CELEX: 51988PC0153
Language: en
Date: 1988-03-28
Title: AMENDED PROPOSAL FOR AN ELEVENTH COUNCIL DIRECTIVE ON COMPANY LAW CONCERNING DISCLOSURE REQUIREMENTS IN RESPECT OF BRANCHES OPENED IN A MEMBER STATE BY CERTAIN TYPES OF COMPANIES GOVERNED BY THE LAW OF ANOTHER STATE

No C 105/6                             Official Journal of the European Communities                             21. 4. 88
                                                               II
                                                       (Preparatory Acts)
                                                  COMMISSION
              Amended Proposal for an Eleventh Council Directive on company law concerning disclosure
              requirements in respect of branches opened in a Member State by certain types of companies
                                          governed by the law of another State (')
                                                      COM(88) 153 final
              (Submitted by the Commission to the Council on 5 April 1988 on the basis of Article 149 (3) of the
                                                         EEC Treaty)
                                                        (88/C 105/08)
              (') OJ No C 203, 12. 8. 1986, p. 12.
                       INITIAL PROPOSAL                                             AMENDED PROPOSAL
THE COUNCIL OF THE EUROPEAN COMMUNITIES,                           Unchanged
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 facilitate the exercise of the freedom
of establishment in respect of companies covered by
Article 58 of the Treaty, Article 54 (3) (g) and the
general programme on the suppression of restrictions on
the freedom of establishment require coordination of the
safeguards required of companies and firms in the
Member States for the protection of the interests of
members and others;
Whereas hitherto this coordination has been effected in
respect of disclosure by the adoption of the First Council
Directive 68/151/EEC ('), covering limited liability
companies and continued in the field of accounting by
the Fourth Council Directive 78/660/EEC (2) on annual
accounts of certain types of companies, the Seventh
Council Directive 83/349/EEC (3) on consolidated
accounts and by the Eighth Council Directive
84/253/EEC (4) on the approval of persons performing
the statutory audits of accounting documents;
0) OJ  No  L 65, 14. 3. 1968, p. 9.
O  OJ  No  L 222, 14. 8. 1978, p. 11.
O  OJ  No  L 193, 18. 7. 1983, p. 1.
O  OJ  No  L 126, 12. 5. 1984, p. 20.
 ---pagebreak---  21. 4. 88                             Official Journal of the European Communities                           No C 105/7
                      INITIAL PROPOSAL                                                AMENDED PROPOSAL
Whereas these Directives apply to companies as such but
do not cover their branches; whereas, the opening of a
branch, as well as the creation of a subsidiary company,
is one of the possibilities currently open to companies in
exercising their rights of establishment in another
Member State;
Whereas in respect of branches the lack, of coordination,
in particular concerning disclosure, gives rise to disparity
in respect of protection of shareholders and third parties
between companies which operate in other Member
States by opening branches and those which operate by
creating subsidiary companies and it is appropriate to
eliminate such disparities in order to ensure an equiv-
alent level of protection for those concerned;
Whereas in this field the divergence among the laws of
the Member States interferes with the exercise of the
right of establishment and it is therefore necessary to
eliminate such divergence to guarantee the exercise of
the said right;
Whereas to ensure the protection of persons who deal             Whereas to ensure the protection of persons who deal
with companies by way of a branch, measures in respect           with companies by way of a branch, measures in respect
of disclosure are required in the Member State in which          of disclosure are required in the Member State in which
the branch is situated, and to effect such disclosure it is      the branch is situated; whereas the economic and social
necessary to make use of the procedure already                   influence of a branch may be comparable to that of a
instituted for limited liability companies within the            subsidiary company, so that to that extent the public
Community;                                                       interest in disclosure is comparable; whereas to effect
                                                                 such disclosure it is necessary to make use of the
                                                                 procedure already instituted for limited liability
                                                                 companies within the Community;
Whereas the said disclosure with an exception in respect         Whereas the said disclosure with an exception in respect
of those having powers of representation may be                  of those having powers of representation and the
confined to information concerning the branch itself             winding-up of the company may be confined to infor-
together with a reference to the register of the company         mation concerning the branch itself together with a
of which the branch is part, given that, pursuant to             reference to the register of the company of which the
Community rules, all information covering the company            branch is part, given that, pursuant to Community rules,
as such is available on that register;                            all information covering the company as such is available
                                                                  on that register;
Whereas national provisions in respect of disclosure of          Unchanged
accounting documents relating to the branch can no
longer be justified following the coordination of national
law in respect of the drawing up, statutory audit and
disclosure of the accounting documents of the company;
whereas in consequence it is sufficient to disclose, on the
register of the branch, the annual accounts of the
company and, in default of those, the consolidated
accounts in which the company is included;
 ---pagebreak--- No C 105/8                              Official Journal of the European Communities                                  21. 4. 88
                       INITIAL PROPOSAL                                                 AMENDED PROPOSAL
Whereas to avoid any discrimination arising out of the             Unchanged
country of origin of the company, the Directive should
also cover branches created by companies governed by
the law of third countries and based on legal forms
comparable with limited liability companies, whereas for
these branches it is necessary to apply certain provisions
different from those applying to branches of companies
governed by the law of other Member States given that
the Directives set out above do not apply to companies
of third countries,
HAS ADOPTED THIS DIRECTIVE:                                       Unchanged
    Branches of companies from other Member States                 Unchanged
                           Article 1                                                        Article 1
Documents and particulars relating to a branch set up in           Unchanged
a Member State by a company which is subject to the
law of another Member State and to which Directive
68/151/EEC applies shall be disclosed according to the
law of the Member State of the branch in compliance
with Article 3 of the said Directive.
