 
Directive is applied in practice. One respondent  considers that the provisions in the Second 
Directive are stricter and give less leeway to Member States th an the rules of the Third and 
the Sixth Directives.  
4.3. Protection of shareholders of the acqui ring/recipient company in the Third and 
the Sixth Directives 
Less than one third of the respondents commente d on the proposal to give Member States the 
right to determine the conditions that have to  be fulfilled if the acquiring/recipient company 
does not wish to hold a general meeting to  decide upon the merger or the division. 
Two thirds of those who responded to the ques tion believe that the respective rules should 
remain subject to EU law. Many argue that hold ing a general meeting is essential to ensure 
shareholders' rights and to reasonably limit dir ectors' liability since the resulting company 
does not only take over asse ts but also liabilities. 
The minority in favour of the pr oposal consider that the genera l meeting should be discharged 
of duties that are parts of the day-to-day management of the company. It would reduce 
transaction costs for companies. 
However, a slight majority of the respondents who gave a reply to th e question agreed that 
some flexibility should exist at least in the case s of the transfer of th e assets of a wholly 
owned subsidiary and of the acquisition of a su bsidiary whose parent company already holds 
90 % of the shares. 
5. A DDITIONAL SIMPLIFICATION MEASURES IN COMPANY LAW (SECTION 3.2 AND 
ANNEX  3 TO THE COMMUNICATION ) 
Alongside with both options presented in the pa per for company law, a number of individual 
simplification measures were proposed, in orde r to reduce administrative burdens that are 
linked to certain directives whose usefulness as such wa s not put into question by the 
communication.  
5.1. National gazette 
In particular, it was prop osed with a view to the First Company law Directive  to abolish the 
requirement to publish information in the national gazettes that also has to be entered into the 
Member States' commercial registers, to the exte nt that the publication in the national gazette 
entails additional costs for the companies. 
This proposal was supported by an overwhelming majority of respondents. A number of them 
stressed, however, that in this case the electr onic register should provi de a daily transaction 
lists. Some respondents furthermore, took the view  that the requirement for publication in the 
national gazette should only be deleted from the directive. It should then be left to Member 
States to decide whether they want to impos e such an obligation at national level. The 
minority of respondents that opposed the proposal mainly put forward the arguments that the 
 
EN 52   EN current system functions well, th at the electronic registers are not  sufficiently developed yet to 
provide an equivalent service,  that costs caused to companies by this requirement are 
relatively minor or that they oppose individual simplification m easures in general (see above 
under point 4). 
5.2. Certified Translations 
The second proposal contained in this sec tion of the communication referred to the 
possibility, for Member States, to  request translations in the c ontext of the establishment of a 
branch under the Eleventh Company Law Directive . 
A very broad majority of respondents agreed wi th the proposal to oblig e Member States to 
accept certified translations to  the extent that they ar e accepted by the judicial or 
administrative authorities of the Member St ate where they were established. Those 
respondents stressed that Member States' la ws sometimes impose excessive requirements, 
such as for notarisation. However, many respondents emphasised the importance of guaranteeing that the translation is reliable whic h would be the case if it is certified in a way 
accepted by the other Member States' authoritie s. The few respondents that objected to the 
proposal referred for example to the differences  in certification procedures in the Member 
States or opposed individual simplification m easures in general (see above under point 4). 
5.3. Registered office of a European Company 
A clear majority of respondents also supporte d the proposal to adapt Article 7 of the Statute 
for a European Company (SE)  concerning the company's registered office to the 
"Überseering" jurisprudence of the European C ourt of Justice. These respondents considered 
that the change would give European Compan ies more flexibility in structuring their 
operations. Some respondents drew the attention to the fact that  a practical interest of the 
company in having its registered office in anot her Member State than the administration can 
in particular exist where the administrati ons of different companies of one group are 
concentrated in one place in order to redu ce the administrative expenses. Those respondents 
that opposed the proposal put forward in partic ular that the current rule provides more 
transparency and that the "Überseering" judgm ent only applies direc tly to companies under 
national law, or considered the proposal not to be a priority, in view of the limited number of 
SEs up to date. 
6. A
CCOUNTING AND AUDITING (SECTION 4 AND ANNEX 4 TO THE COMMUNICATION ) 
In the areas of accounting and auditing, five diffe rent measures had been identified in the 
communication that aim at reducing the admi nistrative burdens, notably for small and 
medium-sized entities, while maintaining the goal to keep and improve accounting and auditing quality in the EU. 
Each single measure is summarised in identic al order as it appeared in the Commission 
Communication with no prejudgement  whether or not and how to pursue these in the future. 
6.1. Introduction of "Micro entities" 
The Commission proposed to introduce a new cat egory of so called micro entities in the 
Fourth Directive, which could be optionally exempted by Memb er States from the accounting 
directives. Micro entities are tent atively defined as entities with: 
 
EN 53   EN – less than ten employees,  
– balance sheet total below 500,000 EUR, and 
– turnover below 1,000,000 EUR.  
The proposal to introduce the micro entities  definition into the Fourth Directive was 
welcomed by a majority of t hose respondents that commented on the issue (abou t 80% of the 
total number of responden ts). Nine respondents st ated that the tentativ e figures defining the 
thresholds for micro-entities should be hi gher, seven wished them to be lower. 
Those respondents that welcomed the propos al considered it a major reduction of 
administrative burden for those entities, which will encourage new start-ups through removal of disincentives to incorpor ation. Support was the strongest amongst public authorities and 
companies where more than four fifths expressed themselves in favour of the proposal. There were also comments suggesting that the threshol ds for the micro entities should be as high as 
currently defined by Article 11 of the Fourth Directive for small companies. Those that 
opposed the proposal, primarily accountants and auditors, took the view  that, despite the 
possibility of Member States to maintain equiva lent requirements at their level, it would lead 
to an abolition of bookkeeping and preparation of  accounting data in gene ral for those entities. 
6.2. Trespassing the thresholds for SMEs 
Under this topic three is sues were discussed: 
– to prolong the two-year period in Article 12 of the Fourth Directive to five years; 
– to implement a one year period for those enti ties ceasing to exceed the thresholds instead 
of the existing two years period (Article 12); and 
– to change the general procedure on how  to amend and update the thresholds. 
Around 60% of respondents commented on the first issue and about 40% on the second one. 
Amongst these respondents, a slight majority were against the proposed changes; however, 
replies coming from companies were almost una nimously in favour. A major concern of the 
opponents was that an exceptionally bad year in terms of financial thresholds of Article 11 
could result in a 5 year switch to the small companies' accounting regime (as a consequence of combining the two proposed changes). In their vi ew, this effect was likely to lead to abuse. 
However, more than one fifth of these oppone nts would agree if the prolongation was limited 
to a period of 3 years. Some also suggested th at it should be made a Member States' option. 
Only 30% of the responses took a view on th e last question concerning the change of 
procedure to amend and update the thresholds. Ho wever, almost four fifths of these were 
rather positive, expressing a broad agreement that  the current process needs to be streamlined. 
Supporters were in favour of periodic updates with  some kind of reference or indexation, e.g. 
according to the percentage of inflation rate.  
Opponents argued that the threshold criteria are politically important and therefore should not 
be decided purely on technical grounds.  
 
