Amended proposal for a COUNCIL DIRECTIVE supplementing the Statute for a European association with regard to the involvement of employees
Date: 1993-07-06
Institutions: European Commission
Subjects: approximation of laws, association, labour law

COMMISSION  OF THE EUROPEAN  COMMUNITIES 

C0M(93)  285final 

Brussels,  5 JuI y 1993 

Proposal  for a 

COUNCIL DECISION 

on the conclusion, on behalf of  the  Community, 
of  the Convention on  the Protection of  the 
Marine Environment of  the Baltic Sea Area 

(Helsinki  Convention, as revised  in 1992) 

(presented  by  the Commission) 

EXPLANATORY MEMORANDUM 

Subject: Follow-up to the EP's opinions (Report produced by Mrs Vayssade (PE A3-1/93) 
approved at the January  1993 part-session) on the proposals relating to: 

Regulation on the Statute for a European Association (COM(91)273 final  Syn 386) 
Directive supplementing the Statute for a European  Association with regard to the involvement 
of employees (COM(91)273 final - Syn 387) 

Regulation on the Statute for a European cooperative society (COM(91)273 final  - Syn 388) 
Directive supplementing the Statute for a European cooperative society with regard to the 
involvement of employees (COM(91)273 final  - Syn 389) 

Regulation on the Statute for a European mutual society (COM(91)273 final  Syn 390) 
Directive supplementing the Statute for a European mutual society with regard to the 
involvement of employees (COM(91)273 final - Syn 391) 

1. Content of the Commission's proposals 

To create European statutes enabling cooperatives, mutuals and associations to take advantage of 
the freedom  to provide services and enjoy the right of establishment throughout the Community in 
the same way as companies can, without having to forego their specific character as groupings of 
people. 

2. Amendments acceptable to the Commission to the proposals for regulations and directives on the 
statutes for a European association, a European cooperative society and a European mutual 
society: 

REGULATION ON THE STATUTE FOR A EUROPEAN ASSOCIATION (EA) 

Amendments adopted unchanged: 

1,2,3,  165,6,  8,  15, 16,22 

Amendments adopted in part or in a modified form: 

5: Incorporated in part so as not to destroy the link between founding  legal entities and the 

annexes, and so as not to allow simply any legal entity, including limited-liability 
companies, to set up an EA. 

9: The text has been brought into line with the European company text so as not to jeopardise the 

legal security of EA acts. 

10: 

14: 

20: 

The text has been brought into line with the European company text. 

Incorporated  in the Regulation, albeit in a modified  form. 

Incorporated  in a modified  form  so as to read: The EA is to have access to all forms of 
financing  under the most favourable conditions applying to associations in the state in 
which it has its registered office  and in the Member States in which it has its 

establishments. 

Amendments  not adopted. 

7:  Art.  3(3) 

Article 20 mentions decisions affecting  a particular category of 
members. 

11 :  Art.  6(3) 

Not adopted  as otherwise the applicable law would  be the sum of 
national  laws without any real  European  legal  personality. 

137: Art.  7(4) 

The problem  is resolved  by the Annex. 

12:  Art.  20 

The statute provides  for  different  categories of  members  (Art. 
3(3)); consequently,  the text of  Article 20 must be consistent  with what 
goes before. 

13:  Art.  20(2) 

as for  amendment  12 

17:  Art.  37(1) 

pointless and  redundant  addition 

18:  Art.  38 

19:  Art.  39 

redundant 

redundant 

21:  Annex 

The linkage between  Article 3 and the Annex is  fundamental, 

otherwise any legal entity could  set up an  EA. 

REGULATION ON THE STATUTE FOR  A EUROPEAN COOPERATIVE SOCIETY 

(SCE) 

Amendments adopted  unchanged: 

46,  47,  51, 56,  59,  60,  62, 63, 65, 66,  69, 74. 

Amendments adopted  in part or in a modified  form: 
53: 

Modified  on the grounds that destroying  all links with legal entities listed  in the Annex 
is not acceptable;  it would amount  to allowing any legal entity,  including  limited-
liability companies,  to create an  SCE. 

58: 

Incorporated  in  modified  form:  the minimum  capital  where a cooperative is set up by 
natural persons is ECU 50 000 rather  than  ECU  15 000. 

68/70:  Although  these amendments are redundant,  they are still acceptable,  given  that compliance 

with  the provisions in question  is an essential  condition  for  the creation  of an SCE. 

71: 

Reference  to branches is a technical  error;  these are fully-fledged  legal persons, 
which  means that they are de facto  subject  to the law of the country  in which  they are 
located.  As far  as establishments  are concerned,  the fact  that any entity  has  free 
access to the capital  market  makes such  reference  superfluous. 

Other amendments not adopted. 

48:  Art.3(2)(l) 

The Commission  text is consistent  with  Article 4.  If  Article 4 were 

to be amended,  consideration  could be given  to the amendment. 

49:  Art.  4(1) 

This amendment  would jeopardize the legal  security  of SCE acts. 
However,  it has been  brought  into line with  the European  company 

text. 

50:  Art. 4(2) 

The Commission text is consistent. However, it has been brought into 
line with the European company text. 

Art. 4(4)(2)  Redundant. This Regulation has no effect  on sectoral regulations. 

52:  Art. 5(5) 

This amendment creates greater security vis-a-vis third parties, but its 
effect  would be to make the responsibility of persons who have taken 
steps in the name of an SCE greater than is required under the 
European company arrangements. 

54:  Art. 9(2a)(new)  The possibility of merger provided for in this amendment does not 

exist even for companies with share capital, as the Directive is still 
blocked at the EP. Anyway, the amendment would be inadequate as 
numerous articles would be needed to define the merger conditions. 

55:  Art.  11(4) 

The amendment is incomplete. 

57:  Art.  13(1) 

This amendment might create certain privileges. 

61:  Art.  18(1) 

25% seems reasonable, especially as this percentage can be 

reduced by the statutes. 

67:  Art. 28 

The Commission text is more flexible and refers back to the 

statutes regarding the application arrangements. 

72:  Art. 51a 

This text should be incorporated into the EP's opinion, if appropriate, 

since all it does is to set out guidelines. 

73:  Art. 54(2)(3)  This problem could be resolved by the organization's statutes. 

75:  Annex I 

The linkage between Article 9 and the Annex is fundamental. 

Otherwise any legal entity could set up an SCE. 

REGULATION ON THE STATUTE FOR A EUROPEAN MUTUAL SOCIETY 

Amendments adopted: 

163/corr., 98,  100,  102, 104, 105, 107,  111, 114. 

Amendments adopted in part or in a modified form: 

164/corr.,  106,  108, 109 

103: 

The introduction of a criterion linked to the number of  members in respect of the 
conversion of an establishment or a subsidiary has been looked at with a view to not 
making it virtually impossible to set up an ME in this way; the 500-member criterion 
has been retained. 

Other amendments not adopted. 

101: Art.  1(5) The Regulation does not affect  the basic obligatory social security schemes 
run in some cases by provident mutuals, nor does it affect  the freedom of 
Member States to decide whether or not - and subject to what conditions - to 
allow European mutuals to run such schemes. 

110: Art.  44 

This amendment  would  make it difficult  - not to say impossible - to 

keep a check on the obligations arising  from  the insurance and banking 
directives. 

DIRECTIVES  SUPPLEMENTING  THE STATUTES  FOR EA.  SCE AND ME 

Amendments adopted  unchanged: 

25,  39,  40,  43 (EA) 
79,  87,  88,  89, 90, 93, 94 (SCE) 

116,  130,  131,  134,  135 (ME) 

Amendments adopted  in modified  form: 

37,  41  (EA) 
91,155  (SCE) 
129 and  156,  132 and  161 (ME) 

Other amendments  not adopted: 
- 23, 24, 26, 27, 28, 29, 30, 31, 32, 33, 34,  35, 36, 38, 42, 44, 45  (EA) 
- 76, 77,  78,  80,  81, 82,  83, 84,  85,  152,  86,  153,  154, 92, 95, 96 (SCE) 
-  117,  118,  119,  120,  121, 122,  123,  124,  125,  126,  157,  127,  158,  128,  159,  160,  133, 136 
(ME) 

Political  option  on the part of the Commission: 

The Commission's proposal  (Article 2)  makes reference  to national provisions  governing 
the participation  of employees in the supervisory  or administrative boards of  national 
associations, cooperatives and mutuals.  However,  where the Member State hosting  the 
registered  office  has no rules and regulations on  the participation  of workers,  or does not 
intend  to apply  such provisions to EAs,  SCEs and  MEs,  it must at least comply  with  the 
minimum  requirements as set out in Articles 3, 4,  5,  6 and 7 of the directives  concerning 
information  and  consultation. 

The EP's amendments, on the other hand,  impose information,  consultation  and 
participation  procedures  for  the creation  of EAs,  SCEs and  MEs. 

The Commission  is restricting  the scope of the directives to consultation  and  information 
procedures,  leaving the Member States a free  hand as regards participation  or to establish 
norms  for  participation  which  will be equivalent  to those concerning  information  and 
consultation. 

6" 

Amended proposal for a Council regulation on the statute for a European 
association 

SYN 38S 

THE  COUNCIL  OF  THE  EUROPEAN  COMMUNITIES, 

Having regard to the Treaty establishing the European Economic Community, and 
in particular Article  100a thereof, 

Having  regard to the proposal  from the Commission, 

In cooperation with the European Parliament, 

Having regard to the opinion of the Economic and Social Committee, 

Whereas the European Parliament adopted  a resolution on 13 March  1987 on non 
profit-making associations  in the European  Communities(1); 

Whereas the Commission adopted  a communication  to the Council of  18 December 
1989(2); whereas the Economic and Social Committee gave  its opinion on that 
communication on 19 September  1990^3); 

Whereas the completion of the internal market means that there must be full 
freedom of establishment  for all activities which contribute to the 
objectives of the Community, irrespective of the form taken by the body which 
carries them on; 

Whereas associations in Europe help to promote the general  interest and to 
develop many and various activities in fields such as education, culture, 
social work or development aid; 

Whereas  foundations are entities to which have been irrevocably  allotted 
goods, rights and resources for carrying out work which  is of public 
interest; 

Whereas associations and foundations are therefore above all entities which 
act without the main  intention of securing  a profit and which operate in 
accordance with their own principles, which are different  from those applying 
to other businesses; 

(AMENDMENT No 1) 

Whereas today many associations and  foundations, in pursuit of their  aims, 
play a full part  in the life of the economy, by engaging on a regular  basis 
in some economic  activity, as their main activity or as a secondary one; 

Whereas cross-border  cooperation between associations and  foundations  is 
currently hampered by legal and administrative difficulties  in the Community 
which  should be eliminated  in a market without frontiers; 

Whereas the introduction of a European  form of organization  should enable all 
associations and  foundations to operate outside their own national borders in 
all or part of the territory of the Community; 

(1)  OJ No C 99, 13.4.1987, p. 205. 
(2)  Businesses  in the  'économie sociale' sector - Europe's frontier-free 

market: SEC(89) 2187 final. 
(3)  OJ No C 332, 31.12.1990, p. 81. 

G 

Whereas, therefore, the Community, which  is concerned to respect equal terms 
of competition  and to contribute to its economic development, should provide 
associations  and  foundations, which are a form of organization  generally 
recognized  in all Member States, with an adequate  legal  instrument capable of 
facilitating the development of their transnational activities; 

Whereas the Statute for a European company, as provided  for in Regulation 
(EEC) No  . .  .(^),  is not an instrument which  is suited to the specific 
features of associations and foundations; 

Whereas the European Economic  Interest Grouping  (EEIG), as provided  for in 
Regulation  (EEC) No 2137/85(5), does allow certain activities to be carried 
on in common, while nevertheless preserving the independence of its members, 
but  it does not meet the specific requirements of associations or 
foundations; 

Whereas  it is therefore  fitting to establish  at Community  level adequate and 
specific  rules which will permit the creation of European associations; 
whereas  it seems appropriate to enable foundations to take advantage of these 
rules and so to set up European associations; whereas, nevertheless, any 
European association established by foundations will be governed,  as regards 
its constitution  and functioning, by the provisions of the said set of rules; 

Whereas the European associations  (hereinafter  referred  to as the EA) 
exemplifies a People's Europe in helping and encouraging  individuals to play 
an active role in the life of the Community; whereas  it is fitting that 
natural persons should also be able to establish a European association ab 
initio; 

Whereas respect  for the principle of the primacy of the individual is 
reflected  in the specific rules on membership, resignation and expulsion, 
where the  'one man, one vote* rule is laid down and the right to vote is 
vested  in the individual, with the implication  that members cannot share in 
the profits realized or exercise any rights over the assets of the EA; 

Whereas the essential aim of the legal rules governing  the EA implies that 
such an assocation may be constituted  by natural persons coming  from  (and 
resident  in) two Member States of the Community, or by  legal entities  from 
two different Member States and by transformation of a national  association 
without  first being wound up so long as the association has its registered 
office and central administration  in the Community  and an establishment  in a 
Member State other than that  in which  it has  its central administration; in 
this  last case, the assocation must engage  in genuine and effective cross-
border  activity; 

Whereas the rules on accounting  are intended  to ensure more effective 
management  and to forestall  any possible difficulty; 

Whereas, on matters not covered  by this Regulation, the provisions of the law 
of the Member States and of Community  law are applicable,  for example with 
regard to: 

-  rules on employee  involvement  in the decision-making process, 

- employment  law, 

- taxation  law, 

(4)  OJ No 
(5)  OJ No L 199, 31.7.1985, p. 1. 

-  competition  law, 

=\ 

-  intellectual and industrial property  law, 

- rules on  insolvency  and suspension of payments; 

Whereas the application of this Regulation must be deferred  so as to enable 
each Member State to incorporate  into its national  law the provisions of the 
Council Directive supplementing  the Statute  for a European association with 
regard to the involvement of employees(") in the EA and to put  in place in 
advance the necessary machinery  for securing  the formation and operation of 
EAs having their registered office  in its territory,  so that the Regulation 
and the Directive may be applied  concomitantly; 

Whereas work on the approximation of national company  law has made 
substantial progress so that reference may be made to certain dispositions 
made by the Member State where the association has its registered office for 
the purpose of implementing directives on companies, by analogy  for the EA in 
areas where the functioning of the association does not require uniform 
Community  rules, such dispositions being appropriate to the arrangements 
governing the EA: 

- Council Directive 68/151/EEC of 9 March  1968 on coordination of  safeguards 
which, for the protection of the interests of members and others, are 
required by Member States of companies within the meaning of the second 
paragraph of Article 58 of the Treaty, with a view to making  such  safeguards 
equivalent throughout the Community^ ) as last amended by the Act of 
Accession of Spain and Portugal, 

- 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(®), as last 
amended by Directives 90/604/EEC(9) and  90/605/EEc(10), 

- Council Directive 83/349/EEC of  13 June  1983 based on Article  54  (3) (g) of 
the Treaty on consolidated  accounts(^) as last amended by  Directives 
90/604/EEC and 90/605/EEC, 

- Council Directive 84/253/EEC of  10 April  1984 based on Article  54  (3) (g) 
of the Treaty on the approval of persons responsible  for carrying out the 
statutory  audits of accounting documents( "  )/ 

- Council Directive 89/48/EEC of 21 December  1988 on a general  system  for the 
recognition of higher-education diplomas awarded  on completion of 
professional  education and training  of at  least three years' duration^^), 

- Council Directive 89/666/EEC of 21 December  1989 concerning  disclosure 
requirements  in respect of branches opened  in a Member State by certain types 
of company governed by the law of another  State(14); 

Whereas  recourse to this set of  rules should  be optional, 

(6)  OJ L 
(7)  OJ No L 65, 14.3.1968, p. 8. 
(8)  OJ No L 222, 14.8.1978, p. 11. 
(9)  OJ No L 317, 16.11.1990, p. 57. 
(10)  OJ NO L 317, 16.11.1990, p. 60. 
(11)  OJ No L 193, 18.7.1983, p. 1. 
(12)  OJ No L 126, 12.5.1984, p. 20. 
(13)  OJ No L 19, 24.1.1989, p. 16. 
(14)  OJ No L 395, 30.12.1989, p. 36 

HAS  ADOPTED  THIS  REGULATION: 

TITLE  I 

GENERAL  PROVISIONS 

Chapter  I 

Formation of the European  association 

Article 1 

(Form of the European  association) 

1.  (AMENDMENT No 2) 

A European association  (EA) shall be a permanent grouping of natural and/or 

legal persons whose members pool their knowledge or their activities either 
for a purpose in the general  interest or  in order to promote the trade or 
professional  interests of its members  in the most diverse areas. 

2. Subject to the application at national  level of the legal and 
administrative rules governing the carrying on of an activity or the exercise 
of a profession, the EA shall be free to determine the activities necessary 
for the pursuit of  its objects, provided they are compatible with the 
objectives of the Community, Community public policy and the public policy of 
the Member States. It shall pursue them in accordance with the principles 
which derive from its character as a grouping of persons, and shall be 
managed  in a disinterested  fashion. 

(AMENDMENT No 3) 

The profits from any economic activity  carried out by the EA shall be devoted 
exclusively  to the pursuit of  its objects, and may not be divided amongst the 
members. 

Article 2 

(Legal  personality) 

1. An EA shall have legal personality.  It shall acquire  it on the day of its 
registration  in the Member State  in which  it has its registered office, in 
the register designated  by that State  in accordance with Article 7 (3). 

2.  (AMENDMENT No 165) 

An EA's legal personality  shall  include  in particular the following  rights 

necessary  for the pursuit of the EA's objects: 

a) to conclude contracts and perform other  legal acts; 

b) to acquire movable and  immovable property; 

c) to receive donations and  legacies, including  through appeals to public 
generosity; 

d) to employ staff; 

e) to be a party to legal proceedings. 

3 

3. The liability of the EA shall be limited to its assets. 

Article 3 

(Formation and  rules) 

1. The following may  form an EA: 

(AMENDMENT No 5, in part) 

-  two or more legal entities, formed under the law of a Member State, set out 
in the Annex and having their registered  office and central administration in 
at  least two Member States, 

-  at least 7 natural persons resident  in at least two Member States; 

- one or more legal entities, listed  in the Annex, in agreement with seven or 
more natural persons resident  in at least two Member States. 

2.  (AMENDMENT No 6) 

An association which has been formed  in accordance with the law of a Member 

State and has its registered office and central administration  in the 
Community, may form an EA by converting  into EA form if it has, for at least 
two years, had an establishment  in a Member State other than that of its 
central administration. Such conversion  shall not result  in the association 
being wound up or in the creation of a new legal person. 

The registered office may not be transferred  from one Member State to another 
on the occasion of such conversion. 

The executive committee of such an association  shall draw up a proposal for 
conversion covering the legal and economic aspects of the conversion. 

The conversion to EA form and the EA's statutes shall be approved by the 
general meeting of the members in accordance with the requirements  laid down 
for amendment of  its statutes in Article 19. 

3. The statutes of the EA must include: 

-  its name, preceded or  followed by the abbreviation 'EA', 

-  a precise statement of its objects, 

-  the name, address, occupation  and nationality  of the founder members, where 
these are natural persons, 

-  the name, objects and registered  offices of the founder members, where 
these are legal entities, 

-  the address of the EA's registered  office, 

- the conditions and procedures  for the admission, expulsion  and  resignation 
of members, 

- the rights and obligations of members, and  the different  categories of 
member  if any, and the  inputs and obligations of members  in each category, 

-  the powers and  responsibilities of the executive committee, and the extent 
of  its authority  to represent  the EA  in dealings with third parties, 

- provisions governing  the appointment  and removal of the members of the 

executive committee, 

An 

- the majority  and quorum requirements, 

4 1. 

- the conditions  for the initiation of proceedings on behalf of the EA under 
Article 34, 

- the grounds for winding up. 

4. For the purposes of this Regulation the  'statutes' of the EA comprise both 
the instrument of  incorporation and, where they are set out  in a separate 
document, the EA's statutes properly  so-called. 

Article 4 

(Registered  office) 

The registered  office of an EA shall be situated at the place specified in 
its statutes, which must be within the Community.  It shall be the same as the 
place where the EA has its central  administration. 

Article 5. 

(Transfer of registered  office) 

1.  (AMENDMENT No 8) 

The registered  office of an EA may be transferred  to another Member State in 

accordance with paragraphs 2 to 9 below.  Such transfer  shall not result in 
the EA being wound up or in the creation of a new legal person. 

2. A transfer proposal shall be drawn up by the management or executive 
committee and be published  in accordance with Article 7, without prejudice to 
any additional  form of publicity provided  for by the Member State in which 
the registered office is situated.  This proposal shall  include details of: 

a) 
b) 

c) 

the registered  office proposed  for the EA, 
the statutes proposed  for the EA  including, where appropriate, its new 
title, 
the timetable proposed  for the transfer. 

2(a) The management or executive committee  shall draw up a report explaining 
and  justifying  the legal and economic aspects of the transfer  for the 
attention of members and workers. 

2(b) The members and creditors of the EA shall, at least one month prior to 
the general meeting  called  to decide on the transfer, have the right to 
examine, at the registered office of the EA, the transfer proposal  and the 
report drawn up by virtue of 2(a) and to obtain copies of these documents 
free of charge on request. 

2(c) A Member State may, in respect of EAs registered  on  its territory, adopt 
provisions to ensure appropriate protection  for members  in the minority who 
voted  against the transfer. 

3. No decision to transfer may be taken  for two months after publication of 
the proposal.  Any  such decision must be governed  by the conditions  laid down 
for the amendment of the statutes. 

A  3> 

4. The creditors and holders of other rights vis-à-vis the EA which predated 
publication of the transfer proposal may  require the EA to constitute an 
appropriate guarantee in their  favour.  Exercise of this right shall be 
governed by national  law in the State in which the EA had  its registered 
office prior to transfer. 

A Member State may extend the application of the above provision to  include 
debts made by the EA with public entities prior to the date of transfer. 

5. In the Member State in which the EA has  its registered  office, a court, 
notary or other competent authority  shall issue a certificate to the effect 
that the acts and  formalities required  prior to transfer  have been properly 
completed. 

6. The new registration may not be effected until the certificate provided 
for in  (5) has been produced and evidence has been furnished of completion of 
the formalities required  for registration  in the country of the EA's new 
registered office. 

6(a) Transfer of the EA's registered  office and the resulting change of 
statutes shall take effect on the date on which the EA is registered  in the 
register  for its new registered office, in accordance with Article 7. 

7. The removal of the EA from the register  for its previous registered  office 
may not be effected until evidence has been produced that the EA has been 
registered  in the register  for its new registered office. 

8. The fact of the new registration and the fact of the removal of the old 
registration shall both be published  in the Member States concerned, in 
accordance with Article 8. 

9. The new registration of the registered  office of the EA may be relied on 
as against third parties from publication.  However, until the removal of the 
EA  from the register  for its previous registered office has been published 
third parties may continue to rely on the old  registered  office unless the EA 
proves that such third parties were aware of the new registered office. 

10. A Member State's legislation may, in respect of EAs registered  in that 
country, provide for any transfer of registered office giving rise to a 
change in the applicable  law not to take effect where, within the period of 
two months specified  in  (3), a competent  authority  from that country  lodges 
an objection.  Such objection may only be lodged  for reasons of public 
interest.  It must be possible to appeal against any  such ruling to a 
judicial body. 

11. An EA which  is the subject of winding-up,  liquidation,  insolvency, 
suspension of payments or other  such procedures may  not transfer  its 
registered office. 

Article 6 

(Applicable  law) ' 

(AMENDMENT No 9, aligned with European Company  terms) 

1. An EA shall be governed: 

a) - by the provisions of this Regulation, 

b) - where expressly  authorized  by this Regulation, by the provisions  in the 
statutes of the EA; 

A^\ 

c) - for matters not dealt with by this Regulation or, where a matter  is 
dealt with only partially, for the aspects not covered by this Regulation: 

- 

- 

the legal provisions adopted  by the Member States in application 
of Community measures dealing  specifically with EAs; 
the legal provisions  in Member States applying to the legal 
entities set out  in the Annex  and constituted  in conformity  with 
the legislation of the Member State in which the EA has its 
registered office; 
the provisions of statutes under the same conditions as for the 
legal entities set out  in the Annex and constituted  in accordance 
with the legislation of the Member State in which the EA has its 
registered office. 

2.  (AMENDMENT  No 10, aligned with Euopean  Company) 

Where a Member State comprises  several territorial units, each of which has 

its own rules of  law applicable to the matters referred  to in paragraph 1, 
each territorial unit shall be considered  a Member State for the purposes of 
identifying  the law applicable under this paragraph. 

3. In each Member State and subject to the express provisions of this 
Regulation, an EA shall have the same rights, powers and obligations as one 
of the legal entities set out  in the Annex  and  formed under the law of the 
Member State in which the EA has its registered office. 

Article 7 

(Registration and disclosure  requirements) 

1. The founder members shall draw up the statutes of the EA in accordance 
with the provisions  for the formation of associations  laid down by the law of 
the State in which the EA has  its registered  office. The statutes must at 
least be in writing  and signed by the founder members. 