                           Article 2                                                        Article 2
1.    The compulsory disclosure provided for in Article 1          1.    Unchanged
shall cover the following documents and particulars:
(a) the address of the branch;
                                                                   (aa) the object of the activities of the branch;
(b) the register in which the company file mentioned in            Unchanged
     Article 3 of Directive 68/151/EEC is kept, together
     with the registration number in that register;
                                                                   (ba) the existence of other branches in the same Member
                                                                        State, together with the particulars referred to in (a)
                                                                        and (b);
 (c) the name of the branch if that is different from the
     name of the company;
 (d) 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 and those who as permanent represen-
     tatives of the company for the activities of the
     branch, are authorized to represent the company in
     dealings with third parties and in legal proceedings.
     It must be stated whether the persons authorized to
     represent the company may do so alone or must act
     jointly;
 ---pagebreak--- 21. 4. 88                               Official Journal of the European Communities                           No C 105/9
                        INITIAL PROPOSAL                                                   AMENDED PROPOSAL
                                                                   (da) the winding-up of the company and the
                                                                        appointment of liquidators, particulars concerning
                                                                        them and their powers in accordance with Article 2
                                                                        (1) (j) of Directive 68/151/EEC;
(e) the accounting documents covered by Article 3;                 Unchanged
(f) the closure of the branch.                                     (f) the closure of the branch and transfers      of its
                                                                       location.
2.     The Member State of the place of the branch may             Unchanged
require the deposit in the register of the branch of the
certified signature of the persons referred to in
paragraph 1 (d).
                          Article 3                                                          Article 3
1.     The    compulsory      disclosure    of    accounting       1.    Unchanged
documents provided for by Article 2 (1) (e) shall be
limited to the annual accounts and annual report of the
company. These documents must have been drawn up
and audited in accordance with the law of the Member
State by which the company is governed in compliance
with Directives 78/660/EEC and 84/253/EEC.
2.     Paragraph 1 shall not apply where, pursuant to              2.    Unchanged
Article 57 of Directive 78/660/EEC, the provisions
thereof concerning the content, auditing and publication
of the annual accounts do not apply to a company which
is a subsidiary company within the meaning of Directive
83/349/EEC. In this event the compulsory disclosure
provided for in Article 1 shall cover the consolidated
accounts and the consolidated annual report of the
parent undertaking of the company. Those documents
must have been drawn up and audited in accordance
with the law of the Member State by which the parent
undertaking is governed in compliance with Council
Directives 83/349/EEC and 84/253/EEC.
 3.    The Member State in which the branch was created
may stipulate that the documents and particulars referred
to in paragraphs 1 and 2 must be published in its official
language and their translation must be certified.
                          Article 4                                                          Article 4
 Member States shall prescribe that letters and order              Unchanged
 forms used by the branch shall state, in addition to the
 information prescribed by Article 4 of Directive
 68/151/EEC, the register in which the file in respect of
 the branch is kept together with the number of the
 branch in that register.
 ---pagebreak--- No C 105/10                             Official Journal of the European Communities                                21. 4. 88
                       INITIAL PROPOSAL                                                 AMENDED PROPOSAL
                               II                                                                II
        Branches of companies from third countries                 Unchanged
                           Article 5                                                        Article 5
Documents and particulars concerning a branch set up in            Unchanged
a Member State by a company which is not governed by
the law of a Member State but which is of a legal form
comparable with the types of company to which
Directive 68/151/EEC applies shall be published
according to the law of the Member State of the branch
in accordance with Article 3 of the said Directive.
                           Article 6                                                        Article 6
1.     The compulsory disclosure provided for in Article 5        Unchanged
shall cover at- least the following documents and
particulars:
(a) the address of the branch;
                                                                   (aa) the object of the activities of the branch;
(b) the law of the State by which the company is
     governed;
(c) where the said law so provides, the register in which
     the company is recorded and the registration number
     of the company in that register;
                                                                   (ca) the existence of other branches in the same Member
                                                                        State, together with the particulars referred to in
                                                                        (a), (aa) and (c);
(d) the instruments of constitution, and memorandum               Unchanged
     and articles of association if they are contained in a
     separate instrument with all amendments to these
     documents;'
(e) the legal form of the company, its seat, its name and
     its object and the amount of subscribed capital if
     these matters are not shown in the documents
     covered by subparagraph (d);
(f) the name of the branch if that is different from the
     name of the company;
(g) 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 and those who as permanent represen-
     tatives of the company for the activities of the branch
      are authorized to represent the company in dealings
     with third parties and in legal proceedings. It must
     be stated whether the persons authorized to
      represent the company may do so alone or must act
     jointly;
                                                                   (ga) the winding-up of the company and the
                                                                         appointment of liquidators, particulars concerning
                                                                         them and their powers;
 (h) the accounting documents referred to in Article 7;
 ---pagebreak--- 21. 4. 88                                Official Journal of the European Communities                          No C 105/11
                       INITIAL PROPOSAL                                                  AMENDED PROPOSAL
(i) the closure of the branch.                                      (i) the closure of the branch and transfers of its
                                                                         location.