EN 54   EN 6.3. Relief from publication requi rement for small entities 
Around three quarters of all respondents commented  on the issue with a majority expressing 
themselves against the proposed change. The st rongest support for the proposal was expressed 
by companies with three quarters of them pl eading in favour. The most vocal opponents were 
information providers (consultanc ies) who use the financial data in order to feed their 
databases. 
Supporters of the proposal stresse d that in the present situation mainly the competitors of 
small businesses benefit from the availability  of information. Opponents took the view that 
publication is not expensive, especially taking into account electronic possibilities such as 
XBRL. They also highlighted that the proposal w ould lead to a decrease in transparency and 
reliability with potential counterproductive result s like the increase in credit costs. It was also 
stressed that the publication re quirement is seen as a consequence of the limited liability 
status which requires that some information is pr ovided to the stakeholders  of the companies.  
6.4. Extension of exemption for companie s without particular external user 
6.4.1. Management owned companies Little more than half of respondents provi ded comments on the proposal to allow medium-
size companies whose managers are at the same time their owners to follow the same regime 
as the one applying to small companies. Thei r views were split evenly. However, among the 
companies, a majority of four fifths supported the proposal. 
Opponents to the issue stressed the interests of  stakeholders and the overall importance to 
maintain medium-sized enterprises transparent. Th e risk based approach was also criticised as 
being vague and creating a new, unnecessary ca tegory of companies. Technical problems of 
enforcement were raised as well,  pointing out for example to the lack of ownership databases.  
6.4.2. Unlimited liability medium companies 
Almost half of respondents commented on th e proposal to render the regime for small 
companies also applicable to unlimited liabili ty medium-sized companies, and about two 
thirds of these expressed themselves in favour . The strongest support came from companies 
that were almost unanimous in thei r positive assessment of the proposal. 
Some of the supporters even suggested extendin g the scope of the exem ption to all unlimited 
liability companies instead of restrict ing it to medium-sized companies.  
Opponents stressed the information needs of stakeholders. 
6.5. Simplification for all companies 
6.5.1. Full use of Article 57 – audit exem ptions under specific circumstances 
Almost half of the respondents took a position on this proposal. A large ma jority of two thirds 
were fully or rather supportive. Respondents fr om Member States which have made use of 
Article 57 generally provided a positive feed back. Respondents mainly supported the sole exemption of statutory audit, even though concer ns were put forward concerning the risk of 
further concentration of the audit market into th e hands of big players. Some put forward that 
given existing consolidation aud it techniques, the benefits of the proposed measures might not 
 
EN 55   EN live up to the expectations. Some supported consistency of auditing practice with 
consolidation requirements (IF RS). A number of respondent s urged the Commission to 
investigate why only a few Member States have  so far implemented the options in extant 
Article 57 in their jurisdiction, and call for further impact assessment. 
6.5.2. Clarification of the relationship be tween the IAS regulation and the Seventh 
Directive 
About 40% of respondents commented on the propos al to clarify the relationship between the 
IAS regulation and the Seventh Directive, and in particular that parent companies with 
immaterial subsidiaries do not n eed to prepare IFRS consolidat ed financial statements. These 
respondents were strongly in favour with companies being unanimously positive. 
Supporters encouraged also furt her clarifications of  the IAS Regulation, e.g. whether listed 
companies that do not form a group should follow IFRS, and addressed more detailed 
questions on the interlinkage  between the IAS regulation a nd national accounting regimes. 
6.5.3. Consolidation requirement for personal holdings 
Less than one fifth of respondents elaborate on th is issue, with a majority of these being in 
favour. 
6.5.4. Abolition of deferred tax accounting 
This issue attracted the attention of about 40% of the res pondents, with a clear majority of 
them being in favour; all companies supported the proposal.  
Some commented that it is unclear whether the pr oposal is referring just to SMEs (as stated in 
the last sentence of the respec tive paragraph of the Communicati on) or to all companies as 
referred to in the title. Therefor e those, who read it as restricted  to SMEs, advocated for relief 
to be granted to all companies for their sepa rate and consolidated accounts. Others would 
prefer this becoming a Member State option.  
Opponents claimed that deferred ta xes contain useful information and stressed that in any case 
there is already an option for Member States to allow for abridged notes without deferred tax 
disclosures for small companies. Others suggested differentiating this measure in the way that 
there should be a mandatory abolition for sm all companies, but a requirement for full 
consideration (accounts and disclosures) for medium-si zed and large companies.  
6.5.5. Formation expenses 
The proposal to repeal th e requirement for disclosu re of an explanation of formation expenses 
attracted attention of about 40% of the respond ents, out of whom an overwhelming majority 
showed to be in favour. The strongest suppo rt comes from companies and from public 
authorities. 
Proponents favoured an even strong er reduction of disclosure dut ies, such as the repeal of 
statements about auditors' fees, statements a bout derivative financia l instruments (both for 
medium-sized companies) and statements regardi ng financial instruments stated at fair value 
(for small companies only). 
 