2.  In those Member States whose  legislation does not provide for any 
precautionary  supervision, whether  administrative or  judicial, at the time of 
formation, the statutes shall be adopted by notarial  act. The  supervisory 
authority  shall ensure that this act complies with the requirements  for the 
formation of an EA, and  in particular  those set out  in Articles 1 to 4. 

3. Member  States shall designate the register  in which EA's must be 
registered  and  shall determine the rules governing  it. They  shall  lay down 
the procedures  for filing the EA's statutes. No EA may be registered  until 
the measures provided  for in the Directive  [supplementing  the Statute  for a 
European association with regard  to the involvement  of employees] have been 
adopted. 

4. Member  States  shall take the measures  required  to ensure that the 
following  documents and particulars  are disclosed  as provided  for in 
paragraph  3: 

(a) the statutes of the EA, any amendments to them, and the complete text of 
the statutes  in its up-to-date  form; 

(b) the opening or closing  of any establishment; 

(c) the appointment, termination  of office and particulars of the persons who 
either  as a body  constituted  pursuant  to law or as members of any  such body: 

AS 

-  are authorized  to represent the EA  in dealings with third parties and in 
legal proceedings, 

- take part in the administration, supervision or control of the EA; 

(d) the balance sheet and the profit and  loss account  for each  financial 
year; the document containing the balance sheet shall give particulars of the 
persons who are required by  law to certify  it; 

(e) any proposal to transfer the registered  office as referred to in Article 
5 (2); 

(f) the winding-up and liquidation of the EA and the decision to continue the 
EA's activities taken pursuant to Article 42; 

(g) any declaration of nullity of the EA by a court; 

(h) the appointment of  liquidators, particulars of  such  liquidators and their 
respective powers, the termination of their office. 

(i) the conclusion of the liquidation of the EA and the removal of the EA 
from the register. 

5. If, prior to its acquisition of  legal personality,  steps have been taken 
in the name of an EA nad the EA does not assume the obligations arising  from 
those steps, the persons who took them  shall be jointly  and severally  liable 
therefor, unless otherwise agreed. 

Article 8 

(Publication of documents and particulars relating to the EA in the Member 
States) 

1.  Member States shall ensure that the documents and particulars referred to 
in Article 7  (4) are published  in the appropriate official gazette  in the 
Member State in which the EA has its registered office, and shall determine 
by which persons the disclosure  formalities are to be carried out. Disclosure 
shall be effected by.publication either of an extract or of a reference to 
the entry  in the register. 

Member States shall also ensure that anyone may consult  the documents 
referred to in Article 7  (4) in the register  referred  to  in Article 7 (3), 
and may obtain a copy of the whole or any part, by post  if requested. 

Member States shall take the necessary measures to avoid  any  descrepancy 
between what  is disclosed  by publication  and what appears  in the register. 
However, in cases of discrepancy, the text published may  not be relied on as 
against third parties; the latter may  nevertheless  rely thereon, unless the 
EA proves that they  had knowledge of the texts entered  in the register. 

Member States may  require payment of  a fee  for the services referred  to in 
the preceding  subparagraph, but the  fee may  not exceed  the  administrative 
cost. 

2. The national rules adopted  pursuant  to Directive 89/666/EEC shall apply to 
branches of an EA opened  in a Member  State other  than that  in which  it has 
its registered office. 

3. Documents and particulars may be relied on by the EA as against third 
parties only after they have been disclosed  in accordance with paragraph  1, 
unless the EA proves that the third party had knowledge thereof. However, 
they may not be relied on in respect of transactions which take place before 
the 16th day after publication  as against third parties who prove that they 
could not have had knowledge thereof. 

4. Third parties may rely on any documents and particulars  in respect of 
which the disclosure  formalities have not yet been completed, save where non 
disclosure causes them not to have effect. 

Article 9 

(Notice in the Official  Journal) 

Member States shall ensure that a notice stating that an EA has been 
registered  or that the liquidation of an EA has been concluded  is published 
for information purposes  in the Official Journal of the European Communities, 
stating the number, date and place of registration of the EA, the date and 
place of publication and the title of the publication, the address of the EA 
and a summary of  ists objects and that these particulars are forwarded to the 
Office  for Official Publications of the European Communities within one month 
of the date of the publication  in the official gazette of the Member State in 
which the EA has its registered  office pursuant to Article 8 (1). 

Where the registered  office of the EA is transferred  in accordance with 
Article 5 a notice shall be published  containing the information provided  for 
in the first paragraph, together with that relating to the new registration. 

Article  10 

(Particulars to be stated  in the EA's documents) 

Letters and documents sent to third  parties shall state  legibly: 

(a) the name of the EA, preceded  or  followed by the abbreviation 'EA'; 

(b) the place of the register  in which the EA is registered  in accordance 
with Article 7  (3), and the number of the EA's entry  in that register; 

(c) the address of the EA's registered office; 

(d) the fact that the EA  is in liquidation or under the administration of the 
courts  if that  is so. 

Chapter  II 

General meeting 

Article 11 

(Competence) 

The general meeting  shall decide on: 

ni 

(a) matters  for which  it has sole responsibility  under  this Regulation; 

(b) matters  for which the executive committee does not have sole 
responsibility  as a result of: 

- this Regulation, 

- the Directive  [supplementing the Statute  for a European association with 
regard to the involvement of employees], 

- the law of the State where the EA has  its registered office, 

- the statutes of the EA. 

Article 12 

(Rules applicable to the convening, organization  and conduct of general 
meeting) 

Subject to this Regulation, the convening, organization  and conduct of 
general meetings  shall be governed by the statutes adopted  in accordance with 
the  laws, regulations and administrative  provisions concerning  the  legal 
entities of the Member State in which the EA has its registered  office set 
out in the Annex hereto. 

Article 13 

(Convening of general meeting) 

1. A general meeting  shall be held at least once a year, not more than six 
months after the end of the EA's  financial year. 

2. General meetings may be convened  by the executive committee at any time 
either on its own  initiative or at the request of at least 25 % of the 
members; the statutes may set a lower proportion. 

3. The request  for a meeting  shall  state the reasons  for convening  it and the 
items to be included on the agenda. 

4.  If, following  a request made pursuant  to paragraph  2, the necessary  steps 
have not been taken within a month, the competent  judicial or  administrative 
authority of the State where the EA's registered  office  is situated may order 
the convening  of a general meeting  or authorize either the members who have 
requested  it or their  representative  to convene the meeting. 

5. A general meeting may, during  a meeting, decide that  a further meeting be 
convened  and set the date and the agenda. 

6. The agenda  for the general meeting  held after the end of the  financial 
year  shall  include at  least the approval of the annual accounts  and of the 
appropriation  of the profit or treatment  of the  loss, the approval of the 
budget estimates, and,  if applicable, the approval  of the annual  report 
referred  to in Article 46 of Directive  78/660/EEC, to be submitted  by the 
executive committee. 

Article 14 

(Addition of items to the agenda) 

Not  less than 25 % of the members of the EA, which proportion may be reduced 
by the statutes, may, within ten days of receipt of the notice convening a 
general meeting, request the addition of one or more  items to the agenda. 

Article 15 

(Attendance and proxies) 

Each member  shall be entitled  to attend the general meeting; he may  appoint 
another member to represent him. A member may not represent more than two 
others. 

Article 16 

(Right to information) 

All members of the EA shall have an equal  right of access to information, 
particularly  on accounting matters, both before and at general meetings. 

This information  shall be made available to members at the EA's registered 
office at least one month before the holding of the meeting. 

In particular, before the general meeting that  follows the end of the 
financial year, members may examine any accounting documents that must be 
drawn up in accordance with the national measures adopted pursuant to 
Directives 78/660/EEC and 83/349/EEC. 

Article 17 

(Voting  rights) 

1. Each member  shall have one vote. 

2. The statutes may make allowance  for postal voting and shall  lay down the 
appropriate procedures. 

Article  18 

(Normal majority) 

Decisions  shall  be taken by a majority  of the votes of the members present or 
represented. 

Article 19 

(Special  majority) 

The general meeting  shall have sole power to amend  the statutes of the EA; 
any  such resolution  shall be passed  by a majority  of two thirds of the votes 
of the members present or  represented. 

A9 

A Member State may provide that the executive committee  is to amend the 
statutes where  it is ordered to do so by a court or administrative  authority 
whose authorization  is required  for amendments to the statutes. 

Article 20 

(Resolutions affecting the rights of a class of member) 

Where a resolution of the general meeting would affect the rights of a 
particular  class of member, it must be approved by those members by a 
separate vote. 

Where the statutes are to be amended  in a way which affects a particular 
class of member, those members shall decide by a majority  of two thirds of 
the votes cast. 

Article 21 

(Actions challenging  resolutions of the general meeting) 

Decisions of a court or competent  authority declaring a resolution of the 
general meeting void or non-existent  shall be the subject of disclosure in 
accordance with Article 8. 

Chapter  III 

The executive  committee 

Article 22 

(Functions of the executive committee; appointment  of members) 

1. The executive committee shall manage the EA. The member or members of the 
executive committee shall have the power to represent the EA  in dealings with 
third parties and  in legal proceedings  in accordance with the measures 
adopted pursuant to Directive 68/151/EEC by the Member State  in which the EA 
has its registered office. 

2. The executive committee shall have at  least three members, with the 
maximum number  fixed by the statutes. 

3. The executive committee may delegate to a committee composed of one or 
more of  its members the power of management. It may also delegate  certain 
management  responsibilities to one or more persons not members of the 
executive committee; such management  responsibilities may be revoked  at any 
time. The statutes, or  if the statutes are silent, the general meeting, shall 
lay down the conditions within which  such delegation  shall operate. 

4.  (AMENDMENT No  14, modified) 

With the exception of the election of the employees'  representatives 

pursuant  to Directive  .../.../EEC, the member  or members of  the executive 
committee shall be appointed  and  removed  by the general meeting. 

Article 23 

2o 

(Holding of meetings and right to  information) 

1. The executive committee shall meet at least once every three months, at 
intervals  laid down by the statutes, to discuss the progress and  foreseeable 
prospects of the EA's affairs. 

2. The executive committee shall meet to deliberate on the operations 
referred  to in Article 30. 

3. Each member of the executive committee  shall be entitled  to examine all 
reports, documents and information  supplied  to the committee concerning  the 
activities of the EA. 

Article 24 

(Chairmanship, calling of meetings) 

1. The executive committee shall elect a chairman  from among  its members. 

2. The chairman  shall convene a meeting of the executive committee  under the 
conditions  laid down in the statutes, either on his own  initiative or at the 
request of at least one third of the members. The request must  indicate the 
reasons  for calling the meeting.  If the request  is not satisifed  within 
fifteen days the meeting of the administrative  board may be called  by those 
who made the request. 

Article 25 

(Term of office) 

1. Members of the executive committee shall be appointed  for a period  laid 
down  in the statutes not exceeding  six years. 

2. Members may be reappointed  one or more times  for the period  laid down in 
accordance with paragraph 1. 

Article 26 

(Conditions of membership) 

1. The statutes of the EA may permit a legal entity  to be a member of the 
executive  committee provided  that the  law applicable to the legal entities 
set out  in the Annex of the State  in which the EA has its registered  office 
does not provide otherwise. 

That  legal entity  shall designate  a natural  person  as  its representative to 
exercise  its functions on the board  concerned. The representative  shall be 
subject  to the same conditions and obligations  as  if he were personally a 
member  of the board. 

2. No person may be a member of the executive committee nor a representative 
of a member within the meaning of paragraph  1, nor have conferred  on him 
powers of management  or representation, who: 

21 

- under the law applicable to him, or 

- under the law applicable to the legal entities set out  in the Annex of the 
State in which the EA has its registered office, or 

- as a result of a judicial or administrative decision delivered or 
recognized  in a Member State, 

is disqualified  from serving on the executive committee, or management, or 
supervisory board of a legal entity. 

Article 27 

(Inability to continue in office) 

The statutes of the EA may provide for the appointment of an alternate member 
where a member of the executive committee  is permanently prevented  from 
continuing  in office. The term of office of the alternate member shall expire 
no later than the end of the term of office of the member whom he has 
replaced. However, a new full member may be appointed  at any time. 

Article 28 

(Rules of procedure) 

The executive committee may draw up rules of procedure under the conditions 
laid down by the statutes of the EA. Any member of the EA or competent 
authority may consult those rules of procedure at the registered office of 
the EA. 

Article 29 

(Power of representation; liability of the EA) 

1. Where the authority to represent the EA  in dealings with third parties, in 
accordance with Article 22  (1), is conferred on two or more members, those 
persons shall exercise that authority  collectively. 

2. However, the statutes of the EA may provide that the EA shall be validly 
bound either by each of the members acting  individually  or by two or more of 
them acting  jointly. Such a clause may be relied upon against third parties 
where  it has been disclosed  in accordance with Article 7. 

3. Acts performed by members of the governing  body of the EA shall bind the 
EA vis-à-vis third parties even where the acts in question are not in 
accordance with the objects of the EA, providing  they do not exceed the 
powers conferred  on them by the  law or which the  law allows to be conferred 
on it. 

However, Member States may provide that the EA shall not be bound where such 
acts are outside the objects of the EA,  if it proves that the third party 
knew that the act was outside those objects or could  not  in view of the 
circumstances have been unaware of  it; disclosure of the statutes shall not 
of  itself be sufficient proof thereof. 

2-Z. 

4. The appointment, termination of office and particulars of the persons who 
may represent  an EA must be disclosed  in accordance with Article  7. The 
information disclosed must state whether these persons are authorized  to bind 
the EA individually or whether they must  act jointly. 

Article 30 

(Operations requiring  authorization) 

1. The statutes of the EA shall set out the categories of operation  requiring 
an express decision on the part of the executive committee. 

2. A Member State may  lay down the minimum  categories of operation which must 
feature  in the statutes of an EA registered  on its territory. 

Article 31 

(Rights and  obligations) 

1. Within the scope of the functions attributed  to them by this Regulation 
each of the members of the executive committee shall have the same rights and 
obligations as the other members. 

2.  (AMENDMENT No 15) 

All members of the executive committee shall carry out their functions in 

the interests of the EA and  in pursuit of its objectives. 

3. All members of the executive committee shall exercise a proper discretion, 
even after they have ceased to hold office, in respect of information of a 
confidential  nature concerning  the EA. 

Article 32 

(Conduct of business  in the executive  committee) 

1. The executive committee shall conduct business under the conditions and in 
the manner  set out  in the statutes of the EA. 

Where these statutes are silent, the executive committee  shall not  conduct 
business validly unless  its members were properly  convened  at  least  three 
weeks  in advance, and at least one third of  its members are present  at the 
discussions. The notice convening  the meeting may  indicate an alternative 
date on which a meeting  is to be held  if the quorum  is not reached  on the 
first date  indicated. Decisions  shall be taken by majority  of the members 
present or represented. 

2. The chairman  shall have a casting vote  in the event of a tie. 

Article 33 

(Civil  liability) 

1. Members of the executive committee  shall  be  liable  for  loss or damage 
sustained  by the EA as a result of breach of the obligations  attaching  to 
their  functions. 

2. (AMENDMENT No 16) 

Z2> 

Where the executive committee is composed of more than one member, ail the 
members shall be jointly and severally liable for loss or damage sustained by 
the EA. However, each member of the EA's -executive committee shall be 
personally liable for loss or damage sustained by the association where 
proven to be in breach of the obligations attaching to his functions. 

Article 34 

(Proceedings on behalf of the EA) 

1. The general meeting, by a majority of the votes cast, shall take the 
decision to initiate proceedings, in the name and on behalf of the EA, to 
establish liability pursuant to Article 33 (1). 

The general meeting shall appoint a special representative to .conduct the 
action. 

2. Not less than one fifth of the members may likewise decide to initiate 
proceedings to establish liability in the name and on behalf of the EA. They 
shall appoint a special representative to conduct the action. 

Article 35 

(Limitation of actions) 

No proceedings on the EA's behalf to establish liability may be initiated 
more than five years after the act giving rise to loss or damage. 

Chapter  IV 

Annual accounts, consolidated accounts, auditing, means of financing and 
disclosure 

Article 36 

(Budget estimates) 

The EA shall draw up budget estimates for the forthcoming financial year. 

Article 37 

(Preparation of annual accounts and consolidated accounts) 

1. For the purposes of drawing up its annual accounts and its consolidated 
accounts if any, including the annual report accompanying them and their 
auditing and publication, the EA shall be subject to the measures adopted in 
the State in which it has its registered office pursuant to Directives 
78/660/EEC and 83/349/EEC. 

2. The EA may draw up its annual accounts, and its consolidated accounts if 
any, in ecus. In this event the bases of conversion used to express in ecus 
those items included in the accounts which are or were originally expressed 
in another currency must be disclosed in the notes to the accounts. 

4) 

zy 

Article 38 

(Auditing) 

The annual accounts of the EA, and its consolidated  accounts if any, shall be 
audited by one or more persons authorized  to do so in the Member State in 
which the BA has its registered office in accordance with the measures 
adopted  in that State pursuant to Directives 84/253/EEC and 89/48/EEC. Those 
persons shall also verify that the annual report  is consistent with the 
annual accounts, and the consolidated  accounts if any,  for the same  financial 
year. 

Article 39 

(Disclosure of accounts) 

1. The annual accounts, the consolidated  accounts if any, duly approved, and 
the annual report and audit report  shall be disclosed  in the manner provided 
for by the law of the Member State in which the EA has its registered office, 
in accordance with Article 3 of Directive  68/151/EEC. 

2. Where EAs are not subject, under the law of the Member State in which the 
EA has its registered office, to a disclosure requirement  as provided  for in 
Article 3 of Directive 68/151/EEC, the EA must at least make the accounting 
documents available to the public at  its registered office. Copies of these 
documents must be obtainable on request. The price charged  for these copies 
must  not exceed the administrative  cost. 

Article 40 

(Audit) 

The statutes shall  lay down the form of audit of the accounts and  supervision 
of the EA. The auditors shall report on their activities each year to the 
general meeting. 

Article 41 

(Financing) 

(AMENDMENT No 20, modified) 

An EA may avail  itself of all  forms of  financing under the most  favourable 
conditions applying to associations  in the State in which  it has its 
registered office and  in the Member States  in which  it has its 
establishments. 

Chapter  V 

. 

Winding  up 

Article 42 

(Winding up by the general meeting) 

1. An EA may be wound up by a decision of the general meeting ordering  its 
winding up, taken  in accordance with the rules  laid down  in Article 19. 

z s 

However, the general meeting may decide,  in accordance with the same rules, 
to annul the decision to wind up, as long as there has been no distribution 
on the basis of the  liquidation. 

2. The executive committee must  convene a general meeting  to take a decision 
on the winding up of the EA: 

2G 

- where the period  fixed  in the statutes has expired, 

-  where the disclosure of accounts has not taken place in the EA's  last three 
financial years, 

- where the number of members  is below the minimum  required  by this 
Regulation or by the EA's statutes, 

- on any grounds  laid down either in the law relating to the legal  entities 
set out  in the Annex of the State in which the EA has its registered  office 
or  in the statutes. 

The general meeting shall decide: 

- either to wind up the EA in accordance with Article 18, 

- or, in accordance with 'the procedures for amending the statutes, that  the 
EA shall continue its activities. 

Article 43 

(Winding up by the court) 

On an application by any person concerned or any competent  authority, the 
court of the place where the EA has its registered office must order  it to be 
wound up where it finds that the registered  office has been transferred 
outside the Community,  or that the EA's activities are being carried on 
contrary to public policy  in the Member State in which the EA has its 
registered office or in breach of Articles  1 and 3 (1). 

The court may grant the EA a period of time to rectify the situation. If it 
fails to do so within the time allowed the court  shall order  it to be wound 
up. 

Chapter  VI 

Liquidation 

Article 44 

(Liquidation) 

1. The winding up of an EA shall entail  its liquidation. 

2. The  liquidation of an EA and the conclusion of its liquidation  shall be 
governed by the law applicable to the legal entities set out  in the Annex of 
the State in which it has its registered office. 

3. After the creditors have been paid  in full, the net assets shall be 
distributed  in accordance with the law applying to the EA  in the State in 
which  it has its registered  office unless otherwise stipulated  in the 
statutes. 

4. An EA  in liquidation shall continue to have  legal personality  until the 
conclusion of the liquidation. 

5. Following the liquidation, the books and  records relating  to the 
liquidation shall be lodged at the register  referred  to in Article 7  (3). Any 
interested  party may examine such books and records. 

2} 

Chapter  VII 

Insolvency and suspension of payments 

Article 45 

(Insolvency and suspension of payments) 

1. The EA shall be subject to the law of the State  in which  it has its 
registered office in respect of insolvency  and suspension of payments. 

2. The opening of  insolvency or suspension of payments proceedings shall be 
notified by the person appointed to conduct the proceedings,  for entry  in the 
register. The entry  in the register shall show the  following: 

(a) the nature of the proceedings, the date of the order, and the court 
making it; 

(b) the date on which payments were suspended,  if the court order  provides 
for this; 

(c) the name and address of the person having power to conduct  the 
proceedings, or of each of them where there are more than one; 

(d) any other  information considered  necessary. 

3. The court  shall, either of  its own motion or on application by any 
interested  party, order  its decision to be noted  in the register referred to 
in Article 7 (3). 

4. Particulars registered pursuant to paragraphs 2 and 3 shall be published 
in the manner referred  to in Article 8. 

TITLE  II 

FINAL  PROVISIONS 

Article 46 

(Measures to be applied  in the event of a breach of  rules) 

Each Member State shall specify the appropriate measures to be imposed in the 
case of breach of the provisions of this Regulation  and, where appropriate, 
of any relevant  national measures; the penalties must be effective, 
proportionate and dissuasive. 

Each Member State shall take the necessary measures before  1 January  1994 and 
shall  forthwith  inform the Commission thereof. 

Article 47 

This Regulation shall enter  into force on 1 January 1994. 

This Regulation  shall be binding in its entirety  and directly applicable in 
all Member States. 

2f 

Done at Brussels, 

For the Council 

The  President 

2-9 

Legal entities mentioned in Article 3 

- In Belgium 

Not-for-profit associations and organizations recognized 4s being of public 
benefit coming under the Law of 25 October 1919 and the Law of 27 June 1921 

- In Denmark 

Associations and foundations coming under the Law of 6 June 1984 

- In Spain 

Associations and foundations coming under, respectively, the Law of 24 
December 1964 and under Articles 35 and following of the Civil Code 

- In France 

Not-for-profit associations coming under the Law of 1 July 1901 and paragraph 
4 of Articles 21 to 79 of the Local Civil Code of Alsace and Moselle, and 
foundations coming under the Law of 23 July 1987, modified by the Law of 4 
July 1990. 

- In Greece 

Associations and foundations coming under Article 78 of the Greek Civil Code 

- In Ireland 

Companies limited by guarantee, organizations incorporated by Royal Charter 
or Act of Parliament, industrial and provident societies or friendly 
societies 

- In Italy 

Associations and foundations coming under Articles 14 to 35 of the Italian 
Civil Code 

- In Luxembourg 

Not-for-profit associations and organizations recognized as of public benefit 
coming under the Law of 21 April 1928 

- In the Netherlands 

Associations and foundations coming under, respectively, Section II and 
Articles 286 to 304 of the Civil Code 

- In Portugal 

Associations and foundations coming under Articles 167 to 194 of the. Civil 

Code 

-  In Germany 

3o 

Associations  and  foundations coming under Articles 21 to 88 of the Civil Code 
(BGB) 

(AMENDMENT No 22) 

-  In the United Kingdom 

Companies  limited by guarantee, organizations  incorporated  by Royal Charter 
or Act of Parliament,  industrial and provident  societies or  friendly 
societies, unincorporated  associations or organisations  and all  institutions 
established  for exclusively charitable purposes 

Amended proposal for a Council Directive supplementing the statute for a European 
association with regard to the involvement of employees 

31 

THE  COUNCIL  OF  THE  EUROPEAN  COMMUNITIES, 

SYN 387 

Having regard to the Treaty establishing  the European Economic Community, and 
in particular Article 54 thereof, 

Having regard to the proposal  from the Commission, 

In cooperation with the European Parliament, 

Having regard to the opinion of the Economic  and Social Committee, 

Whereas in order to attain the objectives  set out  in Article 8a of the 
Treaty, Regulation  (EEC) No  . . . (!)  establishes a Statute for a European 
association (EA); 

Whereas there are in the Member States  laws, regulations and  administrative 
provisions concerning the provision of  information to and the consultation of 
the employees of undertakings, whatever their  legal  form; whereas in some 
Member States, there are provisions concerning the participation of employees 
in certain legal entities; 

Whereas it is desirable to coordinate  information and  consultation 
arrangements at Community  level in order to develop dialogue between the 
executive committee of EAs and employees; 

Whereas the realization of the internal market  is giving  rise to a process of 
concentration and conversion of associations; whereas  in order to ensure a 
harmonious development of economic activities, EAs carrying on crossborder 
activities must adopt, if appropriate, a participation model, or, failing 
this,  inform and consult employees on decisions which concern them; 

Whereas this Directive determines the minimum areas where there must be 
information and consultation, without prejudice to the application of the 
following Directives: 

- Council Directive  75/129/EEC of  17 February  1975 on the approximation of 
the laws of the Member States relating to collective  redundancies(2), as 
amended by Directive  . . ./.  .  ./EEC^3), 

- Council Directive 77/187/EEC of  14 February  1977 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 
businesses(4), and 

- Council Directive  . . ./EEC on the establishment  of a European Works 
Council  in Community-scale undertakings or groups of undertakings  for the 
purposes of informing  and consulting  employees^5); 

(1) OJ No L 
(2) OJ No L 48, 22.2.1975, p. 29 
(3) COM(91) 292  final, 15.7.1991 
(4) OJ No L 61,  5.3.1977, p. 26. 
(5) COM(90) 581 final. 