2.     The Member State of the place of the branch may              Unchanged
require the deposit in the register of the branch of the
certified signature of the persons referred to in
paragraph 1 (g).
                           Article 7                                                         Article 7
1.    The      compulsory      disclosure    of    accounting       1.     Unchanged
documents provided for by Article 6 (1) (h) shall apply
to at least the annual accounts and annual report of the
company.
2.    Where the company produces                  consolidated      2.     Unchanged
accounts and a consolidated annual report instead of
annual accounts and an annual report the compulsory
disclosure provided for in Article 5 shall cover such
consolidated accounts and the consolidated annual
report.
3.    The documents covered by paragraphs 1 and 2                   3.    The documents covered by paragraphs 1 and 2
must have been drawn up and audited pursuant to the                 must have been drawn up in accordance with Directives
law which governs the company and in accordance with                78/660/EEC and 83/349/EEC respectively, or so as to
the relevant provisions of such legislation or, in default          be equivalent to annual accounts or consolidated
thereof, in accordance with the accounting principles               accounts and an annual report or a consolidated annual
generally accepted in the State in question.                        report drawn up according to the Directive concerned;
                                                                    they must also have been audited pursuant to the law
                                                                   which governs the company.
4.     Article 3 (3) shall apply.                                   4.     Unchanged
                           Article 8                                                         Article 8
Member States shall prescribe that letters and order                Member States shall prescribe that letters and order
forms used by the branch shall state the register in which          forms used by the branch state the register in which the
the file in respect of the branch is kept together with the         file in respect of the branch is kept together with the
number of the branch in that register.                              number of the branch in that register. If the law
                                                                    governing the company requires an entry in a register,
                                                                    that register and the number of the entry shall also be
                                                                    stated.
                                                                                                 Ha
                                                                    Disclosure of particulars in respect of branches in the
                                                                            register in which the company is recorded
                                                                                             Article 8a
                                                                    The particulars of branches, irrespective of their
                                                                    location, opened by companies subject to the law of a
                                                                    Member State and to which Directive 68/151/EEC
                                                                    applies, shall be disclosed by those companies in
                                                                    accordance with Article 3 of the said Directive.
 ---pagebreak---  No C 105/12                             Official Journal of the European Communities                             21. 4. 88
                        INITIAL PROPOSAL                                               AMENDED PROPOSAL
                                III                                                            III
               Transitional and final provisions                   Unchanged
                            Article 9                                                      Article 9
 Member States shall provide for appropriate penalties in          Unchanged
 the case of failure to disclose the matters set out in
Articles 1, 2, 3, 5, 6 and 7 and of omission from
commercial documents of the compulsory particulars
provided for in Articles 4 and 8.
                           Article 10                                                     Article 10
Each Member State shall determine by which persons the             Unchanged
disclosure formalities provided for in this Directive are to
be carried out.
                           Article 11                                                     Article 11
Pending subsequent coordination, Member States need                Unchanged
not apply the provisions of Articles 3 and 7 to the
branches of banks, other financial institutions and
insurance companies.
                           Article 12                                                     Article 12
1.    Member States shall bring into force the laws,               1.    Unchanged
regulations and administrative provisions necessary for
them to comply with this Directive by 1 January 1990.
They shall forthwith inform the Commission thereof.
2.    Member States may stipulate that the provisions              2.    Member States shall stipulate that the provisions
referred to in paragraph 1 shall not apply until 1 January         referred to in paragraph 1 apply from 1 January 1991.
1992.
3.    Member States shall communicate to the                       3.    Member States shall communicate to the
Commission the texts of the main provisions of national            Commission the texts of the provisions of national law
law which they adopt in the field covered by this                  which they adopt in the field covered by this Directive.
Directive.
                           Article 13                                                     Article 13
The Contact Committee set up pursuant to Article 52 of             Unchanged
Directive 78/660/EEC shall also:
(a) facilitate, without prejudice to the provisions of
    Articles 169 and 170 of the Treaty, the harmonized
    application of this Directive, through regular
    meetings dealing, in particular, with practical
    problems arising in connection with its application;
(b) advise the Commission, if necessary, on any
    necessary additions or amendments to this Directive.
                           Article 14                                                     Article 14
This Directive is addressed to the Member States.                  Unchanged