EN 56   EN Opponents argue that information about formati on expenses is valuable. Some pointed out 
that exemption possibilities exist already fo r small companies (at Member State level). 
6.5.6. Breakdown of net turnover into catego ries of activity and geographical markets 
This issue was addressed by more than 40% of  the respondents. Around three quarters were in 
favour, including almost all companies. 
The arguments put forward corresponded to thos e set out with a view  to the formation 
expenses (see point 6.5.5), with the reservati on that large companies should continue to 
disclose. 
7. A DDITIONAL SUGGESTIONS  
7.1. Company law 
In the Commission communication, it was emphasi sed that the list of measures proposed 
therein was not considered to  be exhaustive, and the Commi ssion invited stakeholders to 
submit additional suggestions for possible simplif ication measures. This invitation was seized 
by some of the respondents. 
One respondent proposed to distinguish, in comp any law, better between listed and non listed 
companies, as this is the case already for the EU securities markets le gislation: for non-listed 
company the rules could be much less detailed  and more principle based and a bottom-up 
approach (”think small first”) should appl y. For listed companies, more complex 
circumstances would have to be addressed so th at for these companies the rules could have a 
grater level of detail. 
With a view to the Third and the Sixth Dire ctive, two respondents proposed to remove the 
current requirement to make available the last th ree annual reports at the registered office of 
the companies involved. At least for the two re ports on the previous fi nancial years it should 
be sufficient to make them available online, via the company’s website. 
Concerning the Eleventh Directiv e, some respondents took the view that the current situation 
where it is only ensured that the information is  available at the moment of the registration of 
the branch is not satisfactory. Although the di rective contains rules to have changes 
concerning the mother company filed at the bran ch's register this is not enforceable in 
practice. Also, the register of  the parent company should be informed about changes in the 
branch register. In this contex t and also from a number of ot her respondents there was a call 
on the Commission to increase its support for the BRITE project, in order to make sure that 
information can be exchanged via th e European Business Register (EBR). 
Another proposal that was made was to look not  only at the Company law Directives but also 
at the Capital markets Directives.95 Finally, one respondent s uggested proposing a single 
simplification directive in case option 1 would not obtain sufficient support. 
                                                 
95 Here, it should be noted that the ongoing exercise to measure administrative burdens also extends to 
certain Financial Services and Capital Markets Directives. Results of this measurement will be available 
in the course of 2008. 
 
EN 57   EN 7.2. Accounting  
In addition to responding on questions, comme ntators presented the following additional 
suggestions on the accounting side of the Commission Communication: 
Many respondents perceived the need to prepare different statements for different users (tax, 
statistics, etc.) as a major burden, and theref ore encourage general work on 'all purpose' 
financial statements accompanied by single filing. 
In terms of disclosure  it was suggested that Commission should exert pressure on Member 
Sates to utilise already existing exem ption options in accounting directives. 
Some respondents commented on the current IASB  draft "IFRS for SMEs" by stating that it is 
too complex and not focussing enough on the partic ular user needs and thus not suitable for 
SMEs. 
A call to reduce the number of options availabl e in the directives was also issued. Other 
respondents, however, highlighted th e need to keep options available to Member States so as 
to accommodate accounting requirements to na tional setting (especially where threshold 
values are concerned). 
* * 
 * 
 
EN 58   EN ANNEX 2 
National rules applying to mergers/d ivision of private limited-liability 
companies 
 
EN 59   EN COUNTRYApplication of the 
same rules for private and public companiesNeed for 
merger/division planNeed for general 
meetingNeed for written report by 
managementNeed for independent expert's 
reportNeed for separate 
accounting statement
Austria Basically yes, with some 
specific provisionsyes no, the shareholders 
may also cast their vote by circular resolutionyes yes yes, if last regular 
statement is older than six months
Belgium yes
Bulgaria
Cyprus very simplified yes yes yes no no
Czech Rep yes (references), but 
simplifiedyes no, but signature of 
associates or partnersyes yes yes
Denmark yes
Estonia Basically yes, with 
specific provisionsyes, no waiver Merger Yes, unless 
90% of share capital 
hold by acquiring company and not demanded by 5%Division Yes, no 
waiverMerger Yes, unless all shares hold by 
acquiring company or agreed by all 
shareholders - applicable only if net turnover does not exceed certain thresholdsDivision Yes, unless exchange of shares 
with divided company or approval of all 
shareholdersYes (by auditor), unless all shares held by 
acquiring company (merger) / exchange 
of shares with divided company (division) or agreed by all shareholdersyes
Finland basically yes yes yes yes yes, unless subsidiary merger or waived 
unanimously by shareholdersnoMergers / divisions involving private limited-liability companies
 
 
EN 60   EN France
Germany Basically yes, with 
specific provisionsyes yes Yes, unless all shares held by acquiring 
company or waived by all shareholdersYes, unless all shares hold by acquiring 
company or waived by all shareholdersno
Greece
Hungary no yes, but contents 
differ from 3rd/6th CLD, merely basic 
informationYes no no statement of assets and 
liabilities
Ireland no, no possibility for 
private companies to merge so far
but provided for in 
Reform Bill(yes) (yes)
Italy
Latvia yes
Lithuania basically yes yes yes no, unless requested by the shareholders 
who hold at lest 10% of all voting shares exept in case of merger by acquisition, when the acquiring 
company holds at least 90% of the 
shares of the acquired companyyes (firm of auditors), except in case of 
merger by acquisition, when the acquiring company holds at least 90% of the shares of the acquired companylike public limited
Luxembourg yes yes yes yes yes yes
Malta yes N.A. could be waived 
under conditions in 
Companies Act, 
Articles 345(6), 358(3), 359(1) (merger), Article 
362(6) (division)yes, but not for acquiring company 
holding at least 90% but not all of the 
shares, Article 359(2) Companies Actyes, but not for acquiring company 
holding at least 90% but not all of the 
shares, Article 359(2) Companies Act; 
and not for divisions in the cases described by Articles 374(5), 374A(4) Companies ActN.A.
 