(AMENDMENT No 25) 

5Z 

Whereas appropriate provisions must  be adopted  to ensure that the employees 
of EAs are properly  informed and consulted without  undue delay where 
decisions  likely to affect their  interests or which have a potential  impact 
on the prospects of the EA and the conditions of employment  are taken  in a 
Member State other than that  in which they are  employed; 

Whereas the laws, regulations and administrative  provisions of the Member 
States governing  the participation of employees  in certain national  legal 
entities may be made applicable to EAs; 

Whereas an EA may not be registered  until a participation model or, in the 
absence thereof, an employee  information  and consultation  system and in 
particular  a separate committee  has been chosen; 

Whereas the natural persons who  founded  the EA or, where no agreement  is 
reached prior to registration of the EA, the founder entities should  propose 
to the general meeting  called to approve the  formation of the EA certain 
requirements with respect  to informing  and consulting  employees; 

Whereas the information  and consultation  committee  or any other  alternative 
body must be informed  and consulted  about decisions on the part of the EA 
capable of affecting  employees'  interests; 

Whereas  in order to ensure the proper  functioning of the internal market  and 
avoid any  inequality  in the terms of competition,  the employees of the EA 
should be guaranteed  equivalent  levels of information  and  consultation; 

Whereas  in order to allow  for more  flexibility with respect  to small EAs, 
Member  States need not provide for employee  representation  in EAs employing 
fewer than 50 workers; 

Whereas the provisions of this Directive  form an  indissociable  supplement  to 
those of Regulation  (EEC) No  . . . [on the Statute  for a European 
association]; whereas  it is therefore necessary  to ensure that the two sets 
of provisions are applied  concomitantly, 

HAS  ADOPTED  THIS  DIRECTIVE: 

Article 1 

This Directive  coordinates the  laws, regulations and  administrative 
provisions of the Member  States concerning  the  involvement  of employees  in 
the EA. 

This Directive  is an essential  supplement  to Regulation  (EEC) No  . . . (on 
the Statute  for a European association]. 

No EA'may be registered  until a participation model or,  in the absence 
thereof,  an information  and consultation  system  has been chosen  in accordance 
with the provisions of this Directive. 

33 

TITLE  I 

Part ic ipation 

Article 2 

The  laws, regulations and administrative provisions of a Member State 
governing the participation of employees  in the supervisory or  administrative 
boards of national companies may be made applicable to an EA whose  registered 
office is in its territory. 

Where such provisions are not applied the Member State shall take the 
necessary measures to ensure at least that the employees of the EA are 
informed and consulted in accordance with Articles 3, 4 and 5. 

TITLE  II 

Information and consultation  arrangements 

Article 3 

1. The executive committees of the founder entities and the  representatives 
of the employees of those entities provided  for by the laws and practices of 
the Member States shall agree arrangements  for informing  and consulting the 
employees of the EA. The agreement must be concluded  in writing before the EA 
is registered. 

2. Where the EA is formed solely by natural persons, those persons shall lay 
down information and consultation procedures on the basis of the requirements 
with respect to informing and consulting employees set out  in Article 4 (1); 
those procedures must be submitted to the general meeting called to approve 
the formation of the EA. 

3. Where in the circumstances described  in paragraph  1 no agreement can be 
reached, the representatives of the employees of the founder entities may 
make a written statement setting out why  in their opinion the formation of 
the EA is contrary to the employees' interests and what measures should be 
taken with respect to the employees. 

4. The executive committees of the founder entities shall draw up for 
submission to the general meeting called to approve the formation of the EA a 
report to which  is attached either: 

- the text of the agreement  referred  to in paragraph  1, or 

- the statement by the employees' representatives  referred  to in paragraph 3. 

5. The general meeting called  to approve the formation of the EA shall ratify 
the information and consultation arrangements embodied  in the agreement 
referred  to in paragraph  1, or, where no agreement  has been reached, shall 
decide on the arrangements which are to apply to the EA  in the  light of the 
report and of the statement  referred  to in paragraphs  3 and 4. 

3^ 

6. The arrangements chosen may subsequently  be replaced by other arrangements 
agreed between the EA's executive committee and the representatives of the 
employees of the EA. The agreement must be submitted to the general meeting 
for approval. 

7. The procedure  laid down in this Article shall apply  in the event of 
conversion pursuant to Article 3  (2) of the Regulation  (EEC) . . ./.  . (on 
the Statute for a European association]. 

(AMENDMENT No 37, modified) 

8. In the event of the registered  office of a EA being transferred to another 
Member State, the information and/or consultation arrangements in existence 
before the transfer may be altered only by agreement between the executive 
committee of the EA and the representatives of  its employees. 

Article 4 

1. The executive committee of the EA shall inform and consult  in good time 
the employees of that entity at  least in the following areas: 

(AMENDMENT No 39) 

(a) any proposals which might significantly affect the interests of the 
employees of the EA, or which have a potential  impact on the prospects of the 
EA and the conditions of employment  and especially all matters concerning 
working conditions and all decisions requiring the approval of the executive 
committee, without prejudice to the Community provisions concerning 
information and consultation, and  in particular Directives 75/129/EEC, 
77/187/EEC and  . . ./EEC (on the establishment  of a European Works Council]; 

(b) any question concerning conditions of employment, in particular changes 
affecting the organization of the EA and the introduction of new working 
methods or new products and/or services; 

(c) all documents submitted  to the EA's general meeting; 

(d) the operations referred to in Article 30  (1) of the Regulation  (EEC) 
.  . . (on the Statute  for a European  association]; 

(AMENDMENT No 40) 

(e) the development  and organization of vocational training  undertaken  in the 
EA and any matter affecting the health and safety of employees, with equal 
and  joint participation  in the development  of health and  safety programmes 
and policies  in the EA. 

2. The employees of the EA shall be  informed  and  consulted: 

- within  a separate committee representing  the employees of the EA, or 

- within any other  structure agreed  between the executive committees of the 
founder entities and the representatives of the employees of those entities. 

A Member State may  restrict  this range of  information  and  participation 
arrangements  in the case of EAs having  their  registered  head office  in its 
territory. 

3. In an EA with  fewer than 50 employees the two parties to the negotiations 
may decide that simplified  information  and consultation  arrangements should 

be laid down, subject to compliance with paragraph 1 

3S 

Article 5 

3C 

1. The representatives of the employees of the EA shall be elected,  and shall 
be provided with  such  facilities as are necessary  to enable them to perform 
their duties properly,  in accordance with the laws and practices of the 
Member  States and  in compliance with the following  principles: 

(a) employees' representatives must be elected  in each Member  State in which 
the EA has establishments; 

(b) the number  of representatives  so elected must  as far as possible be in 
proportion  to the number of employees they  represent; 

(c) all employees must be able to participate  in the vote irrespective of 
their  length of service or the number of hours they work per week; 

(d) the election must be by secret ballot. 

2. The employees' representatives elected  in accordance with paragraph  1 may 
perform their  functions within the EA irrespective of the rules governing 
qualification as an employees' representative  in the law of the Member  State 
in which the EA has its registered  office. 

(AMENDMENT No 43) 

The elected  representatives may carry out their duties during working hours. 
No disciplinary  measures may be taken against  them  in relation to actions 
connected with the performance of their duties. They may not be routinely 
dismissed  during  their period of office. 

TITLE III 

Final provisions 

Article 6 

1. Member  States shall bring  into force the laws, regulations and 
administrative  provisions necessary  to comply with this Directive before 1 
January  1994. They  shall  immediately  inform  the Commission  thereof. 

When Member  States adopt these provisions, these shall contain a reference to 
this Directive or shall be accompanied  by such reference at the time of their 
official  publication. The procedure  for such reference  shall be adopted by 
Member  States. 

2. Member  States shall communicate  to the Commission  the main provisions of 
national  law which  they adopt  in the  field  covered  by this Directive. 

i 

Article 7 

This Directive  is addressed  to the Member States. 

Done at Brussels, 

For the Council 

3 9 

Amended  proposal  for a 
COUNCIL REGULATION  (EEC) 

SYN 388 

on  the Statute for a European cooperative society 

THE  COUNCIL  OF  THE  EUROPEAN  COMMUNITIES, 

Having  regard to the Treaty establishing  the European Economic Community, and 
in particular Article 100a thereof, 

Having regard to the proposal  from the Commission, 

In cooperation with the European  Parliament, 

Having regard  to the opinion of the Economic  and Social  Committee, 

Whereas the European Parliament  adopted  resolutions on  13 April  1983 on 
cooperatives  in the European Community(*) and on 9 July  1987 on the 
contribution of cooperatives to regional  development(2); 

Whereas the Commission  adopted  a communication  to the Council of  18 December 
1989(3); whereas the Economic  and Social Committee  gave  its opinion on that 
communication  on  19 September  1990(4); 

Whereas the completion of the internal market means that  there must be full 
freedom of establishment  for all activities which contribute to the 
objectives of the Community,  irrespective of the form taken by the body which 
carries them on; 

Whereas, therefore, the Community,  which  is concerned  to respect equal terms 
of competition  and to contribute to its economic development,  should provide 
cooperatives, which are a form of organization generally  recognized  in all 
Member  States, with adequate  legal  instruments capable of  facilitating the 
development of their transnational  activities; 

Whereas by attainment  of their objectives and the form of their  operations 
cooperatives  play a full part  in the  life of the economy; 

Whereas the Statute for a European company,  as provided  for  in Regulation 
(EEC) No  . .  .(^),  is not an  instrument  which  is suited  to the  specific 
features of cooperatives; 

Whereas the European Economic  Interest Grouping  (EEIG),  as provided  for in 
Council Regulation  (EEC) No 2137/85(6),  does allow undertakings to promote 
certain of their activities  in common,  while  nevertheless preserving  their 
independence, but  it does not meet  the specific  requirements of  cooperative 
enterprise; 

(AMENDMENT  No 46) 

Whereas cooperatives are primarily  groups of persons with  particular 
operating  principles which are different  from those of other economic agents; 
(1)  OJ No C 128, 16.5.1983, p. 51. 
(2)  OJ No C 246, 14.9.1987, p. 94. 
(3)  Businesses  in the  'économie sociale' sector - Europe's  frontier-free 

market: SEC(89) 2187 final,  18.12.1989. 

(4)  OJ No C 332, 31.12.1990, p. 81. 
(5)  OJ No L 
(6)  OJ No L 199, 31.7.1985, p. 1. 

3tf 
Whereas these particular principles  notably  include the principle of the 
primacy of the individual which  is reflected  in the specific  rules on 
membership,  resignation  and expulsion, where the "one man, one vote" rule is 
laid down and the right to vote is vested  in the individual, with the 
implication  that members cannot exercise any rights over the assets of the 
cooperative; 

Whereas cross-border  cooperation between  cooperatives  in the Community  is 
currently  hampered  by legal and administrative  difficulties which should be 
eliminated  in a market without  frontiers; 

Whereas the introduction of a European  form of organization which would be 
available to cooperatives, based on common  principles but taking account of 
their  specific  features, should enable them to operate outside their own 
national borders  in all or part of the territory  of the  Community; 

(AMENDMENT No 47) 

Whereas the essential aim of the legal rules governing the European 
cooperative  society  (hereinafter  referred to as the SCE) implies that  an SCE 
may be set up by  legal entities or persons established  under the laws of 
different Member  States, or by transformation  of a national cooperative  into 
the new form  without  first being wound up, so long as the cooperative has 
its registered  office and central  administration  in the Community  and an 
establishment  or subsidiary  in a Member  State other than that  in which  it has 
its central administration;  in this  last case, the cooperative must  engage in 
genuine and effective cross-border  activity; 

Whereas  cooperatives have a share capital, and may have among their members 
some who are also customers or suppliers; whereas cooperatives may also have 
among their members  a specified  proportion  Of members who do not use their 
services, or of third parties who benefit  by their activities or carry out 
work  for the cooperative's account; 

Whereas the rules on accounting  are intended  to ensure more effective 
management  and to forestall any possible difficulty; 

Whereas, on matters not covered  by this Regulation, the provisions of the law 
of the Member  States and of Community  law are applicable, for example with 
regard  to: 

-  rules on employee  involvement  in the decision-making  process, 

- employment  law, 

-  taxation  law, 

- competition  law, 

-  intellectual  and  industrial  property  law, 

-  rules on  insolvency  and  suspension of payments; 

Whereas the application of this Regulation must be deferred  so as to enable 
each Member State to incorporate  into its national  law the provisions of the 
Council  Directive supplementing  the Statute  for a European  cooperative 
society with  regard to the  involvement of employeesC) and to put  in place 
in advance the necessary machinery  for securing  the formation and  operation 
of SCEs having  their registered  office  in its territory, so that the 
Regulation  and the Directive may be applied  concomitantly; 
(7)  OJ No  h 

- 3J-

Whereas work on the approximation of national company  law has made 
substantial progress so that reference may be made to certain dispositions 
made by the Member State where the SCE has its registered office  for the 
purpose of  implementing directives on companies, by analogy  for the SCE in 
areas where the functioning of the cooperative does not require uniform 
Community  rules, such dispositions being appropriate to the  arrangements 
governing  the SCE; 

- Council Directive 68/151/EEC of 9 March  1968 on coordination of  safeguards 
which, for the protection of the interests of members and others, are 
required by Member States of companies within the meaning of the second 
paragraph of Article 58 of the Treaty, with a view to making  such  safeguards 
equivalent throughout the Community^®), as last amended by the Act of 
Accession of Spain and Portugal, 

- 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('), as last 
amended by Directives 90/604/EEC<10) and  90/605/EEC<lx), 

- Council Directive 83/349/EEC of 13 June 1983 based on Article 54  (3) (g) of 
the Treaty on consolidated  accounts(12)f  as  ia st amended by Directives 
90/604/EEC and 90/605/EEC, 

- Council Directive 84/253/EEC of 10 April 1984 based on Article 54  (3) (g) 
of the Treaty on the approval of persons responsible  for carrying out the 
statutory audits of accounting  documents(1^), 

- Council Directive 89/48/EEC of 21 December  1988 on a general  system  for the 
recognition of higher-education  diplomas awarded on completion of 
professional education and training of at least three years'  duration(14), 

- Council  Directive 89/666/EEC of 21 December  1989 concerning  disclosure 
requirements  in respect of branches opened  in a Member State by certain types 
of company governed by the law of another  State(15); 

Whereas the activities in the field of financial services and notably  as they 
concern credit establishments and insurance enterprises have been the subject 
of  legislative measures pursuant to the following Directives: 

- Council Directive 86/635/EEC of 8 December  1986 on the annual accounts and 
consolidated  accounts of banks and other financial  institutions(1^), 

- Council Directive 89/646/EEC of 15 December  1989 on the coordination of 
laws, regulations and administrative provisions relating to the taking up and 
pursuit of the business of credit  institutions and amending Directive 
77/780/EEc(17); 

(8)  OJ No L 65, 14.3.1968, p. 8 
(9)  OJ No L 222, 14.8.1978, p. 
(10) OJ No L 317, 16.11.1990, p. 
(11) OJ No L 317, 16.11.1990, p. 
(12) OJ No L 126, 12.5.1984, p. 
(13) OJ No L 126, 12.5.1984, p. 
(14) OJ No L 19, 24.1.1989, p. 1 
(15) OJ No L 395, 30.12.1989, p. 
(16) OJ No L 372, 31.12.1986, p. 
(17) OJ No L 386, 30.12.1989, p. 

Wo 
- council Directive  . . / . ..  /EEC on the coordination of  laws, regulations 
and administrative provisions relating  to direct  insurance other than life 
insurance and amending Directives 73/239/EEC and  88/357/EEC(1Q); 

Whereas  it must be possible to form an SCE either with at least five natural 
persons resident  in at least two Member States; or at least five natural 
persons and at least one legal entity; or at least two legal entities of a 
cooperative nature; 

Whereas this form of organization  should be optional, 

HAS  ADOPTED  THIS  REGULATION: 

TITLE  I 

GENERAL  PROVISIONS 

CHAPTER  I 

FORMATION  OF  THE  EUROPEAN  COOPERATIVE  SOCIETY 

Article 1 

(Form of the European cooperative  society) 

1. Cooperative  societies may be formed throughout  the Community  in the form 
of a European cooperative society  (SCE) on the conditions and  in the manner 
set out  in this Regulation. 

2. The capital of the SCE shall be divided  into shares. 

3. The SCE shall have as its object to satisfy  its members' needs and to 
develop their activities, economic, social or both. 

4. The number of members and the capital of the SCE shall be variable. 

5. The  liability of the members  for the debts and obligations of the SCE 
shall be limited  to their shares  in the capital. Its statutes may extend  this 
liability  to a multiple of the capital  subscribed  or to another  stated 
amount. 

6. An SCE may not extend the benefits of  its activities to non'members or 
allow them to participate  in its business, except where  its statutes provide 
otherwise. 

7. An SCE shall have legal personality.  It shall acquire  it on the day of its 
registration  in the Member State  in which  it has its registered  office, in 
the register designated  by that State  in accordance with Article  5 (3). 

Article 2 

(Registered  office) 

The registered  office of an SCE shall be situated within the Community  in the 
Member State  in which the SCE has  its central  administration. 

(18) COM(90) 348 final - SYN 291 

Article 3 

(Transfer of registered  office) 

1. The registered office of an SCE may be transferred  to another Member State 
in accordance with paragraphs 2 to 9 below.  Such transfer  shall not result 
in the SCE being wound up or in the creation of a new  legal person. 

2. A transfer proposal  shall be drawn up by the management or  administrative 
board and be published  in accordance with Article 6, without prejudice to any 
additional  form of publicity provided  for by the Member State  in which the 
registered  office is situated.  This proposal shall  include details of: 

a)  the registered office proposed  for the SCE, 
b)  the statutes proposed  for the SCE including, where appropriate, its new 

title, 

c)  the timetable proposed  for the transfer. 

2(a) The management or administrative board  shall draw up a report explaining 
and justifying the legal and economic aspects of the transfer  for the 
attention of members and workers. 

2(b) The members and creditors of the SCE shall, at least one month prior to 
the general meeting called to decide on the transfer, have the right to 
examine, at the registered office of the SCE, the transfer proposal and the 
report drawn up by virtue of 2(a) and to obtain copies of these documents 
free of charge on request. 

2(c) A Member State may, in respect of SCEs registered  on  its territory, 
adopt provisions to ensure appropriate protection  for members  in the minority 
who voted  against the transfer. 

3. No decision to transfer may be taken  for two months after publication of 
the proposal.  Any such decision must be governed by the conditions  laid down 
for the amendment of the statutes. 

4. The creditors and holders of other rights vis-à-vis the SCE which predated 
publication of the transfer proposal may  require the SCE to constitute an 
appropriate guarantee  in their  favour.  Exercise of this right shall be 
governed by national  law in the State  in which the SCE had  its registered 
office prior to transfer. 

A Member State may extend  the application of the above provision to  include 
debts made by the SCE with public entities prior to the date of transfer. 

5. In the Member State  in which the SCE has  its registered office, a court, 
notary or other competent authority  shall  issue a certificate to the effect 
that the acts and  formalities required prior to transfer  have been properly 
completed. 

6. The new registration may  not be effected  until the certificate  provided 
for in  (5) has been produced  and evidence has been  furnished  of completion of 
the  formalities  required  for registration  in the country  of the SCE's new 
registered office. 

6(a) Transfer of the SCE's registered  office and the resulting  change of 
statutes shall take effect on the date on which  the SCE  is registered  in the 
register  for its new registered office, in accordance with Article 5(3). 

M* 

7. The removal of the SCE from the register  for its previous  registered 
office may not be effected until evidence has been produced that the SCE has 
been registered  in the register  for its new registered office. 

8. The fact of the new registration and the fact of the removal of the old 
registration shall both be published  in the Member States concerned, in 
accordance with Article 6. 

9. The new registration of the registered office of the SCE may be relied on 
as against third parties from publication.  However, until the removal of the 
SCE  from the register  for its previous registered office has been published 
third parties may continue to rely on the old registered office unless the 
SCE proves that such third parties were aware of the new registered office. 

10. A Member State's legislation may, in respect of SCEs registered  in that 
country, provide for any transfer of registered  office giving  rise to a 
change in the applicable  law not to take effect where, within the period of 
two months specified  in  (3), a competent  authority  from that country  lodges 
an objection.  Such objection may only be lodged  for reasons of public 
interest.  It must be possible to appeal against any such ruling to a 
judicial body. 

11. An SCE which  is the subject of winding-up, liquidation,  insolvency, 
suspension of payments or other such procedures may not transfer  its 
registered office. 

Article 4 

(Applicable  law) 

1. SCEs shall be governed: 

(AMENDMENT  No 49, aligned with European Company  terms) 

(a)  - by the provisions of this Regulation, 

(b)  - where expressly  authorized  by this Regulation, by the provisions in 

the statutes of the SCE; 

(c)  - for matters not dealt with by this Regulation or, where a matter  is 

dealt with only partially,  for the aspects not covered  by this 
Regulation: 

- by the legal provisions adopted by the Member States  in application 
of Community measures dealing  specifically with  SCEs; 
- by the legal provisions  in Member States applying  to a cooperative 
in conformity  with the legislation of the Member State  in which the 
SCE has its registered office; 
- by the provisions of rules under the same conditions as for a 
cooperative constituted  in accordance with the  legislation of the 
Member State  in which the SCE has its registered office. 

2.  (AMENDMENT No 50, aligned with European Company) 

Where a Member  State comprises several  territorial  units, each of which has 

its own rules of  law applicable to the matters referred  to in paragraph  1, 
each  territorial  unit  shall be considered  a Member  State  for the purposes of 
identifying  the  law applicable  under this paragraph. 

3. In each Member State and subject  to the express provisions of this 
regulation, an SCE shall  have the same rights, powers and obligations  as a 

cooperative  society  formed under the law or tne auatc 
its registered office. 

zr 

j  „,*«,- t-ho  law  of  t he  S t a te  in  w h i ch  t he  S CE  h as 

73 

Wq 

Article 5 

(Registration and disclosure  requirements) 

1. The founder members shall draw up the statutes of the SCE in accordance 
with the provisions for the formation of cooperative societies  laid down by 
the law of the State in which the SCE has  its registered  office. The statutes 
must at least be in writing and signed by the founder members. 

2.  In those Member States whose  legislation does not provide  for any 
precautionary  supervision, whether administrative or judicial, at the time of 
formation, the statutes shall be adopted  by notarial  act. The supervisory 
authority  shall ensure that this act complies with the requirements  for the 
formation of an SCE, and in particular those set out  in Articles  1, 2, 9 and 
10. 

3. Member States shall designate the register  in which SCEs must be 
registered  and shall determine the rules governing  it. They  shall  lay down 
the procedures  for filing the SCE's statutes. No SCE may be registered  until 
the measures required by the Directive  (supplementing  the Statute for a 
European cooperative society with regard to the involvement of employees] 
have been, adopted. 

4. Member States shall take the measures required  to ensure that the 
following documents and particulars are disclosed  as provided  for in 
paragraph 3: 

(a) the statutes of the SCE, any amendments to them, and the complete text of 
the statutes in its up-to-date  form; 

(b) the opening or closing of any establishment; 

(c) the appointment, termination of office and particulars of the persons who 
either as a body constituted  pursuant to law or as members of any such body: 

(AMENDMENT No 51) 

-  are authorized  to represent  the SCE, individually  or  jointly,  in dealings 
with third parties and  in legal proceedings, 

-  take part in the administration, supervision or control of the SCE; 

(d) at least once a year, the amount of the capital  subscribed; 

(e) the balance sheet and the profit  and  loss account  for each  financial 
year; the document containing the balance sheet  shall give particulars of the 
persons who are required  by  law to certify it; 

(f) any proposal to transfer  the registered  office as referred  to in Article 
3 (2); 

(g) the winding up and  liquidation of the SCE and the decision to continue 
the SCE's activities taken under Article 61; 

(h) any declaration of nullity of the SCE by a court; 

(i) the appointment of liquidators, particulars of such liquidators and their 
respective powers, the termination of their office; 

(j) the conclusion of the liquidation of the SCE and the removal of the SCE 
from the register. 