 
EN 61   EN Netherlands yes N.A. N.A. N.A. N.A. N.A.
Norway Basically yes yes yes yes reports explaining share exchange ratio, 
not necessarily expert's report, acquiring company's report must be confirmed by auditor, thoughno
Poland
Portugal yes yes yes yes yes no
Romania
Slovakia Yes, unless other 
stipulation
[less detailed rules for 
cooperatives, partnerships]Yes yes Not, if all members renounce, § 152a(5) 
CCNo, auditor examination only if some of 
the members apply for it, § 152a(6) CCno
Slovenia yes
Spain Basically yes yes yes yes no yes
Sweden yes
UK No - rules apply (part 28 
of Companies Act 2006) in the case of private companies yes yes yes yes unless all shareholders agree that one 
is not necessary.yes
 
 
EN 62   EN COUNTRYPossibility to renounce to 
documents referred to aboveProvision of 
documents in 
electronic formDifferent procedures for mergers/divisions Statistics on number of 
mergers/division
Austria not for separate accounting 
statement;
management report and examination of share exchange ratio if declared 
by all shareholders in writing or in 
the general meetinglaw requires reports in 
writing, but, however, 
provision via electronic is not 
prohibitedprocedures identical in 2006:
appr. 1,000 mergers (only 
privates)appr. 100 divisions (both publics 
and privates)
Belgium no no,
but in preparationnot available
Bulgaria
Cyprus yes. The merger cannot proceed if so 
decided by majorityno not available
Czech Rep yes, unanimity no specification, 
therefore allowedCommercial Code
Sec 92a Mergers of Partnerships
Sec 92b Merger of Partnership with Ltd. PartnershipSec 104a Mergers of Ltd Partnerships
Sec 104b Mergers of Ltd. Partnerships with Partnershipnot available
Denmark Like public limited yes, e-mail is allowed procedures identical appr. 800 mergers / 500-600 
divisions (companies in general)
Estonia (cf. C-G) mergers /divisions:
2005: 101 / 10
2006: 176 / 40
2007: 186 / 79
Finland only export report, (cf. F) yes Procedures id entical, only differen ces in information 
contained in merger/division plan2007: 1288 mergers,
200-300 registered divisions
(public and private companies)
FranceMergers / divisions involving pr ivate limited-lia bility companies
 
 
EN 63   EN Germany yes in regard of written reports, 
unanimityNo (not required) procedures identical 2004/05: 1093
Greece
Hungary no allowed, not required - not available
Ireland yes, approval of shareholders Allowed Secs 201-204 Companies Act 1963
binding arrangements between company and members/creditors for the purpose of 
reconstruction/amalgamation of companies,
provision by a court to facilitate transfer of property in this 
regard,
possibility of squeeze-out (beneficial ownerships) of 
dissentin g shareholdersno recourse to 3rd CLD in case of 
merger of public companies so far
Italy
Latvia Yes, unanimity Allowed, electronic 
document without 
legal power
Lithuania no No provisions Procedures identical (Art. 61 sqq. Law on Companies) 2007:
mergers: 195 privates, 11 publics,
divisions: 7 privates, 1 public
Luxembour
gnot provided for no provision identical procedure not available
Malta (cf. D-F);
in addition, for divisions director's 
and expert's report and accounting 
statement can be waived 
unanimously, Article 366 Com
panies Actallowed, not required procedures are very similar
for mergers: Part VIII of the Companies Act (Articles 336-
359),
for divisions: Part IX of the Companies Act (Articles 360-
375)2006
42 companies involved in merger,
2 companies divides
Netherlands N.A. allowed, not required N.A.
Norway Allowed if accepted by 
shareholders2007: 4200 mergers (60 public), 
1765 divisions (15 public) 
 
EN 64   EN Poland
Portugal yes, unanimity no provision procedures identical in 2007: 21 mergers / 24 divisions
Romania
Slovakia Like public limited
Slovenia yes, unanimity not required procedures identical in 2005: 20 mergers
in 2006: 21 mergers
Spain no allowed, not required procedures identical
Sweden no allowed procedures identical 2000 mergers/year,
9 mergers between listed 
companies;divisions rare
UK yes for the independent experts 
report if all shareholders agree on 
that it is not necessarynot specified Takeover Provisions in Part 28 of Companies Act 2006 
supported by the Takeover Panel/code - is the normal 
route for domestic mergers and divisions in the UKs. 427a of Companies Act 1985 
(public companies)
Part 27 of the Companies Act 
2006
 
 
EN 65   EN ANNEX 3 
Simplified mergers and divisions 
 
EN 66   EN 1. P OSSIBILITIES FOR SIMPLIFIED MERGERS AND DIVISIONS UNDER THE THIRD AND 
THE SIXTH COMPANY LAW DIRECTIVES  
1.1. Simplified mergers 
The Third Directive allows for different forms of simplified mergers: 
– Member States can provide that , under certain conditions, the acquiring company  does 
not need to hold a general meeting96.  
– Member States can, furthermore, provide that, under certain conditions, none of the 
companies has to hold a general meeting  to approve the draft terms of merger where the 
acquiring company already holds all (voting)  shares  of the acquired company.97 In this 
case, also no written report by the management  of the companies and no independent 
expert reports  have to be established.98  
– Where the acquiring company does not hold all shares but holds at least 90%  and the 
minority shareholders of the company to be acquired are granted a sell out right  for their 
shares, Member States can not only relieve th e merging companies from the requirement of 
the written report by the management and the in dependent expert report s but also from the 
obligation to give shareholde rs the right to inspect cert ain documents, including an 
accounting statement , one month before the general meeting deciding on the merger.99 
1.2. Simplified divisions 
Also the Sixth Directive allows for three forms of simplified divisions: 
– Member States can provide that, under certain conditions, the recipient companies  do not 
need to hold a general meeting100;  
– Where all (voting) shares in the company to be divided are owned by the recipient 
companies, Member States can also provide th at there is no need to  hold a general meeting 
for the company to be divided , subject to certain conditions;101 and 
– Where the recipients companies are newly esta blished ones and their shares are attributed 
to the shareholders of the company to be divided in proportion to their rights in the 
company to be divided, no independent expert's  report under the Sixth Directive has to be 
established102. 
                                                 
96 Art. 8 Third Directive 
97 Art. 25 Third Directive 
98 Art. 24 Third Directive 
99 Art. 28 Third Directive 
100 Art. 6 Sixth Directive 
101 Art. 20 Sixth Directive 
102 Art. 22(5) Sixth Directive 
 
EN 67   EN 2. U SE OF THE OPTIONS BY THE MEMBER STATES  
Article 8 Third Directive Article 24 Third Directive Article 25 Third Directive Article 26 Third Directive 
Austria Yes not transposed * No Article transposed
BelgiumNo Article transposed No Article transposed
Bulgarianot transposed not transposed not transposed
CyprusNot applicable Article transposed Not applicable not transposed
Czech Republic (Act No. 125/2008 Coll., on transformation of business companies and cooperatives (as of 1 July 2008) 
§129: where the shares of the acquiring company's existing shareholders are not exchanged, the decision 
on a merger by acquisition may be taken by the acquiring company's board instead of its GM provided 
that: a) SH shall be informed about their rights at least one month before the resolution on the draft terms of merger;b) at least 1 month before the decision on the draft terms of merger all SH of the participating company must have access to the documents listed in Art. 11 Third Directive and must be entitled to receive, 
without any undue delay, copies or abstracts (§ 119); 
c) one or more SH of the acquiring company holding at least 5% of shares can demand a GM within 1 month after publication. If the company has issued shares with no voting rights attached, such shares are not taken into account for the calculation (§131(1));d) the acquiring company owns at least 90% of the merging company's shares or interim certificates (in case of capital increase, calculated after such increase).not transposed (According to the Act No. 125/2008 Coll., on transformation of business companies and cooperatives, which shall enter into force 1 July 2008) § 132 
stipulates that if the acquiring company is the only shareholder of a merging 
company, the merger shall be approved by the boards of all participating companies;  § 132 stipulates that if the acquiring comapny is owner of all shares with voting rights of the merging company, the merger shall be approved by the boards of all participating companies.   not transposed
Denmark Yes Article transposed Yes not transposed
Estonia no not transposed no not transposed
Finland not transposed not trans posed not transposed
FranceNo. Pursuant to Article L.236-9 of the Code of Commerce, the approval of the general meetings in 
respect of the merging companies is compulsory. Article transposed Article L.236-11 of the Code of Commerce stipulates that the approval of the draft terms of merger by the general meeting of respect of the acquired 
company is not necessary if all the shares representing the total capital of 
the acquired company are held in their entirety by the acquiring company. The approval by the general meeting in respect of the acquiring comapny is however needed. not transposed
Germanyyes not transposed no (under German law a general meeting has to take place for passing 
resolutions on all fundamental issues in a controlled company)Article transposed
Greeceno such exemption in our national law. Approval of the general meeting is in force not transposed No Approval  of the general meeting is needed Article transposed
Hungarynot transposed not transposed not transposed
IrelandArticle transposed Article transposed Article transposedCOUNTRYSimplified mergers - use of the options provided by the Third Directive - Approval of the general meeting
 
 
EN 68   EN ItalyThe merger is decided upon according to the provisions concerning the amendment of the memorandum 
and articles of association (Article 2502 Codice Civile)Article transposed The memorandum or the articles of association may stipulate that the merger by acquisition is decided by the administrative bodies, if the requirements in respect of the draft terms of merger and the depositing of the shares are respected Article transposed
Latviano, due to protection of minority shareholders not transposed no, due to protection of minority shareholders not transposed
Lithuaniayes Article transposed yes Article transposed
LuxembourgArticle transposed Article transposed Article transposed
MaltaYes. Article 345(6) of the Companies Act (Cap. 386) not transposed Yes. Article 358(3) of the Companies Act (Cap. 386) not transposed
NetherlandsArticle transposed not transposed Article transposed
Norway
PolandArticle transposed Article transposed Article transposed
PortugalArticle transposed Article transposed Article transposed
RomaniaArticle transposed Article transposed Article transposed
SlovakiaNo. In the year 2001 when the 3rd Directive was transposed, the option was not included. Nowadays, the 
more profound changes of our Commercial Code, including the simplification measures, await the re-codification of the whole Civil law (which is under way).Article transposed Article transposed Article transposed
SloveniaYes, Companies Act Art. 599 Article transposed Article transposed Article transposed
SpainArticle transposed Article transposed Article transposed
Sweden yes not transposed yes not transposed
United KingdomYes Co Act 2006 S.916 Article transposed Yes Co Act 2006 S.916 Article transposed
* Information in italics is taken from report on measurement of administrative costs by Deloitte/Ramboll/Capgemini
 
 
EN 69   EN Article 27 Third Directive Article 28 Third Directive Article 29 Third Directive 
Austria Yes not transposed * not transposed
Belgium No not transposed not transposed
Bulgaria not transposed not transposed not transposed
CyprusNot applicable not transposed not transposed
Czech Republic (Act No. 125/2008 Coll., on transformation of business companies and cooperatives (as of 1 July 2008) 
§129: where the shares of the acquiring company's existing shareholders are not exchanged, the decision on a merger by 
acquisition may be taken by the acquiring company's board instead of its GM provided that: 
a) SH shall be informed about their rights at least one month before the resolution on the draft terms of merger;
b) at least 1 month before the decision on the draft terms of merger all SH of the participating company must have access to th e 
documents listed in Art. 11 Third Directive and must be entitled to receive, without any undue delay, copies or abstracts (§ 11 9); 
c) one or more SH of the acquiring company holding at least 5% of shares can demand a GM within 1 month after publication. If 
the company has issued shares with no voting rights attached, such shares are not taken into account for the calculation (§131( 1));
d) the acquiring company owns at least 90% of the merging company's shares or interim certificates (in case of capital increase , 
calculated after such increase).Article transposed not transposed
Denmark Yesnot transposed not transposed
Estonia yes, Article 421(4) Commercial Codenot transposed not transposed
Finlandnot transposed not transposed not transposed
FranceNo, since shareholders must have the possibility to take part in all important decisions, including mergers. not transposed not transposed
Germanyyes Article transposed Article transposed
Greeceno such exemption in our national law. Approval of the general meeting is in force not transposed Article transposed
Hungarynot transposed not transposed not transposed
IrelandArticle transposed Article transposed Article transposed
ItalyThere are simplifying measures in terms of documentation on the decision for a merger (e.g. regarding the experts report), but the 
requirement of an approval of the decision is the same as illustrated in the preceding point.Article transposed Article transposed
Latviano, due to protection of minority shareholders not transposed not transposed
Lithuaniayes Article transposed Article transposedCOUNTRYSimplified mergers - use of the options provided by the Third Directive - Approval of the general meeting
 