5. If, prior to its acquisition of legal personality, steps have been taken 
in the name of an SCE and the SCE does not assume the obligations arising 
from those steps, the persons who took them  shall be jointly  and  severally 
liable therefor, unless otherwise agreed. 

Article 6 

(Publication of documents and particulars relating to the SCE in the Member 
States) 

1. Member States shall ensure that the documents and particulars referred to 
in Article 5  (4) are published  in the appropriate official gazette in the 
Member State in which the SCE has its registered office, and shall determine 
by which persons the disclosure  formalities are to be carried out. Disclosure 
shall be effected by publication either of an extract or of a reference to 
the entry  in the register. 

Member States shall also ensure that anyone may consult the documents 
referred to in Article 5 (4) in the register  referred to in Article 5 (3), 
and may obtain a copy of the whole or any part, by post  if requested. 

Member States shall take the necessary measures to avoid any  discrepancy 
between what  is disclosed by publication  and what appears  in the register. 
However, in cases of discrepancy, the text published may not be relied on as 
against third parties; the latter may nevertheless rely thereon, unless the 
SCE proves that they had knowledge of the text entered  in the register. 

Member States may  require payment of a fee for the services referred  to in 
the preceding  subparagraphs, but the fee may  not exceed the  administrative 
cost. 

2. The national rules adopted pursuant  to Directive 89/666/EEC  shall apply to 
branches of an SCE opened  in a Member State other than that  in which  it has 
its registered office. 

3. Documents and particulars may be relied on by the SCE as against third 
parties only after they have been disclosed  in accordance with paragraph 1, 
unless the SCE proves that the third party had knowledge thereof. However, 
they may not be relied on in respect of transactions which take place before 
the  16th day after publication  as against third parties who prove that they 
could  not have had knowledge thereof. 

4. Third  parties may  rely on any documents and particulars  in respect of 
which the disclosure  formalities have not yet been completed,  save where non 
disclosure causes them not to have effect. 

Article 7 

(Notice in the Official  Journal) 

M6 

Member  States shall ensure that  a notice stating that  an SCE has been 
registered  or that  the liquidation  of an SCE has been concluded  is published 
for  information  purposes  in the Official  Journal of the European  Communities, 
stating the number, date and place of registration of the SCE, the date and 
place of publication  and the title of the publication,  the address of the SCE 
and  a summary  of  its objects, and that  these particulars  are forwarded  to the 
Office  for Official  Publications of the European Communities  within one month 
of the date of the publication  in the official gazette of the Member  State in 
which the SCE has its registered  office under Article  6 (1). 

Where the registered  office of the SCE  is transferred  in accordance with 
Article  3 a notice  shall be published  containing  the  information  provided  for 
in the first paragraph, together with that  relating  to the new  registration. 

Article 8 

(Particulars to be stated  in the SCE's documents) 

Letters and documents  sent to third  parties  shall  state  legibly: 

(a) the name of the SCE, preceded  or followed  by the abbreviation SCE; 

(b) the place of the register  in which the SCE is registered  in accordance 
with Article 5  (3), and the number  of the SCE's entry  in that  register; 

(c) the address of the SCE's registered  office; 

(d) the fact that  the SCE  is in liquidation  or under the administration  of 
the courts  if that  is so. 

Article 9 

(Formation) 

(AMENDMENT  No 53, modified) 

1. An SCE may be formed as follows: 

- by natural  persons only, viz. five or more natural  persons resident in 

at least two different Member States; 

- by  five or more natural persons resident  in at  least  two different 
Member States and one or more  legal entities governed  by public or 
private  law and  formed under the law of a Member State which are 
listed  in the Annex. In this case the statutes  shall determine whether 
the majority  at general meetings must be constituted  by the natural 
persons; 

- by two or more  legal entities  formed  under the  law of a Member  State 
which are listed  in the Annex, having  their registered  office and 
central  administration  in at  least two different Member States. 

2. A cooperative  society which has been  formed  in accordance with the law of 
a Member State and  has its registered  office and central  administration  in 
the Community  may  form an SCE by converting  into SCE  form  if it has, for at 
least two years, had an establishment  or subsidiary  in a Member State other 
than that of  its central  administration, and can demonstrate  that  it is 

carrying on genuine and effective cross-border  activities 

(7) 

72 

Such conversion shall not result  in the society being wound up or  in the 
creation of a new  legal person. 

The administrative or management  board of such a society  shall draw up a 
proposal  for conversion covering the legal and economic aspects of the 
conversion. 

The conversion to SCE form and the SCE's statutes shall be approved by the 
general meeting  in accordance with the requirements  laid down  for amendment 
of  its statutes  in Article 24. 

Article 10 

(The statutes of the SCE) 

1. The statutes of the SCE must include: 

- the name of the SCE, preceded or followed by the abbreviation SCE, 

- a precise statement of the objects of the SCE, 

- the name, objects and registered offices of the founder members of the SCE, 
where these are legal entities, 

- the address of the SCE's registered office, 

- the conditions and procedures for the admission, expulsion and  resignation 
of members, 

- the rights and obligations of members, and the different categories of 
member  if any, and the rights and obligations of members  in each category, 

- the nominal value of the shares and the amount of the capital, an 
indication that the capital  is variable, and the extent of the liability of 
members of governing bodies and officials, 

- the management structure, 

- the powers and responsibilities of each of the governing  bodies of the SCE, 

- provisions governing  the appointment  and removal of the members of the 
governing bodies, 

- the majority  and quorum requirements, 

- a definition of the governing  bodies, or members of those bodies, having 
authority  to represent the SCE  in dealings with third parties, 

- the conditions  for the initiation of proceedings on behalf  of the SCE under 
Article 47, 

-  the reasons  for expelling members, 

-  the grounds  for winding up. 

2. For the purposes of this Regulation  the statutes of the SCE comprise both 
the instrument of  incorporation  and, where they  are set out  in a separate 
document, the SCE's statutes properly  so-called. 

Article 11 

(Acquisition of membership) 

W9 

1. The acquisition of membership  in the SCE shall be subject to the approval 
of the management or administrative board. Applications  for admission shall 
be in writing, and shall include an undertaking  to hold a stake in the 
capital and to accept the statutes without  reservation. 

The statutes may provide that persons who do not expect to use the SCE's 
services may be admitted as investor  (non-user) members. The acquisition of 
such membership shall be subject to approval by the general meeting, to be 
decided  by the majority  required  for amendment of the statutes. 

Members who are legal entities shall be deemed to be users by virtue of the 
fact that they represent their own members. 

2.  In view of the special nature of the relationship between a cooperative 
society and  its members, the statutes may make admission  subject to other 
conditions, in particular: 

-  subscription of a minimum amount to the capital, 

- conditions related to the objects of the SCE. 

3. Except where the statutes provide otherwise, applications  for a 
supplementary  stake in the capital  shall also require the approval of the 
management or administrative board. 

4. An alphabetical  index of all members holding  shares shall be kept at the 
registered  office of the SCE, showing their addresses and the number and 
class, if any, of the shares they hold. Any  interested party may  inspect the 
index on request, and may obtain a copy of the whole or any part at a price 
not exceeding the administrative  cost thereof. 

5. Any transaction which affects the manner  in which the capital  is ascribed 
or allotted, or increased or reduced,  shall be entered  on the index of 
members referred  to in paragraph  4 no later than the month  following that in 
which the change occurs. 

6. The transactions referred  to in paragraph  5 shall not take effect with 
respect to the SCE or third parties until  they are entered  on the  index 
referred  to in paragraph 4. 

7. The holders of the shares affected  shall on request be given a written 
statement  certifying  that the change has been entered. 

Article 12 

(Loss of membership) 

(AMENDMENT No 56) 

1. Membership shall be lost: 

- upon resignation, 

- upon expulsion, where the member  commits a serious breach of his 
obligations, 

-  upon assignment of all shares held, where this is authorized  by the 
statutes, 

So 

- upon winding  up in the case of a member  legal entity, 

- upon death or  insolvency, 

- and  in any other cases provided  for in the statutes. 

2. The decision to expel a member  shall be taken by the administrative or 
management body, after the member has been heard. The member may appeal 
against the decision to the general meeting. 

3. Where a legal entity  is wound up, its membership shall terminate at the 
end of the financial year in which  it took place, unless the statutes provide 
otherwise. 

4. Shares may be assigned or sold with the agreement either of the general 
meeting or of the management or administrative body, and  in accordance with 
the statutes. 

5. The SCE may not subscribe for its own shares, purchase them or accept them 
as security, either directly or through a person acting  in his own name but 
on behalf of the SCE. 

However, the SCE's own shares may be accepted  as security  in the ordinary 
transactions of credit institutions. 

Article 13 

(Financial entitlements of members in the event of resignation or expulsion) 

1. Except where shares are assigned,  loss of membership shall entitle the 
member to repayment of the capital he has subscribed, reduced  in proportion 
to any losses charged against the capital of the SCE. 

The statutes may provide that a member  leaving the SCE shall be entitled  to a 
payment  in proportion to his share in the capital  from a reserve established 
for the purpose. 

2. The value of shares shall be calculated  by reference to the balance sheet 
for the financial  year  in which the entitlement  to repayment arose. 

3. The statutes shall  lay down the time  in which repayment  is to be made. 

4. Paragraphs  1, 2 and 3 shall apply where only a part of a member's 
shareholding  is to be repaid. 

.5. A member who has left the SCE or who has exercised  his entitlement  to 
partial  repayment  shall continue to be bound  by all the obligations  towards 
the SCE and towards third parties which were  incumbent upon him at the end of 
the financial  year by reference to which his entitlements were calculated, up 
to his previous shareholding  and any sums received  from the reserves, until 
the approval of the accounts of the  fifth  financial  year  following  the 
financial  year of reference. 

Article 14 

-S1 

(Minimum  capital) 
1. The capital of the SCE shall be denominated  in ecus or  in national 
currency. 

2.  (AMENDMENT No 58, modified) 

The capital of an SCE shall amount to not  less than ECU  100 000 or the 

equivalent  in national currency  if the SCE has been  formed by  legal persons 
governed by public or private law. 

The capital of an SCE shall amount to not less than ECU 50 000 or the 
equivalent  in national currency  if the SCE has been formed by natural persons 
and/or the statutes lay down that members who are natural persons shall 
constitute the majority  at general meetings. 

3. The statutes shall lay down a sum below which the capital may not be 
allowed to fall as a result of the withdrawal of the capital previously 
subscribed by members who resign or are expelled. 

4. The sum referred to in paragraph  3 shall be no less than the sum laid down 
by the law of the Member State  in which the SCE has its registered office, 
and, failing any such legal provision, no less than one tenth of the highest 
figure reached by the capital  since the SCE was  formed.  In no case may  it be 
less than the sum required by paragraph 2. 

Article 15 

(Capital of the SCE) 

1. The capital of the SCE shall be represented  by the members' shares 
referred to in paragraphs 3 and 4, denominated  in ecus or in national 
currency, and, where appropriate, by other  forms of own capital and quasi-
equity. More than one class of share may be issued. 

The statutes may provide that different  classes of share are to carry 
different entitlements with regard to the distribution of surpluses. Shares 
carrying the same entitlements shall constitute one class. 

2. Shares must be held by named  persons. The nominal value of shares in a 
single class shall be identical. It shall be  laid down  in the statutes. 
Shares may  not be  issued at a price  lower than their nominal value. 

3. Shares issued  for cash must be paid up on the day of the subscription to 
not  less than 25 % of their nominal  value. The balance must be paid up within 
a period of no more than five years. 

4. Shares  issued otherwise than  for cash must be fully  paid-up at the time of 
subscription. 

5.  (AMENDMENT  No 59) 

The statutes shall  lay down the minimum  number of  shares which must be 

subscribed  for  in order to qualify  for membership.  If they  stipulate that the 
majority  at general meetings must  be constituted  by members who are natural 
persons and  if they  lay down a subscription  requirement  for members wishing 
to take part  in the activities of the SCE, they may not make membership 
subject to subscription  for more than one share. They  shall also lay down the 

maximum proportion of the capital which any one member  is entitled  to hold. 

33 

6. The capital shall be variable. It may be increased  by  successive 
subscriptions by members or on the admission of new members, and  it may be 
reduced  by the total or partial  repayment of subscriptions, subject to 
Article  14  (2) . 

Variations  in the amount of the capital  shall not require amendment of the 
statutes or disclosure. 

When  it considers the accounts for the financial year, the general meeting 
shall by resolution record the amount of the capital at the end of the 
financial year and the variation by reference to the preceding  financial 
year. 

(AMENDMENT No 60) 

At the proposal of the administrative board or management board, the capital 
may be increased by the capitalization  of all or part of the reserves 
available  for distribution, following  a decision of the general meeting, in 
accordance with the quorum and majority  requirements  for an amendment of the 
statutes. 

7. The nominal value of shares may be increased  by consolidating the shares 
issued. Where such an increase necessitates a call  for supplementary  payments 
from the members under provisions  laid down  in the statutes, the decision 
shall be taken by the general meeting, in accordance with the quorum and 
majority  requirements  for an amendment of the statutes. 

Members voting against the decision may exercise their right to resign, in 
which case their  shares shall be repaid  in accordance with Articles 13 (1) 
and  14 (3). 

8. The nominal value of shares may be reduced by subdividing the shares 
issued. 

CHAPTER  II 

GENERAL  MEETING 

Article 16 

(Competence) 

The general meeting  shall decide on: 

(a) matters  for which  it has sole responsibility  under  this Regulation; 

(b) matters  for which the management board, supervisory  board or 
administrative board does not have sole responsibility  as a result of: 

-  this Regulation, 

- the Directive  [supplementing the Statute  for a European cooperative  society 
with regard to the  involvement of  employees), 

- the  law of the State where the SCE has  its registered office, 

-  the statutes of the SCE. 

Article 17 

(Holding of general meeting) 

1. A general meeting  shall be held  at  least once a year, not  later than six 
months after the end of the SCE's financial  year. 

2. General meetings may be convened  at any time by the management  board or 
the administrative  board. The management  board  is bound  to convene the 
general meeting  at the request  of the supervisory  board. 

3. The agenda  for the general meeting  held  after the end of the  financial 
year shall  include at least the approval of the annual  accounts and of the 
appropriation of the profit or treatment  of the loss and the approval of the 
annual  report  referred to in Article 46 of Directive  78/660/EEC, to be 
submitted  by the management  or administrative  board. 

4. The statutes of an SCE with a management  board  and  a supervisory  board may 
provide that  a decision on approval  of the annual  accounts  is to be taken 
jointly by the two boards in separate votes, and that the general meeting  is 
to pass a resolution only  if the boards are unable to reach  agreement. 

Article 18 

(Meeting called  by a minority of members) 

1. Not  less than 25 % of the members  of the SCE, which proportion may be 
reduced  by the statutes, may request  that  the general meeting  be convened  and 
its agenda set. 

2. The request  for a meeting  shall give the reasons  for convening  it and the 
items to be included  on the agenda. 

3. If, following  a request made under paragraph  1, the necessary  steps have 
not been taken within one month, the court or competent  authority within the 
State where the SCE's registered  office  is situated may order the convening 
of a general meeting or authorize either the members who have requested  it or 
their representative  to convene the meeting. 

4. A general meeting may during a meeting decide that  a further meeting be 
convened  and  set the date and the agenda. 

Article 19 

(Notice of meeting) 

1. The general meeting  shall be convened: 

- by a notice published  in the national gazette appointed  by the Member State 
in which the SCE has its registered  office  in accordance with Article 3 (4) 
of Directive 68/151/EEC, 

-  by a notice published  in one or more newspapers with  a large circulation  in 
the Member States, 

- or by a notice  in writing  sent to every member of the SCE by any  available 
means. 

2. The notice calling the general meeting shall contain the following 
particulars, at  least: 

-  the name and the registered  office of the SCE, 

(AMENDMENT No 62) 

- the place-, date and time of the meeting, 

- the type of general meeting  (ordinary, extraordinary  or  special), 

-  a statement of the formalities,  if any, prescribed  by the rules for 
attendance at the general meeting  and  for the exercise of the right to vote, 

-  the agenda, showing the subjects to be discussed  and the proposals  for 
resolutions. 

3.  (AMENDMENT No 63, modified) 

The period between the date of publication of the notice or the date of 

dispatch of the communication  referred to in paragraph  1 and the date of the 
opening of the general meeting  shall be not  less than 30 days. However, it 
may be reduced to 10 days in very urgent cases. 

Article 20 

(Addition of items to the agenda) 

Not  less than 25 % of the members of the SCE, which proportion may be reduced 
by the statutes, may, within ten days of receipt of the notice convening a 
general meeting, request  the addition of one or more  items to the agenda. 

Article 21 

(Attendance and proxies) 

1. Only members  shall be entitled  to speak and vote at the general meeting. 

2. Members of the management  board, authorized  representatives acting  for the 
holders of non-voting,  shares, members of the administrative board to whom 
management  responsibilities  have been delegated  and salaried managers may 
attend  the general meeting, and shall be entitled to speak but not to vote 
unless they are members of the SCE. 

3. Persons entitled  to vote shall be entitled  to appoint  a proxy to represent 
them at the general meeting  in accordance with procedures to be laid down in 
the statutes. 

4. The statutes may permit  postal  voting,  in which case they  shall  lay down 
the necessary  procedures. 

Article 22 

(Voting  rights) 

1. Each member  of  the SCE shall  have one vote,  irrespective of the number of 
shares he holds. 

(8) 

2.  (AMENDMENT No 65) 

^6 

The statutes may allow members  to have more than one vote when the SCE does 
not consist  of natural persons only. The statutes shall,  in that  event, lay 
down the circumstances  in which a member may  have more than one vote; this 
must depend  either on the measure to which  the member  takes part  in the SCE's 
activities or, solely  in the case of the non-user members  referred  to in 
Article  11(1),  on the proportion of capital  held. The statutes must  lay down 
limits on the number of votes which may be cast by a single member  to ensure 
that  no member  personally  controls more than a tenth of the votes at each 
general meeting. They must  also  lay down the number of other members  for whom 
a member may act as proxy. 

3. Members who do not expect  to use the services of the SCE  ('non-user' 
members) may together have voting  rights amounting  to no more than one third 
of those of all the members. 

Article 23 

(Rules of  conduct) 

The detailed  rules governing  the conduct  of general meetings  shall be laid 
down  in the statutes. 

Article 24 

(Right to  information) 

1. Every member  who so requests at a general meeting  shall be entitled  to 
obtain  information  from the management  or administrative  board on the affairs 
of the SCE arising  from  items on the agenda or concerning  matters on which 
the general meeting may take a decision  in accordance with Article 25 (2). 

2. The management  or administrative  board may  refuse to supply  such 
information only where: 

-  it would  be likely to be seriously  prejudicial  to the SCE, 

-  its disclosure would be incompatible with a legal obligation of 
confidentiality. 

3. A member to whom  information  is refused may  require that  his question and 
the grounds  for refusal be entered  in the minutes of the general  meeting. 

4. A member  to whom  information  is refused may challenge  the validity  of the 
refusal  in the court within whose  jurisdiction  the SCE has  its registered 
office. Application to the court  shall be made within two weeks of  the 
closure of the general meeting. 

5. In particular, before the general meeting  that  follows the end of  the 
financial  year members may examine any accounting  documents  that must  be 
drawn up  in accordance with the national measures adopted  pursuant  to 
Directives 78/660/EEC and 83/349/EEC. 

Article 25 

(Decisions) 

1. The general meeting  shall not pass any  resolution concerning  items which 
have not been communicated  or published  in accordance with Article  19 (2). 

s<? 

2.  Paragraph  1 shall not apply when all the members are present or 
represented  at the general meeting  and no member objects to the matter in 
question being discussed. 

3. The statutes shall  lay down the quorum and majority  requirements which are 
to apply to ordinary general meetings. 

4. The calculation of votes cast shall not  include abstentions or spoilt or 
blank votes. 

5. A general meeting may amend the statutes the first time it is convened 
only  if the members present or represented  represent  at  least half of the 
number of members on the date the general meeting  is convened,  and the second 
time it is convened only  if they make up or represent  at  least one quarter of 
that number. At least two thirds of the votes of the members present  or 
represented must be cast in favour. A general meeting may pass a resolution 
to wind up the SCE only  in accordance with the same requirements. 

The third time the meeting  is convened  no quorum  shall be necessary. 

The general meeting  shall act by majority of the votes held by the members 
present or represented. 

Article 26 

(Minutes) 

1. Minutes shall be drawn up for every general meeting. The minutes  shall 
contain the following particulars: 

- the place and date of the meeting, 

- the resolutions passed, 

- the result of the voting. 

2. There shall be annexed to the minutes the attendance  list, the documents 
relating  to the convening of the general meeting, and the reports  submitted 
to the members on the items on the agenda. 

3.  (AMENDMENT No 66) 

The minutes and the documents annexed  thereto shall be retained  for at least 

five years. A copy of the minutes and the documents annexed  thereto may be 
obtained  by any member upon request, in return for payment of the 
administrative cost. 

Article 27 

(Actions to have resolutions of general meeting declared  void) 

1. Resolutions of the general meeting may be declared  void on the grounds 
that they  infringe this Regulation or the statutes of the SCE  in the 
following manner: 

- an action  for such a declaration may be brought  by any member  provided  he 
can show that he has an  interest  in having  the  infringed  provision observed. 

S3 

- the action  for such a declaration  shall be brought within three months 
before the court within whose  jurisdiction  the SCE has  its registered office; 
the procedure  in the action shall be governed by the law of the State in 
which the SCE has its registered office, 

- having heard the SCE, the court may suspend application of the contested 
resolution; it may also require the applicant to lodge security  for the 
damage which may result  from the suspension of application of the resolution, 
if the application  is ultimately dismissed  as inadmissible or unfounded, 

-  judgments declaring a resolution void or ordering that  its application be 
suspended  shall be effective erga omnes, without prejudice to claims on the 
SCE acquired  in good  faith by third parties. 

2. Decisions of a court declaring a resolution of the general meeting void or 
non-existent  shall be the subject of disclosure  in accordance with Article 6. 

Article 28 

(Sectional meetings) 

Where the SCE carries on several distinct activities, or where it has several 
establishments, or where its activities span more than one territorial unit, 
or where  it has more than 500 members, the statutes may provide for the 
holding of sectional meetings to consider the same agenda separately  before 
the general meeting  is held. These meetings shall elect delegates, who shall 
in their turn be convened  as the general meeting. The statutes shall  lay down 
the division  into sections, the number of delegates  for each section, and the 
procedures to be followed. 

Article 29 

(Resolutions adversely  affecting the rights of a class of member) 

Where a resolution of the general meeting would adversely affect the rights 
of a particular class of member, it must be approved by those members by a 
separate vote, to which the voting rules referred  to in Article 22 shall 
apply mutatis mutandis. 

Where the statutes are to be amended  in a way which adversely  affects a 
particular  class of member, those members shall vote according to the 
majority  rules referred  to in Article 25 (5). 

CHAPTER  III 

MANAGEMENT,  SUPERVISORY  AND  ADMINISTRATIVE  BODIES 

Article 30 

(Structure) 

Under the conditions  laid down by this Regulation  the statutes of the SCE 
shall organize the structure of the SCE either according  to a two-tier  system 
(management board and supervisory board) or according to a one-tier  system 
(administrative  board). A Member State may, however, require that SCEs having 
their registered office on its territory  adopt either the two-tier or the 
one-tier  system as it shall determine. 

é>0 

Section I 

Two-tier system 

Subsection 1 

Management  board 

Article 31 

(Functions of the management  board; appointment  of members) 

1. The management  board  shall manage the SCE. The member or members of the 
management board  shall have the power to represent  the SCE  in dealings with 
third parties and  in legal proceedings  in accordance with the measures 
adopted pursuant  to Directive 68/151/EEC by the Member  State in which the SCE 
has  its registered office. 

2. The member or members of the management  board  shall be appointed  and 
removed by the supervisory  board. 

3. No person may at the same time be a member  of the management  board and of 
the supervisory  board. 

However, the supervisory board may nominate one of  its members to exercise 
the  function of member of the management  board  in the event of a vacancy. 
During  such a period the function of the person concerned  as member of the 
supervisory board  shall be suspended. 

4. The number of members of the management  board  shall be laid down  in the 
statutes of the SCE. 

Article 32 

(Chairmanship, convening  of meetings) 

1. The statutes may provide that the management  board  is to elect  a chairman 
from  among  its members. 

2. Meetings of the management  board  shall  be convened  in accordance with the 
statutes of the SCE or the rules of procedure of the board.  In any event any 
member  of the board may convene a meeting where urgency  requires, stating his 
reasons. 

Subsection 2 

Supervisory  board 

Article 33 

(Functions of the supervisory  board; appointment  of  members) 

1. The supervisory board  shall supervise the duties performed by the 
management board. It may not itself exercise the power to manage the SCE. The 
supervisory board may not represent the SCE in dealings with third parties. 
It shall represent the SCE in dealings with members of the management board, 
or one of them, in respect of  litigation or the conclusion of contracts. 