 
EN 70   EN LuxembourgArticle transposed Article transposed Article transposed
MaltaYes. Article 359(1) of the Companies Act (Cap. 386) Article transposed not transposed
Netherlandsnot transposed not transposed not transposed
Norwa y
PolandArticle transposed Article transposed Article transposed
PortugalArticle transposed Article transposed Article transposed
RomaniaArticle transposed not transposed Article transposed
Slovakia yes Article transposed Article transposed
Sloveniayes, Companies Act Art. 599.1 Article transposed Article transposed
Spainnot transposed Article transposed Article transposed
Swedenyes (cf. 1(a)) not transposed not transposed
United KingdomYes Co Act 2006 S.917 Article transposed Article transposed
* Information in italics is taken from report on measurement of administrative costs by Deloitte/Ramboll/Capgemini
 
 
EN 71   EN Article 6 Sixth Directive Article 20 Sixth Directive Article 23 Sixth Directive 
AustriaYes No not transposed *
BelgiumNo No not transposed
Bulgarianot transposed
CyprusNot applicable Not applicable not transposed
Czech Republic not transposed
Denmark Yes Yes not transposed
Estonia no not transposed
Finland Article transposed
FranceNo. The general meeting remains compulsory since shareholders must have the 
possibility to take part in all important decisions, including divisions.  No. The general meeting remains compulsory since shareholders must have the 
possibility to take part in all important decisions, including divisions.  not transposed
Germany yes no (cf. 1(b)) not transposed
GreeceNo such exemption in our national law. Approval of the general meeting is in 
force.No. Approval of the general meeting is needed not transposed
Hungary not transposed
Irelandpartially transposed
ItalyThe administrative bodies of the companies participating in the division draw up 
the balance sheet and the report accompanying the balance sheet, including the 
experts report. The experts report is not necessary if the division is effected by the 
formation of one or more new companies and if there are no criteria for the allocation of shares other than the pro-quota distribution. For the other procedural 
requirements for the division the respective provisions in terms of mergers apply.The administrative bodies of the companies participating in the division draw up the 
balance sheet and the report accompanying the balance sheet, including the experts 
report. The experts report is not necessary if the division is effected by the formation of 
one or more new companies and if there are no criteria for the allocation of shares other than the pro-quota distribution. For the other procedural requirements for the division the 
respective provisions in terms of mergers apply.not transposed
Latvia no, due to protection of minority shareholders no, due to protection of minority shareholders not transposed
Lithuania no no not transposed
Luxembourg not transposed
Malta Yes. Article 362(6) of the Companies Act (Cap. 386) No. not transposedCOUNTRYSimplified divisions - use of the options provided by the Sixth Directive - Approval of the general meeting
 
 
EN 72   EN Netherlands not transposed
Norway
Polandnot transposed
Portugal not transposed
Romanianot transposed
Slovakia yes yes Article transposed
Sloveniayes, Companies Act Art. 629, 296 NO, option not used not transposed
Spain not transposed
Swedenyes not specifically, but there applies the general rule that shareholders may unanimously set 
aside rules that protect themnot transposed
United KingdomYes -  Co Act 2006 S.931/932 Yes -  Co Act 2006 S.933 Article transposed
* Information in italics is taken from report on measurement of administrative costs by Deloitte/Ramboll/Capgemini
 
 
EN 73   EN ANNEX 4 
Costs of filing draft terms of m erger/division with the register  
 
EN 74   EN COUNTRY (Initial) registration of companies Amendments to the register in general publication of draft terms of merger/division
AustriaCosts depend on the content to be registered:
* basic fee (€ 34,-- for most companies, € 131,-- for public limited companies) * registration fees, e.g.: name of the company: € 8,--; address: € 8,--; capital: € 
131,--; articles of association: € 87,--; directors: € 25,--/each; 
members/shareholders: € 17,--/each; members of the supervisory board € 43,--/eachFees for amendments generally equal the fees for initial 
registrations (except for amendments to the articles of association: € 43,-- instead of € 87,--).For a filing of the draft terms of merger/divison with the 
Commercial Court, only the applicable basic fee has to be paid. In addition, the companies have to bear the costs of publication of 
this filing in the official gazette (€ 100,--).
Belgium* civil companies: none; 
* commercial company: 71 EUR (plus 71 EUR for each accessory branch). This cost is linked to the 'entreprise counters'* civil companies: none; 
* commercial company: amendments : none                              close-up of the company :71€ Publication by mention in the national journal by each concerned 
company : 134,07€ 
Bulgaria* Checking availability of company name and obtaining certificate for the 
registered name: BGN 100 (EUR 51) or 102 BGN (EUR 52) (by phone);* Court fee at the to the bank account of Sofia City Court: state fee for court 
registration and certified copy of the court decision is BGN 121.50 (EUR  62) 
(it may be BGN 122.50 (EUR 62.3) if the court decision is longer than 1 standard typing page)
Cyprus£CY60 (EUR 102) plus 0.6% on the nominal capital £CY60 (EUR 102) plus 0.6% on the nominal capital £CY60 (EUR 102) plus 0.6% on th e nominal capital
Czech 
RepublicRegistration in the Commercial Register: 5000 CZK (EUR 190);
(according to the Act No. 549 of 1991 Coll., on court fees)                                   
ONLY FOR REGISTRATION  IN THE COMMERCIAL REGISTER 
(CHANGES IN REGISTERED INFO AND DELETION OF THE COMPANY), 
NOT FOR FILING OF THE DOCUMENTS IN THE COLLECTION OF 
DOCUMENTSChanges: 1000 CZK (EUR 38);
Deletion: 3000 CZK (EUR 114);
(according to the Act No. 549 of 1991 Coll., on court fees)The draft terms of merger is  filed  in the Collection of Documents 
(which is an integral part of the Commercial Register where all 
documents are filed), filing of the draft terms of merger is free of charge and always in electronic form; then the draft terms of 
merger has to be published in the National Gazette  (sent in 
electronic form from the Commercial Register), fees: 2500 CZK/1Word page (100 EUR); 4900 CZK/2 and more Word pages 
(196 EUR)                               
DenmarkRegister the company with the Danish Commercial and Companies Agency over Webreg system: no chargeno charge no chargeCosts of registration in the central register, commercial register or companies register
 
 
EN 75   EN EstoniaDependent on type of legal person:
- sole trader: 200 EEK (13€), via internet: 200 EEK (13€);- general partnership, limited partnership: 200 EEK (13€), via internet: 200 
EEK (13€);
- commercial association: 2200 EEK (141€), via internet: not possible;- branch of foreign company: 2200 EEK (141€), via internet: not possible;
- private limited company: 2200 EEK (141€), via internet: 2900 EEK (185€);
- public limied company: 2200EEK (141€), via internet: not possible* sole trader, general partnership, limited partnership: 60 EEK 
(4 €), * commercial association, branch of foreign company, private 
limited company, public limied company: 280 EEK (18 €)* general partnership, limited partnership: 60 EEK (4 €), 
* commercial association, private limited company, public limied company: 280 EEK (18 €) 
Finland* registration of new limited company or branch 330 €, partnership 155 €, sole 
trader 60 € * registration of changes 57 €, change of articles of 
association 330 €
France* check company name availability with the Institut National de la Propriété 
Industrielle: no charge (unless deeper research is made, for example, by field of activity);
* request for a company’s registration with the Centre de Formalités des 
Entreprises (CFE): €40 paid to the CFE and €76.19 paid to the trade register in the Commercial court * fees are fixed in the Code of Commerce (decree). They are 
calculated on the basis of a baseline rate, which is currently fixed at 1.30€/unit; 
* the first amendment to the register amounts to 42 units, that 
is 42*1.30€ (54.60€); * any further amendment amounts to 15 units (19.50€).  Fees for publication are fixed in the Code of Commerce (decree). 
The draft terms of merger/division are published in:  * regional newspapers entitled to publish legal announcements: 
fees are fixed by each "préfets" and go from 3€ to 4€ per line;
* in the relevant part of the national gazette ("BALO") - if the company makes direct offers to the public: the fee is 64.60€.
Germany* First registration
- private limited company: 100€ (no 2100 of the Gebührenverzeichnis der 
HRegGebV)- public limited company or KGaA: 240€ (no 2102 of the Gebührenverzeichnis 
der HRegGebV), in the case of a formation against contributions in kind: 290€ 
(no 2103 of the Gebührenverzeichnis der HRegGebV)* Registration of a branch: 90€ (no 2200 of the Gebührenverzeichnis der 
HRegGebV) 
* if the parent company has its seat in another MS: as new registration (100€ or 240 €)* registration of changes  30 € - 170 € (depending on the 
information to be registered) * (until the end of 2008 publication in   a newspaper in addition 
to)   20 €
*  electronical publication    1 €
Greece* Costs for incorporation are dependent on the capital of a company. Example: S.A. with a capital of 60000 Euro the costs are: 60000*1/100 (tax of 
capital concentration) + 60000*1/1000 (tax of competition) + 60000*3/1000 
(approximately for notary's fee), + 544 Euro (publication fee); * publication fee for a branch of a S.A. is 544 Euro.publication fee 289 euro (s.a. companies) publication fee 289 euro (s.a. companies)
 
 
EN 76   EN HungaryThe duty on company registration is:
• 600,000 HUF (EUR 2,340) for public limited companies and European public limited-liability companies,
• 100,000 HUF (EUR 390) for private limited companies and limited liability 
companies,• 50,000 HUF(EUR 195) for unincorporated business associations
• 30,000 HUF (EUR 117) for sole proprietorships
• 250,000 HUF (EUR 975) for the Hungarian branch offices of foreign-registered companies
• 150,000 HUF (EUR 590) for direct commercial representations of foreign 
companies.The duty payable for the registration of companies under simplified proceedings is 15,000 HUF (EUR 59). 
Ireland* The standard fee for registering a company is €100.
* The 'CRODisk' scheme incurrs costs of €50 but this scheme is generally 
limited to frequent presenters of documents. * The standard fee for registering a business name is €40, or €20 if filed 
electronically.€15 per form - resolution, Memo & Arts. Change in company 
details - address, Director info can be filed online for free. 
€100 to change company name.€15 for form CBM1. No fees order introduced to date.
ItalyRegister with the Register of Enterprises (Registro delle Imprese) at the local 
Chamber of Commerce: € 156,00 (registration tax) + € 90,00 (registration with 
Chamber of Commerce) + € 200.00 (membership fees)costs do not change in case of modification costs do not change in case of merger or division 
LatviaRegister at the Ministry of Justice, Register of Enterprises: LVL 125 (176 
(EUR)) (+/- fee for verifying  the signature in case of a sole founder on the 
company's registration application and the sample signatures of the members of 
the Management Boardthis service: LVL 5.5 (EUR 8)
LithuaniaThe costs depend on the type of company to be registered: 
- Private limited liability company: 198 Litas (57,42 €);
- Public limited liability company: 198 Litas (57,42 €),- European company: 198 Litas (57,42 €);- Branch of company: 99 Litas (28,71 €)
- Branch of foreign company: 200 Litas (58 €)Registration of amended document of incorporation costs 92 
Litas (26,56 €), Registration of amendments to the particulars 
or information (one record) cost 10 Litas (2,89 €).There is no fee for the filing of the draft terms of merger/ division 
in the register
 