2.  (AMENDMENT No 68, modified) 

The members of the supervisory  board  shall be appointed  and removed by the 
general meeting. However, the members of the first supervisory board may be 
appointed  in the statutes. This provision  shall apply without prejudice to 
Article 40(3) and with the exception of the employees' representatives 
pursuant to Directive  — / . . . / E E C. 

2a)  (AMENDMENT No 69) 

Non-user members may be appointed to serve on the supervisory  board, taking 
up to a third of the posts available. 

3. The number of members of the supervisory board shall be laid down  in the 
statutes. A Member State may, however, stipulate the number of members of the 
supervisory board  for SCEs registered  in its territory. 

Article 34 

(Right to  information) 

1. The management board shall report to the supervisory board at least once 
every three months on the progress and  foreseeable prospects of the SCE's 
affairs, taking particular account of any  information  relating to 
undertakings controlled by the SCE that may significantly affect the progress 
of the SCE. 

2. The management board  shall communicate to the supervisory board without 
delay any  information which may have an appreciable effect on the SCE. 

3. The supervisory  board may at any time require the management board to 
provide information or a special report on any matter concerning  the SCE. 

4. The supervisory board may undertake all  investigations necessary  for the 
performance of  its duties. It may appoint one or more of  its members to carry 
out this task and may call in the help of experts. 

.  . 

5. Each member of the supervisory board  shall be entitled  to examine all 
information communicated by the management  board to the supervisory  board. 

Article 35 

(Chairmanship, calling of meetings) 

1. The supervisory  board  shall elect a chairman  from among  its members. 

2. The chairman  shall convene a meeting of the supervisory  board  under the 
conditions  laid down  in the statutes, on his own  initiative, or at the 
request of at  least one third of the members of the supervisory  board, or at 
the request of the management  board. The request must  indicate the reasons 
for calling the meeting.  If no action has been taken  in respect of  such a 
request within  15 days the meeting of the supervisory  board may be called by 

those who made the request. 

63 

Section II 

The one-tier  system 

Article 36 

(Functions of the administrative  board; appointment  of  members) 

1. The administrative board  shall manage the SCE. The member or members of 
the administrative board  shall have the power to represent  the SCE in 
dealings with third parties and in legal proceedings  in accordance with the 
measures adopted pursuant to Directive  68/151/EEC by the Member State in 
which the SCE has its registered office. 

2. The administrative board  shall have at  least three members within  limits 
fixed by the statutes. Non-user members may be appointed  to the 
administrative board, but may not form a majority. 

3. The administrative board may delegate to one or more of its members the 
power of management.  It may also delegate certain management  responsibilities 
to one or- more persons not members of the board; such management 
responsibilities may be revoked at any time. The statutes, or if the statutes 
are silent, the general meeting  shall  lay down the conditions within which 
such delegation  shall operate. 

4.  (AMENDMENT No 70, modified) 

With the exception of the employees' representatives  pursuant  to Directive 
.../.../EEC, the member or members of the administrative  board  shall be 
appointed  and removed by the general meeting. 

Article 37 

(Holding of meetings and right to  information) 

1. The management  board  shall meet at  least once every  three months, at 
intervals  laid down by the statutes, to discuss the progress and  foreseeable 
prospects of the SCE*s affairs, taking particular account of any  information 
relating  to undertakings controlled by the SCE that may  significantly affect 
the progress of the SCE. 

2. The administrative board shall meet to deliberate on the operations 
referred  to in Article 43. 

3. Each member of the administrative board  shall be entitled  to examine all 
reports, documents and  information supplied  to the board concerning the 
matters referred  to in paragraph 1. 

Article 38 

(Chairmanship, calling of meetings) 

1. The administrative board  shall elect a chairman  from among  its members. 

éM 
2. The chairman  shall convene a meeting of the administrative  board under the 
conditions  laid down  in the statutes, either oh his own  initiative or at the 
request of at least one third of the members. The request must  indicate the 
reasons  for calling the meeting.  If the request  is not  satisfied within 15 
days the meeting of the administrative  board may be called by those who made 
the request. 

Section  III 

Rules common to the one-tier and two-tier board  systems 

Article 39 

(Term of office) 

1. Members of the governing bodies shall be appointed  for a period  laid down 
in the statutes not exceeding  six years. 

2. Board members may be reappointed  one or more times for the period  laid 
down  in accordance with paragraph  1. 

Article 40 

(Conditions of  membership) 

1. The statutes of the SCE may permit  a legal person or any other  legal 
entity to be a member of a board, provided  that the law of the State in which 
the SCE has its registered office does not provide otherwise  in respect of 
domestic cooperative societies. 

That  legal person or other  legal entity  shall designate a natural person as 
its representative to exercise  its functions on the board  in question. The 
representative  shall be subject  to the same conditions and obligations as if 
he were personally  a member of the board. 

2. No person may be a member of a management,  supervisory  or  administrative 
board  nor a representative of a member within  the meaning of paragraph  1, nor 
have conferred  on him powers of management  or representation, who: 

-  under the law applicable to him, or 

- under the law of the State  in which the SCE has its registered office, or 

-  as a result of a judicial or administrative  decision delivered  or 
recognized  in a Member State, 

is disqualified  from serving on the management,  supervisory  or  administrative 
board  of any  legal person. 

3. This Regulation  shall  not affect  national  laws which  allow a minority of 
members or other persons or authorities to appoint  some of the board members. 

Article 41 

(Rules of  procedure) 

6S 

Each governing  body may draw up rules of procedure under the conditions  laid 
down by the statutes of the SCE. Any member  of the SCE or competent  authority 
may consult  those rules of procedure at the registered office of the SCE. 

Article 42 

(Power of representation;  liability of the SCE) 

1. Where the authority to represent  the SCE in dealings with third parties, 
in accordance with Articles 31  (1) and  36  (1), is conferred on two or more 
members of governing bodies, those persons shall exercise that  authority 
collectively. 

2. However, the statutes of the SCE may provide that the SCE shall be validly 
bound either by each of the members acting  individually  or by two or more of 
them acting  jointly. Such a clause may be relied upon against third  parties 
where  it has been disclosed  in accordance with Article  6. 

3. Acts performed  by members of the governing  bodies of the SCE shall bind 
the SCE vis-à-vis third parties, even where the acts in question are not in 
accordance with the objects of the SCE, providing  they do not exceed  the 
powers conferred  on them by law or which the law allows to be conferred  on 
them. 

However, Member  States may provide that the SCE shall not be bound where such 
acts are outside the objects of the SCE, if it proves that the third party 
knew that  the act was outside those objects or could  not  in view of the 
circumstances have been unaware of  it; disclosure of the statutes shall not 
of  itself be sufficient  proof  thereof. 

4. The appointment,  termination of office and particulars of the persons who 
may  represent  an SCE must be disclosed  in accordance with Article 6. The 
information disclosed must  state whether these persons are authorized  to bind 
the SCE  individually  or whether  they must  act  jointly. 

Article 43 

(Operations  requiring  authorization) 

1. The statutes of the SCE shall  set out  the categories of operation 
requiring  authorization  for the administrative  board by the  supervisory 
board,  under the two-tier  system,  or requiring  an express decision  from the 
administrative  board  under the one-tier  system. 

However, a Member  State may-provide that, under the two-tier  system,  the 
supervisory  board may  itself make certain categories of operation  subject  to 
authorization. 

2. A Member  State may  lay down the minimum  categories of operation which must 
feature  in the statutes of SCEs registered  on  its territory. 

Article 44 

(Rights and  obligations) 

£6 

1. Within the scope of the functions attributed  to them by this Regulation 
each of the members of a board  shall have the same rights and obligations as 
the other members of the board of which he is a member. 

2. All board members shall carry out their  functions  in the interests of the 
SCE, having  regard  in particular  to the interests of the members  and the 
employees. 

3. All board members  shall exercise a proper discretion, even after they have 
ceased  to hold office, in respect of  information of a confidential  nature 
concerning  the SCE. 

Article 45 

(Conduct of business on boards) 

1. Boards-of the SCE shall conduct  business under the conditions and  in the 
manner  set out  in the statutes of the SCE. 

Where the statutes are silent, a board  shall not conduct business validly 
unless at  least half of its members are present  at the discussions. Decisions 
shall be taken by majority of the members present or  represented. 

2. The chairman of each board  shall have a casting vote  in the event of a 
tie. 

Article 46 

(Civil  liability) 

1. Members of the management,  supervisory  or administrative  board  shall be 
liable for  loss or damage sustained  by the SCE as a result of breach of the 
obligations attaching  to their  functions. 

2. Where the board  concerned  is composed  of more than one member,  all the 
members shall be jointly and severally  liable  for loss or damage sustained by 
the SCE; however, a member may be relieved  of  liability  if he can prove that 
he is not  in breach of the obligations attaching  to his functions. 

Article 47 

(Proceedings on behalf of the SCE) 

1. The general meeting, by a majority of the votes of the members  present or 
represented,  shall take the decision to initiate proceedings, in the name and 
on behalf of the SCE, to establish  liability  under Article 46 (1). 

The general meeting  shall appoint a special  representative to conduct  the 
action. 

2. Not  less than one fifth of the members may  likewise decide to  initiate 
proceedings to establish  liability  in the name and on behalf  of the SCE. They 
shall appoint a special representative to conduct  the action. 

Article 48 

(Limitation of actions) 

o 

No proceedings on the SCE's behalf to establish  liability may be  initiated 
more than  five years after the act giving  rise to loss or damage. 

CHAPTER  IV 

CAPITAL,  OWN  FUNDS  AND  BORROWING 

Article 49 

(Holders of non-voting  shares) 

1. The statutes may provide for the issue of shares whose holders are to have 
no voting  rights, to be subscribed  for by members or by  non-members 
interested  in the progress of the SCE. 

2. Holders of shares which do not carry voting rights may be given  special 
advantages. 

3. The total nominal value of such shares held may not exceed a figure laid 
down  in the statutes. 

4. The statutes must  include provisions ensuring that the interests of 
holders of non-voting  shares can be represented  and  defended. 

In particular, the statutes shall provide  for special meetings of such 
shareholders. Before any decision of the general meeting  is taken, a special 
meeting may  state its opinion, which  shall be brought  to the attention of the 
general meeting by the representatives which the special meeting appoints. 

This opinion  shall be recorded  in the minutes of the general meeting. 

Article  50 

(Non-user  investor members) 

Where the statutes authorize persons who do not expect  to use the SCE's 
services to subscribe for voting shares, the statutes may  lay down special 
provisions  for the benefit of such non-user members with  regard to the 
distribution of surpluses. 

Article 51 

(Financing) 

(AMENDMENT No 71, modified) 

An SCE may avail  itself of all  forms of  financing  under the most  favourable 
conditions applying to cooperatives  in the State  in which  it has its 
registered office and  in the Member States  in which  it has its 
establishments. 

Article 52 

(Dividend) 

6g 

The statutes may provide for the payment  of a dividend  to members in 
proportion to their business with the SCE, or the services they have 
performed  for it,  in accordance with  the law governing  cooperative  societies 
in the State in which the SCE has its registered  office. 

Article 53 

(Legal  reserve) 

1. The statutes shall provide for the mode of application of the surplus for 
each  financial year. 

2. Where there is a surplus the statutes shall require the establishment  of a 
legal reserve funded out of the surplus before any  further  allocation. 

Until such time as the legal reserve  is equal to the capital of the SCE, the 
amount allocated  to it may not be less than  15 % of the surplus. 

3. Members  leaving the SCE shall have no claim against  the sums thus 
allocated  to the legal reserve. 

Article 54 

(Allocation of the available  surplus) 

1. The balance of the surplus after deduction of the allocation  to the legal 
reserve and of any sums paid out  in dividends, with the addition of any 
surpluses carried over  from previous years, shall constitute the surplus 
available  for distribution. 

2. The general meeting which considers the accounts  for the  financial  year 
may allocate the surplus in the order  and proportions  laid down by the 
statutes, and  in particular: 

- carry  them  forward  to the next  account, 

- appropriate them to any ordinary or extraordinary  non-statutory  reserve 
fund, 

- provide a return on paid-up capital  and own  funds and quasi-equity,  payment 
being made  in cash or shares. 

3. The statutes may also prohibit  any  distribution. 

CHAPTER  V 

ANNUAL  ACCOUNTS,  CONSOLIDATED  ACCOUNTS,  AUDITING  AND  DISCLOSURE 

Article 55 

6g 

(Preparation of annual accounts and consolidated  accounts) 

1. For the purposes of drawing up its annual accounts and  its consolidated 
accounts if any, including the annual report accompanying  them and their 
auditing  and publication, the SCE shall be subject to the measures adopted in 
the State in which  it has its registered office pursuant  to Directives 
78/660/EEC and 83/349/EEC. 

2. The SCE may draw up its annual accounts, and  its consolidated  accounts if 
any,  in ecus. In this event the bases of conversion used to express  in ecus 
those  items included  in the accounts which are or were originally  expressed 
in another currency must be disclosed in the notes to the accounts. 

Article 56 

(Auditing) 

The annual accounts of the SCE, and  its consolidated  accounts, if any, shall 
be statutorily  audited by one or more persons authorized to do so in the 
Member State in which the SCE has its registered office  in accordance with 
the measures adopted  in that State pursuant  to Directives 84/253/EEC and 
89/48/EEC. Those persons shall also verify that the annual report  is 
consistent with the annual accounts, and the consolidated  accounts if any, 
for the same financial year. 

Article 57 

(Internal audit  body) 

The statutes may provide  for the establishment  of an  internal body whose 
members, elected  from among the members of the SCE, shall be responsible for 
auditing  the SCE's accounts and monitoring  its management  on a continuous 
basis. They shall report on their activities each year to the general 
meeting. Where the law of the State in which the SCE has its registered 
office requires that the accounts of cooperative societies be  statutorily 
audited by persons outside the society, an  internal audit body cannot  replace 
the persons performing  the statutory audit. 

Article 58 

(System of auditing) 

1. An SCE must accept and submit  to a system of auditing where the law of the 
State  in which the SCE has its registered office requires such a system for 
all cooperatives covered by the law of that State, without prejudice to 
Article 56. 

2.  In Member States where the  law governing  national cooperative  societies 
requires an audit by one or more audit bodies, those bodies shall be 
authorized  to audit the consolidated  accounts provided  the parent  society has 
its registered office  in one of those States. 

Article 59 

(Disclosure of accounts) 

1. The annual accounts, the consolidated  accounts  if any, duly approved, and 
the annual report and audit  report  shall be disclosed  in accordance with the 
measures adopted by the Member  State  in which the SCE has its registered 
office pursuant  to Article 3 of Directive 68/151/EEC. 

2. Where SCEs are not subject, under the law of the Member  State  in which the 
SCE has its registered  office, to a disclosure  requirement  as provided  for in 
Article 3 of Directive 68/151/EEC, the SCE must  at  least make the accounting 
documents available to the public at  its registered  office. Copies of these 
documents must be obtainable on request. The price charged  for these copies 
must  not exceed  the administrative  cost. 

Article 60 

(Credit or  financial  institutions and  insurance  undertakings) 

SCEs which are credit or financial  institutions or  insurance  undertakings 
shall comply, as regards the drawing-up, auditing and disclosure of annual 
accounts and consolidated  accounts, with the rules  laid down by the measures 
adopted  in the Member State in which the SCE has its registered  office 
pursuant to Directive 86/635/EEC, or, as the case may be, pursuant  to Council 
Directive  91/674/EEC(19). 

CHAPTER  VI 

WINDING  UP  AND  LIQUIDATION 

Section I 

Winding up 

Article 61 

(Winding up by the general meeting) 

1. An SCE may be wound up by a decision of the general meeting ordering  its 
winding up, taken  in accordance with the rules  laid down  in Article 25 (5). 

However, the general meeting may decide,  in accordance with the same rules, 
to annul  the decision to wind up, as long  as there has been no distribution 
on the basis of the liquidation. 

2. The management or administrative board must convene a general meeting to 
take a decision on the winding up of the SCE: 

- where the period  fixed  in the statutes has expired, 

- where the subscribed  capital  has been  reduced below the minimum  capital 
laid down  in the statutes, 

- where the disclosure of accounts has not taken place  in the SCE's last 
three financial years, 
(19) OJ No L 

- where the number of members is below the minimum required by this 
Regulation or by the SCE's statutes, 

}1 

Il 
- on any grounds  laid down either  in the  law governing  the legal entities 
which  founded the SCE, in the State  in which the SCE has its registered 
office, or in the statutes. 

The general meeting  shall decide: 

- either to wind up the SCE in accordance with Article 25 (7), 

- or, in accordance with Article 25  (5), that the SCE shall continue its 
activities. 

Article 62 

(Winding up by the court) 

On an application by any person concerned  or any competent authority, the 
court of the place where the SCE has its registered  office must order the SCE 
to be wound up where it finds that the registered  office has been transferred 
outside the Community, or that the SCE's activities are being carried on 
contrary to public policy  in the Member State  in which the SCE has its 
registered office, or  in breach of Article  1  (2) or  (3) or of Article 9 (1). 

The court may grant the SCE a period of time to rectify the situation. If it 
fails to do so within the time allowed  the court  shall order  it to be wound 
up. 

1. Where an SCE no longer  fulfils the obligation  set out  in Article 2, the 
Member State in which the SCE has its registered  office shall take 
appropriate measures to requrie the SCE to rectify the situation within a 
fixed time: 

either by reestablishing  its central  administration  in the Member  State 
in which  its registered  office  is situated, 

or by transferring  the registered  office according to the procedure set 
out  in Article 8. 

2. Should the SCE  fail to comply with these measures, the court or other 
competent  authority  in the Member State  in which the registered office is 
situated  shall declare that the SCE  is being wound up and proceed with its 
liquidation. 

3. The Member State  in which the registered  office  is situated  shall 
institute  legal proceedings against  any  infringement  of Article 2.  Such 
proceedings  shall  have suspensory  effect on the procedures provided  for in 
the foregoing paragraphs. 

4. Where  it is found, on the  initiative of the authorities or of any 
interested  party, that an SCE has  its central  administration  in the territory 
of a Member State  in violation of Article 2, the authorities  in this Member 
State'shall  forthwith  inform the Member  State  in which  the registered  office 
is situated. 

13 

Section II 

Liquidation 

Article 63 

(Liquidation) 

1. The winding up of an SCE shall entail  its liquidation. 

2. The liquidation of an SCE and the conclusion of  its liquidation  shall be 
governed by the law of the State  in which  it has its registered office. 

3. An SCE in liquidation shall continue to have legal personality  until the 
conclusion of the liquidation. 

4. Following the liquidation, the books and records relating to the 
liquidation shall be lodged at the register referred  to  in Article  5  (3). Any 
interested  party may examine such books and records. 

Article 64 

(Distribution) 

(AMENDMENT No 74) 

After the creditors have been paid  in full, and anything due to designated 
beneficiaries has been distributed, net assets shall be distributed  in 
accordance with the principle of disinterested  distribution,  i.e. 
distribution to other SCEs or cooperative  societies governed by the law of a 
Member State or to one or more bodies having as their object the support and 
promotion of cooperative societies. 

However, two exceptions to the above principle shall be admissible: 

any other type of distribution may be provided  for in the instrument of 
incorporation; 
on a proposal  from the management  board or administrative board, the 
general meeting, acting by a two-thirds majority, may  adopt a different 
form of distribution. 

CHAPTER  VII 

INSOLVENCY  AND  SUSPENSION  OF  PAYMENTS 

Article 65 

(Insolvency  and suspension of  payments) 

1. The SCE shall be subject to the law of the State  in which  it has its 
registered  office  in respect of  insolvency  and  suspension of payments. 

2. The opening of  insolvency  or suspension of payments proceedings  shall be 
notified  by the person appointed  to conduct  the proceedings  for entry  in the 
register  referred  to in Article  5 (3). The entry  in the register  shall show 
the  following: 

(a) the nature of the proceedings, the date of the order, and the court 
making it; 

(b) the date on which payments were suspended,  if the court order provides 
for this; 

^M 

(c) the name and address of the administrator, trustee, receiver, liquidator 
or any other person having power to conduct  the proceedings, or of each of 
them where there are more than one; 

(d) any other  information considered  necessary. 

3. Where the court  finally dismisses an application  for the opening of the 
proceedings referred to in paragraph 2 owing to want of sufficient assets, it 
shall, either of  its own motion or on application by any  interested party, 
order  its decision to be noted  in the register referred  to in Article 5 (3). 

4. Particulars registered  pursuant to paragraphs 2 and  3 shall be published 
in the manner referred to in Article  6. 

TITLE  II 

FINAL  PROVISIONS 

Article 66 

(Measures to be applied  in the event of a breach of  rules) 

Each Member State shall specify the appropriate measures to be imposed  in the 
case of breach of the provisions of this Regulation and, where appropriate, 
of any relevant national measures; the penalties must be effective, 
proportionate and dissuasive. 

Each Member State shall take the necessary measures before 1 January  1994 and 
shall  forthwith  inform the Commission thereof. 

Article 67 

This Regulation  shall enter  into force on  1 January 1994. 

This Regulation  shall be binding  in its entirety  and directly  applicable in 
all Member States. 

Done at Brussels, 

For the Council 
The  President 

IS 

ANNEX 

Legal entities referred to in Article 9 

In Belgium 

cooperative  societies governed  by Sections  141 to 164 of the Consolidated 
Commercial  Companies Act; mutual  insurance  associations within the scope of 
Section 2 of the Insurance Act of  11 June  1874 and Section  11 of the Act of 9 
July  1975 on the Supervision of  Insurance Undertakings; and mutual  societies 
within the scope of the Act of 6 August  1990 on Mutual  Societies and National 
Unions of Mutual  Societies 

In Denmark 

cooperative societies and associations as defined  and recognized  under the 
principles  formulated  by the International  Cooperative Alliance  (ICA), and 
entities such as the Supplementary  Health  Insurance Fund and mutual  societies 

In Spain 

cooperatives within the scope of Act  No 3/1987  of 2 April  1987; credit 
cooperatives within the scope of the Act of 26 May  1989; workers  limited 
companies within the scope of the Act of 25 April  1986; cooperatives within 
the scope of the following  legislation of the autonomous  communities: 
- Basque country: the Act of  11 February  1982, 
- Catalonia: the Act of 9 March 1983, 
- Andalusia: the Act of May 1985, 
- Valencia: the Act of 25 October 1985, 

and the social providence bodies,  industrial  accident  mutual  societies and 
mutual  societies governed  by the Act of 2 August  1984 on the Regulation of 
Private  Insurance 

In France 

cooperatives within the scope of the Cooperative  Statute of  10 September 
1947; mutual  insurance societies governed  by R. 322-42 et seq. of the 
Insurance Code; and mutual  societies governed  by the Mutual  Societies Code of 
25 July  1985 

In Greece 

cooperatives within the scope of Act  No  1541 of  1985; and entities within the 
scope of the law on mutual  societies 

In Ireland 

cooperatives and other  societies within the scope of the  Industrial  and 
Provident Societies Acts of  1893, the Friendly  Societies Acts, the amendment 
to the 1893 Industrial and Provident  Societies Act  1978, the Credit  Union Act 
1966, public  limited companies, and the Voluntary  Health  Insurance  Board 
governed  by the Voluntary  Health  Insurance Act  1957 

In Italy 

IG 

cooperative societies and mutual  insurance societies governed by Title VI of 
the Civil Code; the cooperatives referred  to by  legislation and  regulations 
specific to certain categories; and the mutual  insurance societies and mutual 
societies within the scope of the Mutual Societies Code of  15 April  1886 

In Luxembourg 

cooperative societies governed  by Sections  113 et seq. of the Commercial 
Companies Act of 10 August  1915; mutual  insurance associations governed by 
Section 2 of the Act of  16 May  1891; mutual assistance societies and mutual 
societies governed by the Act of 7 July  1961 and the Grand-Ducal  Regulation 
of 31 July  1961 

In the Netherlands 

cooperative unions governed by Title III on associations, of the Second Book 
of the Civil Code; mutual guarantee societies provided  for in the regulations 
on mutual guarantee societies; and the health  insurance  funds  (Association of 
Dutch Health  Insurers  (VNZ) and the Silver Cross  (Zilverenkruis), within the 
scope of the Act of  1 January  1966 or of the General Act on Special Health 
Expenses 

In Portugal 

cooperatives governed by Decree-Law No 454/80 of 9 October  1980, and 
cooperatives referred to by the Code and governed by  laws dealing 
specifically with certain sectors; mutual  societies and associations within 
the scope of Decree-Law No 72/90 of  3 March  1990; charitable  institutions 
(misericordias) within the scope of Sections  167 to 194 of the Civil Code, on 
associations and  foundations; and mutual  insurance  societies 

In Germany 

cooperatives governed by the Act of  1 May  1889  (RGB1. S. 55) published on 20 
May  1898  (RGB1. S. 369, 810) as amended  in particular by the Amending Act of 
8 October  1973  (BGB1. I S. 1451) and the Company Accounts  Directives 
Transposition Act of 19 December  1985  (BGB1.  I S. 2355); mutual  insurance 
associations within the scope of the Insurance Undertakings Supervision Act 
of 6 June 1931, as amended on 1 July  1990 

In the United  Kingdom 

cooperatives governed by the Industrial and Provident  Societies Acts 1876; 
all other  forms of company or partnership  recognized  under the cooperative 
principles  laid down by the International  Cooperative Alliance; and  societies 
within  the scope of the Friendly  Societies Acts, the Building  Societies Acts, 
and the Credit  Unions Act  1979 

Amended  proposal  for  a  Council  Directive  supplementing  the  statute  for  a  European 
cooperative society with regard to the involvement of employees 

2L3 

THE  COUNCIL  OF  THE  EUROPEAN  COMMUNITIES, 

§YN 3Q9 

Having  regard to the Treaty establishing the European Economic Community and 
in particular Article 54 thereof, 

Having regard to the proposal  from the Commission, 

In cooperation with the European Parliament, 

Having  regard to the opinion of the Economic  and Social Committee, 

Whereas,  in order to attain the objectives set out  in Article 8a of the 
Treaty, Regulation  (EEC) No  . . .(*) establishes a statute for a European 
cooperative society  (SCE); 

Whereas there are in the Member States  laws, regulations and  administrative 
provisions concerning the provision of  information to and the consultation of 
the employees of undertakings, whatever their  legal  form; whereas  in some 
Member States, there are provisions concerning  the participation of employees 
in cooperatives; 

Whereas it is desirable to coordinate information and  consultation 
arrangements at Community  level  in order to develop dialogue between the 
management boards and administrative boards of SCEs and employees; 

Whereas the realization of the internal market  is giving  rise to a process of 
concentration and conversion of cooperatives; whereas  in order to ensure a 
harmonious development of economic activities, SCEs carrying on  cross-border 
activities must adopt, if appropriate, a participation model, or, failing 
this,  inform and consult employees on decisions which concern them; 

Whereas this Directive determines the minimum  areas where there must be 
information and consultation, without prejudice to the application of the 
following Directives: 

- Council Directive 75/129/EEC of  17 February  1975 on the approximation of 
the  laws of the Member States relating  to collective  redundancies^), as 
amended  by Directive  .../.../EEC<3), 

- Council Directive 77/187/EEC of  14 February  1977 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 
businesses^), 

- Council Directive  .../.../.../EEC of  ... on the establishment of a European 
Works Council  in Community-scale undertakings or groups of undertakings  for 
the purposes of  informing  and consulting  employees^5); 

(1) OJ No L 
(2) OJ No L 48, 22.2.1975, p. 29 
(3) COM(91) 292 final, 15.7.1991 
(4) OJ No L 61, 5.3.1977, p. 26. 
(5) COM(90) 581 final. 

(AMENDMENT No 79) 

^s 

Whereas appropriate provisions must be adopted to ensure that the employees 
of SCEs are properly  informed  and consulted without undue delay where 
decisions likely to affect their  interests or which have a potential  impact 
on the prospects of the SCE and the conditions of employment are taken in a 
Member State other than that in which they are employed; 

Whereas the laws, regulations and administrative provisions of the Member 
States governing the participation of employees  in national cooperatives may 
be made applicable to SCEs; 

Whereas an SCE may not be registered  until  a participation model or, in the 
absence thereof, an employee  information  and consultation  system and in 
particular  a separate committee has been chosen; 

Whereas, however, the natural persons who  founded the SCE or, where no 
agreement  is reached prior to registration of the SCE, the founder entities 
should propose to the general meeting  called  to approve the formation of the 
SCE certain requirements with respect to informing and consulting employees; 

Whereas the information and consultation  committee or any other  alternative 
body must be informed and consulted  about decisions on the part of the SCE 
capable of affecting  the employees' interests; 

Whereas in order to ensure the proper  functioning of the  internal market and 
avoid any  inequality  in the terms of competition, the employees of the SCE 
should be guaranteed equivalent  levels of  information and consultation; 

Whereas in order to allow for more flexibility with respect to small SCEs, 
Member States need not provide  for employee representation  in SCEs employing 
fewer than 50 workers; 

Whereas the provisions of this Directive  form an indissociable supplement to 
those of Regulation  (EEC) No  . . . /  . . . (on the statute  for a European 
cooperative  society); whereas  it is therefore necessary  to ensure that the 
two sets of provisions are applied  concomitantly, 

HAS  ADOPTED  THIS  DIRECTIVE: 

Article 1 

This Directive coordinates the  laws, regulations and  administrative 
provisions of the Member States concerning  the involvement of employees in 
the SCE. 

This Directive  is an essential  supplement  to Regulation  (EEC) No  .../.../... 
(on the statute for a European cooperative  society). 

No SCE may be registered  until a participation model or, in -the absence 
thereof, an information and consultation  system  has been chosen  in accordance 
with the provisions of this Directive. 

TITLE  I 

Participation 

Article 2 

^3 

The  laws, regulations and administrative provisions of a Member State 
governing the participation of employees  in the supervisory or  administrative 
boards of national cooperative societies may be made applicable to an SCE 
whose registered office is in its territory. 

Where such provisions are not applied  the Member State shall take the 
necessary measures to ensure at least that the employees of the SCE are 
informed  and consulted  in accordance with Articles 3, 4 and 5. 

TITLE  II 

Information and consultation  arrangements 

Article 3 

1. The management boards or administrative boards of the founder entities and 
the representatives of the employees of those entities provided  for by the 
laws and practices of the Member States shall agree arrangements  for 
informing  and consulting the employees of the SCE. The agreement must be 
concluded  in writing before the SCE is registered. 

(AMENDMENT No 87) 

2. Where no such agreement can be reached  the representatives of the 
employees of the founder entities may make a written  statement  setting out 
the reasons for the failure to reach agreement. 

3. Where the SCE is formed solely by natural persons, those persons shall lay 
down information and consultation procedures on the basis of the requirements 
with respect to informing  and consulting employees set out in Article 4(1); 
those procedures must be submitted to the general meeting  called to approve 
the formation of the SCE. 

4. The management boards or administrative  boards of the founder entities 
shall draw up for submission to the general meeting  called to approve the 
formation of the SCE a report to which  is attached  either 

- the text of the agreement  referred  to in paragraph  1, or 

-  the statement by the employees' representatives referred  to  in paragraph 2. 

5. The general meeting  called to approve the  formation of the SCE shall 
ratify  the  information  and consultation  arrangements embodied  in the 
agreement  referred  to in paragraph  1, or where no agreement  has been reached, 
shall decide on the arrangements which are to apply to the SCE  in the light 
of the report  and of the statement  referred  to in paragraphs  2 and 3. 

6. The arrangements chosen may  subsequently  be replaced by other  arrangements 
agreed between the SCE's management  board  or administrative  board  and the 
representatives of the employees of the SCE. The agreement must be submitted 
to the general meeting  for approval. 

7. The procedure  laid down  in this Article  shall apply  in the event of 
conversion  pursuant to Article 9  (2) of the Regulation  (EEC)  . . / . ..  (on 
the statute  for a European cooperative  society). 

(AMENDMENT No 88) 

So 

8. In the event of the registered  office of an SCE being transferred  to 
another Member State, the information and consultation  arrangements in 
existence before the transfer may be altered  by agreement  between the 
management board or the administrative board of the SCE and the 
representatives of the employees of the SCE. 

Article 4 

S) 

1. The management board or the administrative board of the SCE shall inform 
and consult  in good time the employees of that entity  at least  in the 
following areas: 

(AMENDMENT No 89) 

(a) any proposals which might significantly affect the interests of the 
employees of the SCE or which have a potential  impact on the prospects of the 
SCE and the conditions of employment  and especially  all matters concerning 
working  conditions and all decisions requiring the approval of the management 
board or the administrative board, without prejudice to the Community 
provisions concerning  information and consultation, and  in particular 
Directives 75/129/EEC, 77/187/EEC and  . . . / EEC  (on the establishment of a 
European works council); 

(b) any question concerning conditions of employment, in particular  changes 
affecting the organization of the SCE and the introduction of new working 
methods or new products and/or services; 

(c) all documents submitted to the SCE's general meeting; 

(d) the operations referred to in Article 43  (1) of the Regulation  (EEC) 
.  . . (on the statute for a European cooperative  society); 

(AMENDMENT No 90) 

(e) the development and organization of vocational training undertaken  in the 
SCE and any matter affecting the health and safety of employees, with equal 
and  joint participation  in the development of health and  safety  programmes 
and policies  in the SCE. 

(AMENDMENTS  Nos 155 and 91, modified) 

2. The employees of the SCE shall be informed  and  consulted: 

- within a separate committee representing  the employees of the SCE, or 

- within any other structure agreed  between  the management  boards or 
administrative boards of the founder entities and the representatives of the 
employees of those entities. 

These procedures must be completed  in good  time before any decision  is 
reached, so that any objections raised  by the employees' representatives may 
be taken  into account. 

In addition, by way of preparation  for the consultation  procedure, experts 
may be called  in as advisers and the management board or administrative board 
shall make available all appropriate  facilities thereto. 

A Member State may restrict this range of  information  and  consultation 
arrangements  in the case of SCEs having  their  registered  head office  in its 
territory. 

3. In an SCE with  fewer than 50 employees the two parties to the negotiations 
may decide that simplified  information  and consultation  arrangements  should 
be  laid down, subject to compliance with paragraph  1. 

Article 5 

1. The representatives of the employees of the SCE shall be elected, and 
shall be provided with such  facilities as are necessary  to enable them to 
perform their duties properly,  in accordance with the  laws and practices of 
the Member States and in compliance with the  following principles: 

(a) employees' representatives must be elected  in each Member State  in which 
the SCE has establishments or subsidiaries; 

(b) the number of representatives  so elected must as far as possible be in 
proportion to the number of employees they represent; 

(c) all employees must be able to participate  in the vote irrespective of 
their  length or'service or the number of hours they work per week; 

(d) the election must be by secret ballot. 

2. The employees' representatives elected  in accordance with paragraph  1 may 
perform their  functions within the SCE  irrespective of the rules governing 
qualification as an employees' representative  in the law of the Member State 
in which the SCE has its registered office. 

(AMENDMENT  No 93) 

The employees' representatives  shall not be discriminated  against  in any way 
on grounds of their activities. They  shall enjoy protection  against 
dismissal, unless there are exceptional grounds  for their dismissal. They 
shall also enjoy protection against other penalties  imposed on account of 
anything they do, say or write in connection with the performance of their 
duties. 

(AMENDMENT  No 94) 

The elected employees' representatives may  carry out their duties during 
working hours. 

TITLE  III 

Final  provisions 

Article 6 

The provisions of Titles  I and  II shall  not be applicable where the majority 
of the employees of the SCE are also members thereof. 

Article 7 

1. Member States shall bring  into  force the  laws, regulations and 
administrative provisions necessary  to comply  with this Directive before 1 
January  1994. They  shall  immediately  inform  the Commission  thereof. 

When Member States adopt these provisions, these shall contain a reference to 
this Directive or shall be accompanied  by  such  reference at the time of their 
official  publication. The procedure  for such  reference  shall be adopted by 
Member States. 

2. Member States shall  communicate  to the Commission  the main provisions of 

national  law which they adopt  in the field covered by this Directive. 

-83 

Article 8 

This Directive  is addressed  to the Member States. 

Done at Brussels, 

For the Council 

S S 

Amended  proposal  for a 
COUNCIL  REGULATION  (EEC) 

on the Statute for a European mutual  society 

THE  COUNCIL  OF  THE  EUROPEAN  COMMUNITIES, 

Having regard to the Treaty establishing  the European Economic Community, and 
in particular Article  100a thereof, 

Having  regard to the proposal  from the Commission, 

In cooperation with the European Parliament, 

Having regard to the opinion of the Economic and Social Committee, 

Whereas the Commission adopted a communication to the Council of 18 December 
1989t1); whereas the Economic and Social Committee gave its opinion on that 
communication on 19 September  1990t^); 

Whereas the completion of the internal market means that there must be full 
freedom of establishment  for all activities which contribute to the 
objectives of the Community,  irrespective of the form taken by the body which 
carries them on; 

Whereas, therefore, the Community, which  is concerned  to respect equal terms 
of competition and to contribute to its economic development, should provide 
mutual societies, which are a form of organization generally  recognized  in 
most Member States, with adequate  legal  instruments capable of  facilitating 
the development of their transnational activities; 

Whereas by the attainment of their objectives and the form of their 
operations mutual  societies play  a full part  in the life of the economy; 

Whereas the statute for a European company, as provided  for in Regulation 
(EEC) No  . . . /.  .  . (3),  is not an instrument which  is suited  t o t he 
specific  features of mutual societies; 

Whereas the European Economic  Interest Grouping  (EEIG), as provided  for in 
Regulation  (EEC) No 2137/85(4), does allow groupings to promote certain of 
their activities  in common, while nevertheless preserving their independence, 
but  it does not meet the specific  requirements of mutual societies; 

Whereas respect  for the principle of the primacy of the  individual  is 
reflected  in the specific rules on membership, resignation  and expulsion, 
where the one-man, one-vote rule is laid down and the right to vote  is vested 
in the individual, with the implication  that members cannot exercise any 
rights over the assets of the-society; 

(1) Businesses  in the  'économie sociale' sector  - Europe's  frontier-free 

market: SEC(89) 2187 final, 18.12.1989. 

(2) OJ No C 332, 31.12.1990, p. 81. 
(3) OJ No L 
(4) OJ No L 199, 31.7.1985, p. 1. 

té 

Whereas mutual societies are essentially  groups of persons operating  in 
accordance with their own principles, which are different  from those applying 
to other businesses; 

Whereas cross-border cooperation between mutual societies in the Community is 
currently  hampered by  legal and administrative difficulties which should be 
eliminated  in a market without  frontiers; 

(AMENDMENT No 163/corr) 

Whereas the introduction of a European  form of organization which would be 
available to mutual societies, based on common principles but taking  account 
of the specific  features of, on the one hand, mutual  societies carrying on 
providence activities and, on the other, mutuals engaged  in other activities, 
in particular  insurance, should enable them to operate outside their own 
national borders in all or part of the territory  of the Community; 

Whereas the essential aim of the legal rules governing  the European mutual 
society  implies that such a society may be set up by  legal entities from 
different Member States, or by transformation of a national mutual  society 
into the new form, without  first being wound up, so long as the mutual 
society has its registered office and central administration  in the Community 
and an establishment or subsidiary  in a Member State other than that  in which 
it has its central administration;  in this  last case, the mutual  society must 
engage in genuine and effective cross-border  activity; 

Whereas European mutual societies  should  hold a formation  fund; 

Whereas the rules on accounting  are intended  to ensure more effective 
management  and to forestall any possible difficulty; 

(AMENDMENT No 98) 

Whereas this Regulation does not affect basic obligatory  social  security 
schemes managed  in certain Member States by mutual  societies and the  liberty 
of Member States to decide whether or not and under what  conditions to 
entrust the management of these schemes to mutual societies; 

Whereas, on matters not covered  by this Regulation, the provisions of the law 
of the Member States and of Community  law are applicable,  for example with 
regard to: 

-  rules on employee  involvement  in the decision-making  process, 

- employment  law, 

- taxation  law, 

- competition  law, 

-  intellectual  and  industrial  property  law, 

-  rules on  insolvency  and  suspension of payments; 

3^ 

Whereas the application of this Regulation must be deferred  so as to enable 
each Member State to incorporate into its national  law the provisions of the 
Council Directive supplementing the Statute for a European mutual  society 
with regard to the involvement of employees^5) and to put  in place in 
advance the necessary machinery  for securing the formation and operation of 
European mutual societies having their registered office  in its territory, so 
that the Regulation and the Directive may be applied concomitantly; 

Whereas work on the approximation of national company  law has made 
substantial progress so that reference may be made to certain dispositions 
made by the Member State where the European mutual society has its registered 
office for the purpose of implementing  directives on companies, by analogy 
for the European mutual society  in areas where the functioning  of the society 
does not require uniform Community  rules, such dispositions being  appropriate 
to the arrangements governing  the European mutual  society: 

- Council Directive 68/151/EEC of 9 March  1968 on coordination of  safeguards 
which, for the protection of the interests of members and others, are 
required by Member States of companies within the meaning of the second 
paragraph of Article 58 of the Treaty, with a view to making  such  safeguards 
equivalent throughout the Community(°), as last amended by the Act of 
Accession of Spain and Portugal, 

- 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(7),  as last 
amended by Directives 90/604/EEC<8>  and  90/605/EEC<9), 

- Council Directive 83/349/EEC of 13 June 1983 based on Article 54(3)(g) of 
the Treaty on consolidated  accounts^0),  as last amended by Directives 
90/604/EEC and 90/605/EEC, 

- Council Directive 84/253/EEC of  10 April  1984 based on Article  54(3)(g) of 
the Treaty on the approval of persons responsible  for carrying out the 
statutory  audits of accounting documents ( *•*•), 

- Council Directive 89/48/EEC of 21 December  1988 on a general system  for the 
recognition of higher-education diplomas awarded on completion of 
professional education and training of at least three years'  duration^^), 

- Council Directive 89/666/EEC of 21 December  1989 concerning  disclosure 
requirements  in respect of branches opened  in a Member State by certain types 
of company governed by the law of another  State(^^); 

Whereas the activities in the field of  financial  services and notably as they 
concern establishments and insurance enterprises have been the subject of 
legislative measures pursuant to the  following Directives: 

(5) OJ No L 
(6) OJ No L 65, 14.3.1968, p. 8. 
(7) OJ No L 222, 14.8.1978, p. 11. 
(8) OJ No L 317, 16.11.1990, p. 57. 
(9) OJ No L 317, 16.11.1990, p. 60. 
(10) 
(11) 
(12) 
(13) 

OJ No L 193, 18.7.1983, p. 1. 
OJ No L 126, 12.5.1984, p. 20. 
OJ No L 19, 24.1.1989, p. 16. 
OJ No L 395, 30.12.1989, p. 36. 

-  «-

- Council  Directive 86/635/EEC of 8 December  1986 on the annual  accounts and 
consolidated  accounts of banks and other  financial  institutions^^), 

- Council Directive 89/646/EEC of  15 December  1989 on the coordination of 
laws, regulations and administrative  provisions  relating  to the taking  up and 
pursuit  of the business of credit  institutions  and amending  Directive 
77/780/EEC<15), 

- Council Directive  . . / . ..  /EEC of  . ..  on the coordination of laws, 
regulations and administrative  provisions  relating  to direct  insurance other 
than  life insurance and amending Directives 73/239/EEC and 88/357/EEC  (*6); 

Whereas this form of organization  should be optional, 

HAS  ADOPTED  THIS  REGULATION: 

TITLE  I 

GENERAL  PROVISIONS 

CHAPTER  I 

FORMATION  OF  THE  EUROPEAN  MUTU 

Article 1 

(Form of the European mutual  socie 

1.  (AMENDMENT No 164/corr, modifie 

Mutual  societies may be formed th: 

European provident  mutual  society ox.  a. cuiupeaa mutual  Knc,>  ueniymy  uut 
other activities on the conditions and  in the manner  set out  in this 
Regulation. The name of an ME  shall specify the nature of the activity 
engaged  in, indicating whether,  for example,  it is an insurance activity or 
purely a providence  activity. 

2. An ME: 

-  shall guarantee  its members,  in return  for a subscription,  full  settlement 
of contractual  undertakings entered  into in the course of the activities 
authorized  by  its statutes; and 

(AMENDMENT No 100, modified) 

-  shall not remunerate  its managers or administrators,  or assign them a share 
of the operating  surplus. However, managers and administrators may be 
reimbursed  for expenses  incurred  in performing  their duties. 

3. An ME shall operate with a formation  fund  and reserves which  shall  serve 
exclusively  to cover  its debts. 

4. An ME shall  have legal personality.  It shall acquire  it on the day of  its 
registration  in the Member  State  in which  it has its registered  office, in 
the register designated  by that  State  in accordance with Article 8 (3). 

(14) 
(15) 
(16) 

OJ No L 372, 31.12.1986, p. 1. 
OJ No L 386, 30.12.1989, p. 1. 
COM(90) 348 final - SYN 291. 

S3 
5. This Regulation does not prejudice the competence of each Member State to 
regulate access on its territory  to the management of basic obligatory  social 
security  schemes as well as the operations of provident or assistance 
organizations the services of which will vary according to available 
resources and in which the contributions of members  is determined by 
contract, as well as the carrying out of the activities and operations. 

Article 2 

(Formation) 

(AMENDMENT No 102) 

1. An ME may be formed by: 

(a) any two or more of the legal entities essentially  pursuing  activities 
other than providence which are listed  in Annex  1 which are formed under the 
law of a Member State provided at least two of them have their registered 
office and central administration  in different Member States; 

(b) or any two or more of the legal entities which are listed  in Annex 2 and 
which are formed under the law of a Member State provided that at least two 
of them have their registered office and central administration  in different 
Member States and that they solely pursue providence activities as defined in 
the Member States of origin of the founding entities; 

c) or at least 500 natural persons resident  in at least two Member  States 
where the ME is essentially  carrying on activities other than providence. 

(AMENDMENT  No 103, modified) 

2. A mutual society which has been formed  in accordance with the law of a 
Member State and has its registered office and central administration  in the 
Community may  form an ME by converting  into ME  form if it has at least 500 
members in another Member State and is carrying on genuine and effective 
activities there or can demonstrate that  it will meet the above twofold 
condition  if it changes form. 

Such conversion shall not result  in the society being wound up or in the 
creation of a new legal person. 

The administrative or management board of  such a society  shall draw up a 
proposal  for conversion covering the legal and economic  aspects of the 
conversion. 

The conversion to ME form and the ME's statutes shall be approved  by the 
general meeting of members  in accordance with the requirements  laid down for 
amendment of  its statutes by Article 22. 

Article 3 

(The statutes of the ME) 

1. The statutes of the ME must  include: 

- the name of the ME, specifying  the nature of the activity engaged  in, and 

preceded or followed by the abbreviation  *ME', 

- a precise statement of the objects of the ME, 

So 

91 

-  the name, objects and registered offices of the founder members, where 

these are legal entities; 

- the address of the ME's registered office; 

-  the conditions and procedures for the admission, expulsion and  resignation 

of members, 

- the rights and obligations of members and of the ME, 

- the subscriptions payable by natural or  legal persons, and, where 

appropriate, provisions as to arrears, 

- the management structure, 

- the powers and responsibilities of each of the governing bodies of the ME, 

- provisions governing the appointment and removal of the members of the 

governing bodies, 

- the majority and quorum requirements, 

-  a definition of the governing bodies, or members of those bodies, having 

authority to represent the ME in dealings with third parties, 

- the conditions for the initiation of proceedings on behalf of the ME under 

Article 42, 

- the grounds for winding up. 

2. For the purposes of this Regulation the  'statutes' of the ME comprise both 
the instrument of incorporation  and, where they are set out in a separate 
document, the ME's statutes properly  so-called. 

3. For the purposes of this Regulation  a  'member' of any ME means any legal 
person who took part  in the foundation of the ME or who acquired membership 
later. 

Article 4 

(Formation  fund) 

1. The  formation  fund shall be not  less than ECU  100 000 or the equivalent in 
national currency. 

2. Where the law of a Member State requires a higher amount  in the case of 
mutual societies engaged  in certain types of activity, the same requirement 
shall apply to MEs which have their registered  office  in that State. 

Article 5 

(Registered  office) 

The registered office of an ME shall be situated within the Community  in the 
Member State in which the ME has  its central  administration. 

Article 6 

(Transfer of registered  office) 

92, 

1. The registered  office of an ME may be transferred  to another Member  State 
in accordance with paragraphs 2 to 9 below.  Such transfer  shall not  result 
in the ME being wound up or  in the creation of a new  legal person. 

2. A transfer proposal  shall be drawn up by the management  or  administrative 
board and be published  in accordance with Article 9, without  prejudice to any 
additional  form of publicity  provided  for by the Member  State in which the 
registered  office  is situated.  This proposal  shall  include details of: 

a)  the registered office proposed  for the ME, 
b)  the statutes proposed  for the ME  including, where appropriate,  its new 

title, 

c)  the timetable proposed  for the transfer. 

2(a) The management  or administrative  board  shall draw up a report  explaining 
and  justifying  the legal and economic  aspects of the transfer  for the 
attention, of members  and workers. 

2(b) The members and creditors of the ME shall, at  least one month prior to 
the general meeting called to decide on the transfer,  have the right to 
examine, at the registered  office of the ME, the transfer proposal  and the 
report drawn up by virtue of 2(a) and to obtain  copies of these documents 
free of charge on request. 

2(c) A Member  State may,  in respect  of MEs registered  on  its territory, adopt 
provisions to ensure appropriate protection  for members  in the minority who 
voted against  the transfer. 