 
EN 77   EN Luxembourg* Fee dependent on form of company (21 different forms). 
* Costs for Registration of a new company range from 13,70 € to 132,39 €;Examples: SE 132,39 €, limited liability company (société responsabilité 
limitée) 132,39 €.* Changes to the register are devided between 
- statutory changes (13,70 € to 68,48 €) and - other changes (9,13 € to 13,70 €).
* Deletion: from 13,70 € to 132,39 € 
MaltaFrom 350 € to 1,725 €, according to the share capital No fee imposed No fee imposed
Netherlandsdependent on the size of company:
- small companies (capital less than 2.5 million € and less than 50 employees): 54,05 €;
- medium sized companies (capital in between 2.5 million - 10 million € and 50 
- 250 employees): 108,10€;- big companies (capital more than 10 million €, more than 250 employees): 
313,49€
NorwayThe fee is NOK 6000 (which is approximately EUR 750) for registration of 
private limited companies public limited companies, limited partnerships and cooperatives.
For other companies and branches the registration fee is NOK 2500 (EUR 310). 
The registration fee basically covers the lifetime cost for registration in The Register of Business Enterprises.
Poland* The registration of an incorporation of a company as well as a branch costs in total 1000 Zloty (EUR 277). Exception: a partnership costs 750 Zloty (EUR 208). * Changes in the companies register cost 400 Zloty (EUR 
111).
Portugal€360 or €300 (depending on whether the company’s object is IT or IT related or 
not), including mandatory publications but excluding a 0.4% Stamp Tax rate, levied on the amount of the company's share capital subscriptions
RomaniaApproximately:  350 RON (EUR 94)RON 50 (EUR 13) (verification and registration of company's name/emblem) + 
RON 10 (EUR 3) (verification uniqueness of headquarters) + RON 30  (EUR 9) 
(Certificate issued by the trade register office) +  20% of the registration tax: 24 RON (EUR 6) (Dissolution Fund) + 10,00 RON (EUR 3) (Obtaining Unique 
Registration Code) + 5% of the registration tax: EUR 6 (EUR 1) (Fund for the 
Bulletin of judicial reorganization and insolvency procedures) + RON 39 (EUR 10) (stamp duty) + RON 120 (EUR 32) (registration fee) + publication taxes
Subsequent ammendments: RON 30 (EUR 9) for each mandatory element of 
the basic information of the company to be registered.
 
 
EN 78   EN SlovakiaItem No 17 of the Act No 71/1992 stipulates the actual fees for the registration 
in the matters of the Commercial Register as follows:1. Joint Stock Company
SKK 25 000 (EUR 833) (e-registration = 12500 (EUR 417)) 
2. Other legal entitiesSKK 10 000 (EUR 333) (e-registration = 5000 (EUR 167)) 
3. Individual entrepreneur
SKK 5 000 (EUR 167) (e-registration = 2500 (EUR 83)) 4. Branch of a legal entity
SKK 10 000 (EUR 333) (e-registration = 5000 (EUR 167) 
5. Branch of individual entrepreneurSKK 1 000 (EUR 33) (e-registration = 500 (EUR 17))(If a whole application is submitted via electronic means, the fee is only 50% 
of the sum stipulated)• change of legal form 
SKK 10 000 (EUR 333 (e-registration = 5000 (EUR 167)) • change (deletion of an old entry and insertion of a new 
entry) of any number of particulars regarding the same entity 
within the same application – SKK 2000 (EUR 67) (SKK 1000 or EUR 33 for e-registration)
• change of the name of the street/village/town/city, change of 
ZIP code, etc. if the registered office remain the same - free of chargefree of charge
Slovenia* no court taxes for any entry into court register 
Spain* Certification of uniqueness of proposed company name: EUR 7 to 14 
* Public deed of incorporation of the company for its registration with the 
Mercantile Registry: EUR 159
Sweden2000 SEK (EUR 212) for registration of a new company or a new branch 800 SEK (EUR 85) 800 SEK (EUR 85)
United 
KingdomCompany:  £20 (EUR 26)
Branch:  £20 (EUR 26)
Both can request a same day service for £50 (EUR 66).
In addition, companies and branches pay an annual fee of £30 (EUR 40) (this fee applies when a company files its annual return and a branch files its annual 
accounts).Incorporation £20, Electronic Incorporation £15, Change of 
Name £20, Same day change of name  £50,                               
                    Re-registration £20, Annual Returns £30, Same 
day re-registration and change of name £100, Electronic Annual Returns £30, Registration of charge per entry 
£13,Voluntary dissolution £10.Companies deliver to registrar to publish in the Gazette  - no 
specific charges made - but may be re-registration costs see 
general charges.
 
 
EN 79   EN ANNEX 5 
Costs of providing free copies of cer tain documents to shareholders  
Example103: Merger between two large Insurance gro ups (with international activities) 
 
Annual accounts/annual report Issue langua ge 1 Issue language 2 Issue English 
Group 1 (year n-1) 2,500 copies 250 copies 250 copies
Group 1 (year n-2) 2500 copies 250 copies 250 copies
Group 1 (year n-3) 750 copies 250 copies 250 copies
Parent Company 1 (year n-1) 2,500 copies 250 copies 250 copies
Parent Company 1 (year n-2) 2,500 copies 250 copies 250 copies
Parent Company 1 (year n-3) 750 copies 250 copies 250copies
Group 2 (year n-1) 500 copies 500 copies 250 copies
Group 2 (year n-2) 500 copies 500 copies 250 copies
Group 2 (ear n-3) 500 copies 500 copies 250 copies
Company 2 (year n-1) 500 copies 500 copies 250 copies
Company 2 (year n-2) 500 copies 500 copies 250 copies
Company 2 (year n-3) 500 copies 500 copies 250 copies
14,500 4,500 3,000
Total 22,000 copies
 
                                                 
103 Example provided by the Gesamtverband der Deutschen Versicherungswirtschaft (GDV) 
 
EN 80   EN  
Accounting Statement 
(quarterly financial statement) year n Issue language 1 Issue language 2 Issue English 
Group 1 5,500 copies 100 copies 500 copies
Parent Company 1 2,000 copies 100 copies 100 copies
Group 2 1,000 copies 2,000 copies 250 copies
Parent Company 2 1,000 copies 2,000 copies 250 copies
9,500 4,200 1,100
Total 14,800 copies
 
Total number of copies printed 36,800
Number of copies requested ./. 3,600
Copies to be destroyed  33,200
 
Year n: Year of the merger 
 
EN 81   EN ANNEX 6 
Number of limited-liability  companies in the EU 

 
EN 82   EN