3. No decision to transfer may be taken  for two months after publication of 
the proposal.  Any  such decision must  be governed  by the conditions  laid down 
for the amendment  of the statutes. 

4. The creditors and holders of other  rights vis-à-vis the ME which predated 
publication of the transfer proposal may  require the ME to constitute an 
appropriate guarantee  in their  favour.  Exercise of this right  shall be 
governed  by national  law  in the State  in which  the ME  had  its registered 
office prior to transfer. 

A Member  State may extend  the application  of the above provision  to  include 
debts made by the ME with public entities prior  to the date of transfer. 

5. In the Member  State  in which  the ME has  its registered  office, a court, 
notary or other competent  authority  shall  issue a certificate to the effect 
that  the acts and  formalities  required  prior  to transfer  have been  properly 
completed. 

6. The new registration may  not be effected  until  the certificate  provided 
for  in  (5) has been produced  and evidence  has been  furnished  of completion of 
the  formalities  required  for registration  in the country  of the ME's new 
registered  office. 

93 
6(a) Transfer of the ME's registered  office and the resulting  change of 
statutes shall take effect on the date on which the ME  is registered  in the 
register  for its new registered  office,  in accordance with Article 8. 

7. The removal of the ME from the register  for its previous  registered  office 
may  not be effected until evidence has been produced that the ME has been 
registered  in the register for its new registered office. 

8. The  fact of the new registration  and the fact of the removal of the old 
registration  shall both be published  in the Member  States concerned,  in 
accordance with Article 9. 

9. The new registration of the registered  office of the ME may be relied on 
as against  third parties  from publication.  However, until the removal of the 
ME  from the register  for its previous registered  office has been  published 
third parties may continue to rely on the old  registered  office unless the ME 
proves that  such third parties were aware of the new registered office. 

10. A Member  State's legislation may,  in respect of MEs registered  in that 
country, provide for any transfer of registered office giving rise to a 
change in the applicable  law not to take effect where, within the period of 
two months specified  in  (3), a competent  authority  from that  country  lodges 
an objection.  Such objection may only be  lodged  for reasons of public 
interest.  It must be possible to appeal  against  any  such ruling to a 
judicial body. 

11. An ME which  is the subject of winding-up,  liquidation,  insolvency, 
suspension of payments or other  such procedures may  not transfer  its 
registered office. 

Article 7 

(Applicable  law) 

1. An ME shall be governed: 

(AMENDMENT,  aligned with European Company  terms) 

(a) - by the provisions of this Regulation, 

(b) - where expressly  authorized by this Regulation, by the provisions  in the 

statutes of the ME; 

c) - for matters not dealt with by this Regulation or, where a matter  is 
dealt with only partially,  for the aspects not covered by this Regulation: 

- the  legal provisions adopted by the Member  States  in application of 

Community  measures dealing  specifically  with MEs; 

- the  legal provisions  in Member States applying  to the  legal entities set 
out  in the.Annex and constituted  in conformity  with the  legislation of 
the Member  State  in which the ME has its registered office; 

- the provisions of statutes under the same conditions as for the legal 
entities set out  in the Annex  and constituted  in accordance with the 
legislation of the Member State  in which  the ME has  its registered 
office. 

2.  (AMENDMENT,  aligned with European  Company) 

9^ 
Where a State comprises several territorial units, each of which has its own 
rules of law applicable to the matters referred to in paragraph 1, each 
territorial unit shall be considered a State for the purposes of identifying 
the law applicable under this paragraph. 

3. In each Member  State and subject to the express provisions of this 
Regulation, an ME shall have the same rights, powers and obligations as a 
mutual  society  formed under the law of the State  in which the ME has its 
registered office. 

3s 

Article 8 

(Registration and disclosure  requirements) 

1. The founder members shall draw up the statutes of the ME in accordance 
with the provisions for the formation of mutual  societies  laid down by the 
law of the State in which the ME has its registered office. The statutes must 
at  least be in writing and signed by the founder members. 

2.  In those Member States whose  legislation does not provide  for any 
precautionary  supervision, whether administrative  or  judicial, at the time of 
formation, the statutes shall be adopted  by notarial act. The  supervisory 
authority  shall seek to ensure that this act complies with the requirements 
for the formation of an ME, and  in particular  those set out  in Articles  1, 2, 
3 and 5. 

3. Member States shall designate the register  in which MEs must  be registered 
and shall determine the rules governing  it. They shall  lay down the 
procedures  for filing the ME's statutes. No ME may be registered  until the 
measures required by the Directive  (supplementing  the statute for a European 
mutual  society with regard to the involvement  of employees) have been 
adopted. 

4. Member  States shall take the measures required  to ensure that  the 
following documents and particulars are disclosed  as provided  for in 
paragraph 3: 

(a) the statutes of the ME, any amendments  to them, and the complete text of 
the statutes in its up-to-date  form; 

(b) the opening or closing of any  establishment; 

(c) the appointment, termination of office and particulars of the persons who 
either as a body constituted  pursuant to law or as members of any such body: 

- are authorized to represent the ME  in dealings with third parties and in 
legal proceedings, 

- take part  in the administration, supervision or control of the ME; 

(d) at least once a year, the amount of the  formation  fund, unless any 
increase in the formation  fund requires an amendment to the rules; 

(e) the balance sheet and the profit and  loss account  for each  financial 
year; the .document containing the balance sheet shall give particulars of the 
persons who are required by  law to certify  it; 

(f) any proposal to transfer the registered office as referred to in Article 
6 (2); 

96 

(g) the winding-up and  liquidation  of the ME and the decision to continue the 
ME's activities taken under Article 49; 

(h) any declaration of nullity of the ME by a court; 

(i) the appointment  of liquidators, particulars of such  liquidators, and 
their respective powers, the termination of their office; 

(j) the conclusion of the liquidation  of the ME and the removal of the ME 
from the register. 

5. If, prior to its acquisition of  legal personality,  steps have been taken 
in the name of an ME, and the ME does not assume the obligations arising  from 
those steps, the persons who took them shall be jointly and  severally  liable 
therefor, unless otherwise  agreed. 

Article 9 

(Publication of documents and particulars  relating to the ME  in the Member 
States) 

1. Member States shall ensure that the documents and particulars referred to 
in Article 8  (4) are disclosed  in the appropriate official gazette in 
the Member  State in which the ME has its registered office, and shall 
determine by which persons the disclosure  formalities are to be carried out. 
Disclosure shall be effected by publication  either of an extract or of a 
reference to the entry  in the register. 

Member  States shall also ensure that anyone may consult  the documents 
referred to in Article 8  (4) in the register  referred  to in Article 8 (3), 
and may obtain a copy of the whole or any part, by post  if  requested. 

Member  States shall take the necessary measures to avoid  any discrepancy 
between what  is disclosed  by publication  and what  appears  in the register. 
However,  in cases of discrepancy,  the text  published may not be relied on as 
against  third parties; the latter may  nevertheless rely thereon, unless the 
ME proves that they had knowledge of the text  entered  in the register. 

Member  States may require payment  of a fee for the services referred  to in 
the preceding  subparagraphs, but the  fee may  not exceed  the  administrative 
cost. 

2. The national  rules adopted pursuant  to Directive 89/666/EEC shall apply to 
branches of a ME opened  in a Member  State other  than that  in which  it has its 
registered office. 

3. Documents and particulars may  be relied  on by the ME as against  third 
parties only after they  have been disclosed  in accordance with paragraph 1, 
unless the ME proves that  the third party  had  knowledge thereof. However, 
they may not be relied on  in respect  of transactions which  take place before 
the  16th day after publication  as against  third  parties who prove that they 
could  not have had knowledge  thereof. 

4. Third  parties may  rely on any documents and particulars  in respect of 
which  the disclosure  formalities  have not  yet  been completed,  save where non 
disclosure causes them not  to have effect. 

Article 10 

(Notice in the Official Journal) 

9} 

Member States shall ensure that a notice stating that an ME has been 
registered or that the liquidation of an ME has been concluded is published 
for information purposes in the Official Journal of the European Communities, 
stating the number, date and place of registration of the ME, the date and 
place of publication and the title of the publication, the address of the ME 
and a summary of its objects, and that these particulars are forwarded to the 
Office for Official Publications of the European Communities within one month 
of the date of the publication in the official gazette of the Member State in 
which the ME has its registered office pursuant to Article 9 (1). 

Where the registered office of the ME is transferred in accordance with 
Article 6 (2) a notice shall be published containing the information provided 
for in the first paragraph, together with that relating to the new 
registration. 

Article 11 

(Particulars to be stated in the ME*s documents) 

Letters and documents sent to third parties shall state legibly: 

(a) the name of the ME, preceded or followed by the abbreviation  'ME'; 

(b) the place of the register in which the ME is registered in accordance 
with Article 8 (3), and the number of the ME*s entry in that register; 

(c) the address of the ME's registered office; 

(d) the fact that the ME is in liquidation or under the administration of the 
courts if that is so. 

CHAPTER  II 

GENERAL  MEETING 

Article 12 

(Competence) 

The general meeting shall decide oh: 

(a) matters for which it has sole responsibility under this Regulation; 

(b) matters for which the management board, supervisory board or 
administrative board do not have sole responsibility as a result of: 

- this Regulation, 

9% 

- Directive  . . . (supplementing  the Statute  for a European mutual  society 
with regard to the involvement  of  employees), 

- the law of the State where the ME has  its registered  office, 

- the statutes of the ME. 

Article 13 

(Holding of general meeting) 

1. A general meeting shall be held at  least once a year, not  later than six 
months after the end of the ME's financial  year. 

2. General meetings may be convened  at any  time by the management  board or 
the administrative  board. The management  board  is bound  to convene the 
general meeting  at the request of the supervisory  board. 

3. The agenda  for the general meeting  held after the end of the financial 
year shall  include at least the approval of the annual accounts and of the 
appropriation of the profit or treatment  of the loss and the approval of the 
annual report  referred to in Article 46 of Directive 78/660/EEC, to be 
submitted by the management  or administrative  board. 

4. The statutes of an ME with a management  board and a supervisory  board may 
provide that a decision on approval of the annual accounts  is to be taken 
jointly by the two boards, in separate votes, and that the general meeting is 
to pass a resolution only  if the boards are unable to reach agreement. 

Article 14 

(Meeting called by a minority of  members) 

1. Not  less than 25% of the members of the ME, which proportion may be 
reduced by the statutes, may request  that the general meeting be convened and 
its agenda set. 

2. The request  for a meeting  shall give the reasons for convening  it and the 
items to be included on the agenda. 

3. If, following a request made under paragraph  1, the necessary  steps have 
not been taken within one month, the court or competent authority within the 
State where the ME's registered office  is situated may order the convening of 
a general meeting or authorize either  the members who have requested  it or 
their representative to convene the meeting. 

4. A general meeting may during a meeting decide that a  further meeting be 
convened  and set the date and the agenda. 

93 

Article 15 

(Notice of meeting) 

1. The general meeting shall be convened: 
- by a notice published in the national gazette appointed by the Member State 
in which the ME has its registered office in accordance with Article 3 (4) of 
Directive 68/151/EEC, 

- by a notice published in one or more newspapers with a large circulation in 
the Member States, 

- or by a notice in writing sent to every member of the ME by any available 
means. 

2. The notice calling the general meeting shall contain the following 
particulars, at least: 

- the name and the registered office of the ME, 

- the place and date of the meeting, 

- the type of general meeting (ordinary, extraordinary or special), 

- a statement of the formalities, if any, prescribed by the rules for 
attendance at the general meeting and for the exercise of the right to vote, 

- the agenda, showing the subjects to be discussed and the proposals for 
resolutions. 

3. The period between the date of publication of the notice or the date of 
dispatch of the communication referred to in paragraph 1 and the date of the 
opening of the general meeting shall be not less than 30 days. 

Article 16 

(Addition of items to the agenda) 

Not less than 25 % of the members of the ME, which proportion may be reduced 
by the statutes, may, within ten days of receipt of the notice convening a 
general meeting, request the addition of one or more items to the agenda. 

Article 17 

(Attendance and proxies) 

1. Only members shall be entitled to speak and vote at the general meeting. 

2. Persons entitled to vote shall be entitled to appoint a proxy to represent 
them at the general meeting in accordance with procedures to be laid down in 
the statutes. 

3. The statutes may permit postal voting, in which case they shall lay down 
the necessary procedures. 

lot) 

Article  18 

(Sectional  meetings) 

(AMENDMENT No 105) 

1. The general meeting shall consist either of all the members or of 
delegates appointed under the conditions  laid down  in the statutes. 

2. Where the ME has several establishments, or where  its activities  span more 
than one region, or where it has more than 500 members,  the statutes may 
provide  for the holding of sectional meetings to consider the same agenda 
separately before the general meeting  is held. These meetings shall elect 
delegates, who shall  in their turn be convened  as the general meeting. The 
statutes shall  lay down the division  into sections, the number of delegates 
for each section, and the procedures to be  followed. 

3. Persons entitled  to attend  the general meeting may appoint  a proxy to 
deputize  for them under the conditions  laid down  in the statutes. 

4. The statutes may permit postal voting,  in which case they  shall  lay down 
the necessary  procedures. 

Article 19 

(Right to  information) 

All members of the ME shall have an equal right of access to information both 
before and at general meetings. 

This  information  shall be made available to members  at the ME's registered 
office at  least one month before the holding of the meeting. 

In particular, before the general meeting  that  follows the end of the 
financial year, members may examine any accounting documents that must be 
drawn up in accordance with the national measures adopted  pursuant  to 
Directives  78/660/EEC and 83/349/EEC. 

Article 20 

(Voting  rights) 

(AMENDMENT  No 106, modified) 

Each member of the ME shall have one vote. If an ME has been  formed by legal 
persons,  its statutes may regulate voting  rights according  to the number of 
members  and the activities of each  legal person who  is a member. The statutes 
must  restrict  the representation rights of  legal persons  in order to prevent 
any one  legal person  from enjoying  an absolute majority of votes. 

Article 21 

(AMENDMENT  No 107) 

The statutes may  allow members  to have more than one vote. The  statutes 
shall,  in that  event,  lay down  the circumstances  in which  a member may have 
more than one vote; this must  depend  on the extent  to which  the member  takes 

part  in the ME's activities. The statutes must  lay down  limits on the number 
of votes which may be cast by a single member  and the number  of other  members 
for whom a member may act as proxy. 

Article 22 

(Normal majority) 

Except where this Regulation or the statutes  lay down majority  requirements, 
decisions of the general meeting  shall be taken by a majority of the votes of 
the members present or  represented. 

Article 23 

(Special majority) 

The general meeting shall have sole power to amend the statutes of the ME; 
any such resolution shall be passed  by a majority  of two'thirds of the votes 
of the members present or  represented. 

A Member  State may provide that the management  or administrative  board  is to 
amend the statutes where  it is ordered  to do so by a court or  administrative 
authority whose authorization  is required  for amendments  to the statutes. 

Amendments  to the statutes shall be published  in accordance with the 
provisions of Article 9. 

Article 24 

(Actions to have resolutions of general meeting declared  void) 

Resolutions of the general meeting may  be declared  void on the grounds that 
they  infringe this Regulation or the statutes of the ME  in the  following 
manner: 

- an action for such a declaration may  be brought  by any member  provided he 
can show that he has an interest  in having  the  infringed  provision  observed, 

- the action  for such a declaration  shall be brought  within three months, 
before the court within whose  jurisdiction  the ME has its registered office; 
the procedure  in the action  shall be governed  by the law of the State in 
which the ME has its registered  office, 

- having  heard the ME, the court may  suspend  application  of the contested 
resolution;  it may also require the applicant  to lodge security  for the 
damage which may  result  from the suspension of application of the resolution, 
if the application  is ultimately dismissed  as  inadmissible or unfounded; 
judgments declaring  a resolution  void or ordering  that  its application be 
suspended  shall be effective erga omnes, without  prejudice to claims on the 
ME acquired  in good  faith by third  parties. 

Article 25 

(Disclosure of decisions of a court) 

Decisions of a court declaring  a resolution  of  the general  meeting  void or 
non-existent  shall be the subject  of disclosure  in accordance with Article 9. 

CHAPTER  III 

MANAGEMENT,  SUPERVISORY  AND  ADMINISTRATIVE  BODIES 

Article 26 

(Structure) 

-7o3 

Under the conditions  laid down by this Regulation  the statutes of the ME 
shall organize the structure of the ME either  according  to a two-tier  system 
(management board and supervisory  board) or according  to a one-tier  system 
(administrative  board); a Member State may, however, require that MEs having 
their registered office in its territory  adopt either the two-tier or the 
one-tier  system as it shall determine. 

Section I 

Two-tier  system 

Subsection 1 

Management  board 

Article 27 

(Functions of the management board; appointment  of members) 

1. The management board  shall manage the ME. The member or members of the 
management board  shall have the power  to represent  the ME  in dealings with 
third parties and  in legal proceedings  in accordance with the measures 
adopted pursuant to Directive  68/151/EEC by the Member  State  in which the ME 
has its registered office. 

2. The member or members of the management  board  shall be appointed  and 
removed by the supervisory board. 

3. No person may at the same time be a member of the management board  and of 
the supervisory  board. 

However, the supervisory  board may  nominate one of  its members to exercise 
the function of member of the management  board  in the event of a vacancy. 
During  such a period the function of the person concerned  as member of the 
supervisory  board  shall be suspended. 

4. The number of members of the management  board  shall be  laid down  in the 
statutes of the ME. 

Article 28 

(Chairmanship, convening of meetings) 

1. The statutes may provide that  the management  board  is to elect  a chairman 
from among  its members. 

2. Meetings of the management  board  shall  be convened  in accordance with the 
statutes of the ME or the rules of procedure of the board.  In any event any 
member of the board may  convene a meeting  where urgency  requires, stating his 
reasons. 

Subsection 2 

Supervisory board 

Article 29 

(Functions of the supervisory  board; appointment of members) 

1. The supervisory board shall supervise the duties performed  by the 
management board. It may not itself exercise the power to manage the ME. The 
supervisory  board may not represent the ME  in dealings with third parties. It 
shall represent the ME in dealings with members of the management board, or 
one of them,  in respect of litigation or the conclusion of contracts. 

(AMENDMENT No 108, modified) 

2. With the exception of the employees' representatives  pursuant to Directive 
.../.../EEC, the members of the supervisory  board  shall be appointed and 
removed by the general meeting. However, the members of the first  supervisory 
board may be appointed  in the statutes. This provision  shall apply without 
prejudice to nationa^ law permitting  a minority of shareholders to appoint 
some of the members of a board. 

3. The number of members of the supervisory  board  shall be laid down  in the 
statutes. A Member State may, however, stipulate the number of members of the 
supervisory  board  for MEs registered  in its territory. 

Article 30 

(Right to  information) 

1. The management board  shall report  to the supervisory  board at  least once 
every three months on the state and  foreseeable prospects of the ME's 
affairs, taking particular account of any  information  relating  to 
undertakings controlled by the ME that may  significantly affect those 
affairs. 

2. The management  board  shall communicate to the supervisory  board without 
delay any  information which may have an appreciable effect on the ME. 

3. The supervisory  board may at any time require the management board to 
provide  information or a special report on any matter  concerning  the ME. 

4. The supervisory  board may undertake all  investigations  necessary  for the 
performance of  its duties. It may appoint one or more of  its members to carry 
out this task and may call in the help of experts. 

5. Each member of the supervisory  board  shall  be entitled  to examine all 
information  communicated  by the management  board  to the supervisory  board. 

Article 31 

(Chairmanship, calling of meetings) 

1. The supervisory  board  shall elect  a chairman  from among  its members. 

A or 
2. The chairman shall convene a meeting  of the supervisory  board under the 
conditions  laid down in the statutes, on his own  initiative, or at the 
request of at least one third of the members of the supervisory  board, or at 
the request of the management board. The request must  indicate the reasons 
for calling the meeting. If no action has been taken  in respect of such a 
request within  fifteen days the meeting of the supervisory  board may be 
called by those who made the request. 

Section II 

The one-tier  system 

Article 32 

(Functions of the administrative board; appointment of members) 

1. The administrative board  shall manage the ME. The member or members of the 
administrative board  shall have the power to represent  the ME  in dealings 
with third parties and  in legal proceedings  in accordance with the measures 
adopted pursuant to Directive 68/151/EEC by the Member  State in which the ME 
has its registered office. 

2. The administrative board  shall have at  least three members within limits 
fixed by the statutes. 

3. The administrative board may delegate to one or more of  its members the 
power of management. It may also delegate certain management  responsibilities 
to one or more persons not members of the board; such management 
responsibilities may be revoked  at any time. The statutes, or if the statutes 
are silent the general meeting, shall  lay down the conditions within which 
such delegation  shall operate. 

4.  (AMENDMENT No 109, modified) 

With the exception of the employees'  representatives pursuant to Directive 
.../.../EEC, the member or members of  the administrative  board  shall be 
appointed  and removed by the general meeting. 

Article 33 

(Holding of meetings and right  to  information) 

1. The management  board  shall meet  at  least once every  three months, at 
intervals  laid down by the statutes to discuss the progress and  foreseeable 
prospects of the ME's affairs, taking  particular  account of any  information 
relating  to undertakings controlled  by the ME that may  significantly affect 
the progress of the ME. 

2. The administrative board  shall meet  to deliberate on the operations" 
referred  to in Article 38. 

3. Each member of the administrative board  shall be entitled  to examine all 
reports, documents and  information  supplied  to the board  concerning  the 
matters  referred  to in paragraph  1. 

-IDG 

Article 34 

(Chairmanship, calling of meetings) 

1. The administrative board  shall elect  a chairman  from among  its members. 
2. The chairman  shall convene a meeting  of the administrative board under the 
conditions  laid down in the statutes, either on his own initiative or at the 
request of at least one-third  of the members. The request must  indicate the 
reasons for calling the meeting. If the request  is not satisfied  within 
fifteen days, the meeting of the administrative board may be called by those 
who made the request. 

Section III 

Rules common to the one-tier and two-tier board  systems 

Article 35 

(Term of office) 

1. Members of the governing  bodies shall be appointed  for a period  laid down 
in the statutes not exceeding  six years. 

2. Board members may be reappointed  one or more times for the period  laid 
down in accordance with paragraph  1. 

Article 36 

(Conditions of membership) 

1. A mutual society which  is a member of a board  shall designate a natural 
person as its representative to exercise  its functions on the board  in 
question. The representative  shall be subject to the same conditions and 
obligations as if he were personally  a member of the board. 

2. No person may be a member of a management, supervisory or  administrative 
board  nor a representative of a member within  the meaning of paragraph  1, nor 
have conferred  on him powers of management  or representation, who: 

- under the  law applicable to him, or 

- under the law of the State  in which  the ME has  its registered  office, or 

- as a result of a judicial or administrative decision delivered  or 
recognized  in a Member State, 

is disqualified  from serving on the management, supervisory  or  administrative 
board of any  legal person. 

Article 37 

(Rules of  procedure) 

•no^ 

Each governing body may draw up rules of procedure under the conditions laid 
down by the statutes of the ME. Any member of the ME or competent  authority 
may consult those rules of procedure at the registered  office of the ME. 

Article  38 

(Power of representation; liability  of the ME) 

1. Where the authority to represent  the ME  in dealings with third parties, in 
accordance with Articles 26  (1) and  31  (1), is conferred  on two or more 
members of governing bodies, those persons shall exercise that  authority 
collectively. 

2. However, the statutes of the ME may provide that the ME shall be validly 
bound either by each of the members acting  individually  or by two or more of 
them acting  jointly. Such a clause may be relied upon against third parties 
where it has been disclosed  in accordance with Article 9. 

3. Acts performed by members of the governing  bodies of the ME shall bind the 
ME vis-à-vis third parties, even where the acts in question are not in 
accordance with the objects of the ME, providing  they do not exceed the 
powers conferred on them by  law or which the  law allows to be conferred on 
them. 

However, Member States may provide that the ME shall not be bound where such 
acts are outside the objects of the ME  if  it proves that the third party knew 
that the act was outside those objects or could not  in view of the 
circumstances have been unaware of  it; disclosure of the statutes shall not 
of  itself be sufficient proof thereof. 

4. The appointment, termination of office and particulars of the persons who 
may  represent an ME must be disclosed  in accordance with Article 9. The 
information disclosed must state whether these persons are authorized  to bind 
the ME  individually or whether they must act  jointly. 

Article 39 

(Operations requiring  authorization) 

1. The statutes of the SCE shall  set out the categories of operation 
requiring  authorization  for the administrative  board  by the  supervisory 
board, under the two-tier  system, or  requiring  an express decision  from the 
administrative  board under the one-tier  system. 

However, a Member State may  provide that, under  the two-tier  system, the 
supervisory  board may  itself make certain categories of operation  subject to 
authorization. 

2. A Member State may  lay down the minimum  categories of operation which must 
feature  in the statutes of SCEs registered  on  its territory. 

Article 40 

(Rights and  obligations) 

1o3 

1. Within the scope of the functions attributed  to them by this Regulation, 
each of the members of a board  shall have the same rights and obligations as 
the other members of the board of which he is a member. 

2. All board members shall carry out their  functions  in the interests of the 
ME, having  regard  in particular  to the  interests of the members and the 
employees. 

3. All board members shall exercise a proper discretion, even after they have 
ceased  to hold office, in respect of  information of a confidential  nature 
concerning the ME. 

Article 41 

(Conduct of business on boards) 

1. Boards of the ME shall conduct business under the conditions and  in the 
manner  set out  in the statutes of the ME. 

£»•Where these statutes are silent, a board  shall not conduct business validly 

unless at  least half of  its members are present  at the discussions. Decisions 
shall be taken by majority of the votes of the members present or 
represented. 

>. The chairman of each board  shall have a casting vote in the event of a 
tie. 

Article 42 

(Civil  liability) 

1. Members of the management, supervisory  or administrative board  shall be 
liable for  loss or damage sustained  by the ME as a result of breach of the 
obligations attached to their functions. 

2. Where the board concerned  is composed  of more than one member, all the 
members shall be jointly and severally  liable  for loss or damage sustained by 
the ME; however, a member may be relieved  of  liability  if he can prove that 
he  is not  in breach of the obligations  attached  to his functions. 

Article 43 

(Proceedings on behalf of the ME) 

1. The general meeting, by a majority  of  the votes of the members present or 
represented,  shall take the decision  to  initiate proceedings,  in the name and 
on behalf of the ME, to establish  liability  pursuant  to Article 40 (1). 

The general meeting  shall appoint  a special  representative to conduct the 
action. 

2. Not  less than one-fifth of the members may  likewise decide to  initiate 
proceedings to establish  liability  in the name and on behalf of the ME. They 
shall appoint a special representative  to conduct  the action. 

io3 

Article 44 

(Limitation of actions) 

No proceedings on the ME's behalf to establish  liability may be  initiated 
more than five years after the act giving  rise to loss or damage. 

CHAPTER  IV 

FINANCING,  ANNUAL  ACCOUNTS,  CONSOLIDATED  ACCOUNTS,  AUDITING  AND 
DISCLOSURE 

Article 45 

(Financing) 

An ME may avail  itself of all forms of  financing under the most  favourable 
conditions applying to mutual societies  in the State in which  it has its 
registered  office and  in the Member States  in which  it has its 
establishments. 

Article 46 

(Preparation of annual accounts and consolidated  accounts) 

1. For the purposes of drawing  up  its annual  accounts and  its consolidated 
accounts  if any, including the annual  report  accompanying  them and their 
auditing  and disclosure, the ME shall be subject to the measures adopted  in 
the State in which  it has its registered  office under Directives  78/660/EEC 
and 83/349/EEC. 

2. The ME may draw up its annual accounts, and  its consolidated  accounts if 
any, in ecus.  In this event, the bases of conversion used to express  in ecus 
those items included  in the accounts which are or were originally  expressed 
in another currency must be disclosed  in the notes to the accounts. 

Article 47 

(Auditing) 

The annual accounts of the ME, and  its consolidated  accounts  if any, shall be 
audited by one or more persons authorized  to do so in the Member State in 
which the ME has  its registered  office  in accordance with the measures 
adopted  in that State pursuant  to Directives  84/253/EEC and 89/48/EEC. Those 
persons shall also verify  that the annual  report  is consistent with the 
annual accounts, and the consolidated  accounts  if any,  for the same  financial 
year. 

_ -rt» - > H-

Article 48 

(Disclosure of  accounts) 

1. The annual accounts, the consolidated  accounts if any, duly approved, and 
the annual report and audit report shall be disclosed  in accordance with the 
measures adopted by the Member State in which the ME has its registered 
office pursuant to Article 3 of Directive 68/151/EEC. 

2. Where MEs are not subject, under the law of the Member State in which the 
ME has its registered office, to a disclosure requirement  as provided  for in 
Article 3 of Directive 68/151/EEC, the ME must at least make the accounting 
documents available to the public at its registered office. Copies of these 
documents must be obtainable on request. The price charged  for these copies 
must not exceed the administrative cost. 

Article 49 

(Credit or financial  institutions and  insurance  undertakings) 

MEs which are credit or financial  institutions or insurance  undertakings 
shall comply, as regards the drawing-up, auditing and disclosure of annual 
accounts and consolidated  accounts, with the rules laid down by the measures 
adopted  in the Member State in which the ME has its registered  office 
pursuant to Directive 86/636/EEC or, as the case may be, pursuant to Council 
Directive  91/674/EEC<17). 

CHAPTER  V 

WINDING  UP  AND  LIQUIDATION 

Section I 

Winding up 

Article 50 

(Winding up by the general meeting) 

1. An ME may be wound up by a decision of the general meeting ordering  its 
winding up, taken  in accordance with the rules laid down  in the first 
paragraph of Article 22. 

However, the general meeting may decide  in accordance with the same rules, to 
annul the decision to wind up, as long as there has been no distribution on 
the basis of the liquidation. 

2. The management or administrative board must convene a general meeting to 
take a decision on the winding up of the ME: 

- where the period  fixed in the statutes has expired, 

- where the subscribed  formation  fund has been reduced below the minimum  laid 
down  in the statutes, 

- where the disclosure of accounts has not taken place  in the ME*s last three 
financial years, 

- where the number of members is below the minimum  required  by this 
Regulation or by the ME's statutes, 

(17) 

OJ No L 

nij, 
- on any grounds  laid down either  in the  law governing  the  legal entities 
which  founded the ME,  in the State  in which  the ME has  its registered office, 
or  in the statutes. 

(AMENDMENT  No 111) 

The general meeting  shall decide either to wind  up the ME or that the ME 
shall continue  its activities  in accordance with Article 22. 

Article  51 

(Winding up by the court) 

On an application  by any person concerned  or any competent  authority,  the 
court of the place where the ME has its registered  office must order  it to be 
wound up where  it finds that the registered  office has been transferred 
outside the Community,  or that  the ME's activities are being  carried on 
contrary  to public policy  in the Member  State  in which the ME has its 
registered  office, or  in breach of Articles  1, 2  (1) or 4. 

The court may grant the ME a period of time to rectify the situation.  If it 
fails to do so within the time allowed  the court  shall order  it to be wound 
up. 

Section II 

Liquidation 

Article 52 

(Liquidation) 

1. The winding  up of an ME shall  entail  its  liquidation. 

2. The  liquidation  of an ME and the conclusion  of  its  liquidation  shall be 
governed  by the  law of the State  in which  it has  its registered  office. 

3. An ME  in liquidation  shall continue to have  legal personality  until the 
conclusion  of the  liquidation. 

4. Following the liquidation,  the books and  records relating  to the 
liquidation  shall be lodged  at the register  referred  to  in Article  8  (3). Any 
interested  party may examine such books and records. 

Article 53 

(Distribution) 

After  the creditors have been paid  in full, and  anything  due to beneficiaries 
designated  in the rules has been distributed,  the assets of the ME shall, 
except where otherwise stated  in the statutes, be distributed  by decision of 
the general meeting  either to other MEs or mutual  societies governed  by the 
law of a Member State or to one or more bodies having  as their object  the 
support  and promotion of mutual societies. 

-til-  S<1-

CHAPTER  VI 

INSOLVENCY  AND  SUSPENSION  OF  PAYMENTS 

Article 54 

(Insolvency  and  suspension of  payments) 

1. The ME shall be1 subject to the law of the State  in which  it has its 
registered  office in respect of  insolvency  and supension of payments. 

2. The opening of insolvency or suspension of payment  proceedings shall be 
notified  by the person appointed to conduct  the proceedings  for entry  in the 
register  referred to in Article 8  (3). The entry  in the register  shall show 
the  following: 

(a) the nature of the proceedings, the date of the order, and the court 
making  it; 

(b) the date on which payments were suspended,  if the court order provides 
for this;. 

(c) the name and address of the administrator,  trustee,  receiver,  liquidator 
or any other person having power to conduct  the proceedings, or of each of 
them where there are more than one; 

(d) any other  information considered  necessary. 

3. Where a court  finally dismisses an application  for the opening of the 
proceedings referred to in paragraph  2 owing to want of sufficient  assets, it 
shall, either of  its own motion or on application by any  interested  party, 
order  its decision to be noted  in the register referred  to in Article 8 (1). 

4. Particulars registered pursuant to paragraphs 2 and  3 shall be disclosed 
in the manner  referred to in Article  9. 

TITLE  II 

FINAL  PROVISIONS 

Article 55 

(Measures to be applied  in the event of a breach of  rules) 

Each Member  State shall specify  the appropriate measures  to be imposed  in the 
case of breach of the provisions of this Regulation  and, where appropriate, 
of any relevant  national measures; the penalties must  be effective, 
proportionate  and dissuasive. 

Article 56 

This Regulation  shall enter  into force on 1 January 1994. 

This Regulation  shall be binding  in its entirety and directly applicable in 
all Member  States. 

ANNEX I 

Legal entities mentioned  in Article  2  (1) (a) 

ins 

For Belgium 

Association of mutual  insurance, coming under Article 2 of the Law of 11 June 
1874 on insurance and Article  11 of the Law of 9 July  1975 on the control of 
insurance enterprises; cooperative  societies coming under Articles  141 to 164 
of the consolidated  law on commercial  companies as it affects  cooperative 
societies 

For Denmark 

Fortsaettelsessygekasse; Gensidige  selskaber 

For Germany 

Versicherungsverein  auf Gegenseitigkeit  ( W a G ),  coming under the law of 6 
June 1931 on the control of  insurance enterprises, in the version of  1 July 
1990; 

(AMENDMENT by the rapporteur and the ESC) 

Statutory  health  insurance  funds within the scope of the Social Code  (SGBV); 
Accident  insurance associations within  the meaning of Articles  545 and 762 of 
the Insurance Regulations  (RVO) 

For France 

Mutuals coming under the Code de  la mutualité  (the Law of 25 July  1985); 
mutual  insurance societies coming  under the Code des Assurances; Caisse de 
Mutualité Agricole, regulated  by the Code Rural 

For  Ireland 

Voluntary Health  Insurance Board  coming  under the Voluntary  Health  Insurance 
Act of 5 February  1957; companies  limited  by guarantee; societies  registered 
under the Industrial and Provident  Societies Acts; societies registered  under 
the Friendly  Societies Acts 

For Italy 

Mutuals coming under the Law of  15 April  1886; cooperative  societies, coming 
under Section VI of the Civil Code  relating  to cooperative  and mutual 
societies as well as the cooperatives and mutuals covered  by  legislation or 
regulations  for certain  categories 

For Luxembourg 

Societies of mutual  assistance and mutuals  coming  under the Law of  7 July 
1961 and Grand Duchy Regulation of  31 July  1961; associations of mutual 

insurance coming under Article 2 of the Law of  16 May  1891 

116 

For the Netherlands 

Entities coming under Section  3  'association'  (vereniging) of the second Book 
of the Burgerlijk Wetboek on cooperative  union 

For the United Kingdom 

Companies  limited by guarantee having as their principal object the 
maintenance of a provident  fund; mutual companies; societies registered under 
the Industrial and Provident Societies Acts; societies registered under the 
Building Societies Acts; societies registered  under the Friendly  Societies 
Act 

For Greece 

Entities coming under the law for mutuals; Allelasphalistikos  Sunetairismos 

For Spain 

Entidades de Prevision Social, coming under the Law of 2 August  1984 
establishing the regulation of private  insurance; Mutuas des Ace. de Trabajo, 
coming under the Law of 2 August  1984 establishing  the regulation of private 
insurance; Sociedad mutua, coming  under the Law of 2 August  1984 establishing 
the regulation of private insurance; Sociedad  cooperativa, coming  under the 
Law of 2 April  1987 and regional  laws 

For Portugal 

Mutualidades, Associaçoes Mutualistas, coming under the decree  law No 72/90 
of 3 March  1990; Misericordias, coming under Articles  167 to 194 of the Civil 
Code relating to associations and  foundations; Mutua de  seguros 

ANNEX  II 

11S 

Legal entities referred  to in Article 2  (1) (b) which manage obligatory 
social security  schemes as well as provident  and mutual  assistance 
organizations, the services of which vary according to the resources 
available and  in which the contribution of members  is determined  by contract 

For Belgium 

Mutuals coming under the Law of 6 August  1990 relating  to mutuals and to 
national unions of mutuals 

For Denmark 

Fortsaettelsessygekasse 

For Germany 

(AMENDMENT by the rapporteur and the ESC) 

Statutory  health  insurance  funds within the scope of the Social Code  (SGBV); 
Accident  insurance associations within the meaning of Articles 545, 632, 719a 
and  762 of the Insurance Regulations  (RVO) 

For France 

(AMENDMENT  No 114) 

Mutuals coming under the Code de la Mutualité  (Law of 25 July  1985); 
Mutual  insurance societies within the scope of the Insurance Code; 
Agricultural mutual  funds governed by the Rural Code 

For  Ireland 

Voluntary Health  Insurance Board coming  under the Voluntary Health  Insurance 
Act of  5 February  1957 

For  Italy 

Mutuals coming  under  the Law of  15 April  1886 

For  Luxembourg 

Mutual assistance societies and mutuals coming  under  the Law of  7 July  1961 
and Grand Duchy Regulation of  31 July  1961 

For the Netherlands 

Ziekenfonds  (Vereniging  van Nederlandse  Zorgverzekeraars  - VNZ - and 
Zilverenkruis) coming under the Law of  1 January  1966 or the Algemene Wet 

Bijzondere  Ziektekosten 

-103 

For Greece 

Entities coming under the law for mutuals 

For Spain 

Entidades de Prevision Social, coming under the Law of 2 August  1984 
establishing the regulation of private  insurance 

For Portugal 

Mutualidades, Associaçoes Mutualistas coming under the Decree-Law No 72/90 of 
3 March  1990/90 

-  *M  -

Amended proposal  for a Council Directive supplementing  the Statute for a 
European mutual society with regard to the involvement of employees 

SYN 391 

THE  COUNCIL  OF  THE  EUROPEAN  COMMUNITIES, 

Having regard to the Treaty establishing the European Economic Community, and 
in particular Article 54 thereof, 

Having regard to the proposal  from the Commission, 

In cooperation with the European Parliament, 

Having regard to the opinion of the Economic and Social Committee, 

Whereas  in order to attain the objectives set out  in Article 8a of the 
Treaty, Regulation  (EEC) No  . . . /.  .  A1)  establishes a statute  for a 
European mutual  society (ME); 

(AMENDMENT  No 116) 

Whereas there are in the Member States  laws, regulations and  administrative 
provisions concerning the provision of  information  to and the consultation of 
the employees of undertakings, whatever their  legal  form; whereas  in some 
Member States, there are provisions concerning the participation of employees 
in mutuals, whatever their type of activity; 

Whereas  it is desirable to coordinate  information and  consultation 
arrangements at Community  level in order to develop dialogue between the 
management boards and administrative boards of MEs and employees; 

Whereas the realization of the internal market is giving rise to a process of 
concentration  and conversion of mutuals; whereas  in order to ensure a 
harmonious development of economic activities, MEs carrying on cross-border 
activities must adopt, if appropriate, a participation model, or, failing 
this, inform and consult employees on decisions which concern them; 

Whereas this Directive determines the minimum  areas where there must be 
information and consultation, without prejudice to the application  of the 
following Directives: 

- Council Directive 75/129/EEC of 17 February  1975 on the approximation of 
the  laws of the Member States relating to collective  redundancies^)t  as 
amended  by Directive  .../.../EEC(^), 

- Council Directive 77/187/EEC of  14 February  1977 on the approximation of 
the  laws of the Member States relating to the safeguarding  of employees' 
rights  in the event of transfer of undertakings, businesses or parts of 
businesses(^), and 

- Council Directive  .../../EEC of  ... on the establishment  of a European 
works council  in Community-scale undertakings or groups of undertakings  for 
the purposes of informing and consulting  employees(^); 

Whereas appropriate provisions must be adopted to ensure that the employees 
of MEs are properly  informed and consulted where decisions  likely to affect 
their  interests are taken in a Member State other than that  in which they are 
employed; 

(1) OJ No L 
(2) OJ No L 48, 22.2.1975, p. 29. 
(3) COM(91) 292  final, 15.7.1991. 
(4) OJ No L 61, 5.3.1977, p. 26. 
(5) COM(90) 581 final. 

Whereas the laws, regulations and  administrative provisions of the Member 
States governing  the participation of employees  in national mutuals may be 
made applicable to MEs; 

Whereas an ME may not be registered  until a participation model or, in the 
absence thereof, an employee  information  and consultation  system and in 
particular  a separate committee has been chosen; 

Whereas, however, the natural persons who  founded the ME or, where no 
agreement  is reached prior to registration  of the ME, the founder entities 
should propose to the general meeting called to approve the formation of the 
ME certain requirements with respect  to informing  and consulting employees; 

Whereas the information and consultation  committee or any other  alternative 
body must be informed  and consulted  about decisions on the part of the ME 
capable of affecting the employees' interests; 

Whereas  in order to ensure the proper  functioning  of the internal market and 
avoid  any  inequality  in the terms of competition, the employees of the ME 
should be guaranteed  equivalent  levels of  information  and consultation; 

Whereas  in order to allow  for more  flexibility  with respect to small MEs, 
Member States need not provide  for employee representation  in MEs employing 
fewer than 50 workers; 

Whereas the provisions of this Directive  form an indissociable supplement to 
those of Regulation  (EEC) No  . . . / ..  . /EEC  {on the statute for a 
European mutual  society); whereas  it is therefore necessary  to ensure that 
the two sets of provisions are applied  concomitantly, 

HAS  ADOPTED  THIS  DIRECTIVE: 

Article 1 

This Directive coordinates the  laws,  regulations and  administrative 
provisions of the Member States concerning  the  involvement  of employees in 
the ME. 

This Directive  is an essential  supplement  to Regulation  (EEC) No 
.  . . / . . . (on the statute for a European mutual  society). 

No ME may be registered  until a participation model or, in the absence 
thereof, an information  and consultation  system  has been chosen  in accordance 
with the provisions of this Directive. 

TITLE  I 

Participation 

Article 2 

The  laws, regulations and administrative  provisions of a Member State 
governing  the participation of employees  in the supervisory  or  administrative 

^3 

boards of national mutual  societies may  be made applicable to an ME whose 
registered office  is in its territory. 

Where such provisions are not applied  the Member  State shall take the 
necessary measures to ensure at  least that the employees of the ME are 
informed  and consulted  in accordance with Articles  3, 4 and 5. 

TITLE  II 

Information and consultation  arrangements 

Article 3 

1. The management boards or administrative  boards of the founder entities and 
the representatives of the employees of those entities provided  for by the 
laws and practices of the Member States shall agree arrangements  for 
informing  and consulting the employees of the ME. The agreement must be 
concluded  in writing before the ME  is registered. 

2. Where the ME  is formed  solely by natural  persons, those persons shall lay 
down  information and consultation  procedures on the basis of the  requirements 
with respect to informing  and consulting  employees set out  in Article 4(1); 
those procedures must be submitted  to the general meeting  called  to approve 
the formation of the ME. 

3. Where no such agreement  can be reached  the representatives of the 
employees of the founder entities may make a written  statement  setting out 
why, in their opinion, the formation of the ME  is contrary  to the employees' 
interests and what measures should  be taken with respect to the employees. 

4. The management  boards or administrative  boards of the  founder  entities 
shall draw up for submission to the general meeting  called  to approve the 
formation of the ME a report to which  is attached  either 

- the text of the agreement  referred  to in paragraph  1, or 

- the statement by the employees' representatives  referred  to in paragraph 2. 

5. The general meeting  called  to approve the formation of the ME shall  ratify 
the information and consultation  arrangements embodied  in the agreement 
referred  to in paragraph  1, or where no agreement  has been reached,  shall 
decide on the arrangements which  are to apply  to the ME  in the  light of the 
report and of the statement  referred  to  in paragraphs  2 and 3. 

6. The arrangements  chosen may  subsequently  be replaced  by other  arrangements 
agreed between the ME's management  board or administrative board and the 
representatives of the employees of  the ME. The agreement must be submitted 
to the general meeting  for approval. 

7. The procedure  laid down  in thiB Article  shall  apply  in the event of 
conversion pursuant  to Article 2  (2) of  the Regulation  (EEC)  . . . / . .. 
(on the statute  for a European mutual  society). 

(AMENDMENT Nos 129 and  156, in part) 

8.  In the event of the registered  office of an ME being transferred  to 
another Member State, the information  and consultation  arrangements  in 
existence before the transfer may be altered  only by agreement between the 
management  board or the administrative board of the ME and the 

representatives of the employees of the ME. 

1^ 

Article 4 

1. The management board or the administrative board of the ME shall  inform 
and consult  in good time the employees of that entity  at  least  in the 
following areas: 

(AMENDMENT No 130) 

(a) any proposals which might significantly  affect the  interests of the 
employees of the ME or which have a potential  impact on the prospects of the 
ME and the conditions of employment  and especially  all matters concerning 
working conditions and all decisions requiring the approval of the management 
board or the administrative board, without  prejudice to the Community 
provisions concerning  information and consultation, and  in particular 
Directives 75/129/EEC, 77/187/EEC and  . . . / . ..  /EEC  (on the 
establishment of a European works  council); 

(b) any question concerning  conditions of employment,  in particular  changes 
affecting the organization of the ME and the  introduction of new working 
methods or new products and/or services; 

(c) all documents submitted to the ME*s general meeting; 

(d) the operations referred  to in Article  38  (1) of the Regulation  (EEC) 
.  . . / . • - (on the statute  for a European mutual  society); 

(AMENDMENT No 131) 

(e) the development and organization of vocational training  undertaken  in the 
ME and any matter affecting the health and  safety of employees, with equal 
and  joint participation  in the development  of health and  safety  programmes 
and policies in the ME. 

(AMENDMENT Nos 132 and 161, in part) 

2. The employees of the ME shall be  informed  and consulted: 

- within a separate committee representing  the employees of the ME, or 

- within any other  structure agreed  between  the management  boards or 
administrative boards of the founder entities and the representatives of the 
employees of those entities. 

These procedures must be completed  in good  time before the  final decision is 
reached, so that any objections raised  by the employees' representatives may 
be taken  into account. 

In addition, by way of preparation  for the consultation  procedure, experts 
may be called  in as advisers and the management  board or administrative board 
shall make available all appropriate  facilities thereto. 

A Member State may restrict this range of participation  and  information 
arrangements  in the case of MEs having  their  registered  head office  in its 
territory. 

3.  In an ME with  fewer than 50 employees  the two parties to the  negotiations 
may decide that  simplified  information  and consultation  arrangements  should 
be  laid down, subject  to compliance with  paragraph  1. 

Article 5 

1ZC 

1. The representatives of the employees of the ME shall be elected, and shall 
be provided with such facilities as are necessary  to enable them to perform 
their duties properly, in accordance with the laws and practices of the 
Member States and  in compliance with the following principles: 

(a) employees' representatives must be elected  in each Member State in which 
the ME has establishments or subsidiaries; 

(b) the number of representatives  so elected must as far as possible be in 
proportion to the number of employees they represent; 

(c) all employees must be able to participate  in the vote irrespective of 
their  length of service or the number of hours they work per week; 

(d) the election must be by secret ballot. 

2. The employees' representatives elected  in accordance with paragraph  1 may 
perform their  functions within the ME  irrespective of the rules governing 
qualification as an employees' representative  in the law of the Member State 
in which the ME has its registered office. 

(AMENDMENT No 135) 

The elected employees' representatives may  carry out their duties during 
working hours. No disciplinary  measures may  be taken against them  in relation 
to actions connected with performance of their duties. They may not be 
routinely dismissed during their period  of office. 

(AMENDMENT No 134) 

Article 5a 

Member States shall  impose appropriate  sanctions  shaould  an ME fail to comply 
with the provisions of this Directive. In particular, Member States shall 
give the employees' representatives  the right to request the courts or other 
competent  national authorities to take  interim  protective measures to 
safeguard  their interests. 

TITLE  III 

Final  provisions 

Article 6 

1. Member States shall bring  into  force the  laws, regulations and 
administrative  provisions necessary  to comply  with this Directive before 1 
January  1994. They  shall  immediately  inform  the Commission  thereof. 

When Member States adopt these provisions, these shall  contain a reference to 
this Directive or shall be accompanied  by  such  reference at the time of their 
official  publication. The procedure  for such  reference  shall be adopted by 
Member States. 

2. Member States shall communicate to the Commission the main provisions of 
national  law which they adopt  in the  field  covered by this Directive. 

1-^-q. 

Article 7 

This Directive  is addressed  to the Member States. 

Done at Brussels, 

For the Council 

ISSN 0254-1475 

COM(93) 252 final 

DOCUMENTS 

EN 

10  oi 

Catalogue number : CB-CO-93-281-EN-C 

ISBN 92-77-56324-9 

Office for Official Publications of the European Communities 
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