CELEX: 51984PC0727
Language: en
Date: 1985-01-08
Title: PROPOSAL FOR A TENTH DIRECTIVE OF THE COUNCIL BASED ON ARTICLE 54 ( 3 ) ( G ) OF THE TREATY CONCERNING CROSS-BORDER MERGERS OF PUBLIC LIMITED COMPANIES

25.1.85                              Official Journal of the European Communities                          No C 23/11
             Proposal for a Tenth Council Directive based on Article 54 (3) (g) of the Treaty
                             concerning cross-border mergers of public limited companies
                                                   COM(84)     727final
                           (Submitted by the Commission to the Council on 14 January 1985)
                                                      (85/C 23/08)
THE COUNCIL OF THE EUROPEAN                                     Whereas the scope of this Directive is essentially the
COMMUNITIES,                                                    same as that of Directive 78/855/EEC; whereas,
                                                                however, a Member State should also be empowered
                                                                not to apply this Directive to companies which, under
Having regard to the Treaty establishing the
                                                                its law, are governed by provisions concerning
European Economic Community, and in particular
                                                                employee participation in the composition of the
Article 54 (3) (g) thereof,
                                                                organs of those companies; whereas this exception
                                                                appears necessary at any rate until the Council has
Having regard to the proposal from the Commission,              decided on the Commission's amended proposal for a
                                                                Fifth Directive based on Article 54 (3) (g) of the
                                                                Treaty concerning the structure of public limited
Having regard to the opinion of the European Par-               companies and the powers and obligations of their
liament,                                                        organs (2); whereas in other respects the protection of
                                                                employees in the event of either cross-border or
Having regard to the opinion of the Economic and                national mergers is guaranteed by Council Directive
Social Committee,                                               77/187/EEC( 3 );
Whereas, although mergers between public limited
liability companies have been coordinated by Council            Whereas, for the purpose of defining cross-border
Directive 78/855/EEC ('), such coordination extends             mergers, reference may be made to the definition of
only to mergers involving companies which are                   national mergers in Directive 78/855/EEC, with the
governed by the law of the same Member State;                   sole exception that two or more of the companies
whereas, in the interests of the common market,                 involved must be governed by the laws of different
provision should be made particularly of mergers                Member States;
involving companies which are governed by the laws
of different Member States;
Whereas Article 220 of the Treaty which provides for            Whereas, although Directive 78/855/EEC permits
Member States, where necessary, to enter into                   Member States to choose whether or not to apply
negotiations with each other with a view to ensuring            certain provisions of that Directive in the case of
that cross-frontier mergers are possible, does not              national mergers, they may exercise those options in
prevent the matter from being harmonized by                     the case of cross-border mergers only for those
directive;                                                      companies involved in the operation which are
                                                                governed by their law;
Whereas that approach offers the advantage that in
the numerous cases where the arrangements
governing national and cross-border               mergers       Whereas although Directive 78/855/EEC permits
coincide, reference can be made in the present                  certain exceptions for operations treated as mergers,
Directive to the corresponding provisions of Directive          Member States may make use of those exceptions in
78/855/EEC, thereby ensuring at the same time a                 the case of cross-border mergers only if the other
more uniform implementation and interpretation of               Member States whose law governs the other
both sets of rules than would be possible with two              companies involved have also done so;
completely separate legal instruments;
Whereas this Directive is therefore limited to
                                                                Whereas although Directive 78/855/EEC provides in
additional requirements or to those aspects of cross-
                                                                the case of national mergers that it is sufficient for
border mergers which differ from national mergers;
                                                                the draft terms of a merger to be drawn up in writing,
                                                                O OJ No C 240, 9. 9. 1983, p. 2.
0) OJ No L 295, 20. 10. 1978, p. 36.                            C) OJ No L 61, 5. 3. 1977, p. 26.
 ---pagebreak--- N o C 23/12                           Official Journal of the European Communities                                25.1.85
the draft terms of a cross-border merger need to be              (b) Belgium:
drawn up and certified in due legal form if the law of                societe anonyme / naamloze vennootschap;
a Member State governing one of the companies
involved so provides;                                            (c)   Denmark:
                                                                      aktieselskaber;
Whereas, following their filing in the register, the
draft terms of a national merger may be published in             (d) France:
the national gazette in accordance with Council                       societe anonyme;
Directive 68/151/EEC (x) simply by means of
reference to their filing in the register; whereas, in the       (e) Greece:
case of cross-border mergers, additional details                      av(bvt)HT| ETcapta;
appear necessary in order to provide third parties,
and particularly creditors of companies being                    (f) Ireland:
acquired, with better information on their rights;
                                                                      public companies     limited   by   shares   or   by
                                                                      guarantee;
Whereas stricter requirements should not be imposed
in respect of a general meeting's decision concerning            (g) Italy:
a cross-border merger than in respect of a general                    societa per azioni;
meeting's decision concerning a national merger;
                                                                  (h)  Luxembourg:
Whereas the creditors of companies involved in a                      socidte anonyme;
cross-border merger should benefit from the same
system of protection as creditors in the case of a                (i) The Netherlands:
national merger;                                                      naamloze vennootschap;
                                                                  (j)  United Kingdom:
Whereas in the case of cross-border mergers the
                                                                      public companies      limited  by    shares  or   by
judicial or administrative preventive supervision or,
where appropriate, the drawing up and certification                   guarantee.
 of documents in due legal form, must be
 synchronized for all the companies involved;                     2.    Where a Member State applies Article 1 (2) or
                                                                  (3) of Directive 78/855/EEC in respect of a company
                                                                  governed by its law which is involved tin a cross-
Whereas a cross-border merger may not take effect                 border merger, this Directive shall not apply.
 until the necessary supervision or formalities have
 been completed for all the companies involved;
                                                                  3. - Pending subsequent coordination, a Member
                                                                  State need not apply the provisions of this Directive
 Whereas the publication of a cross-border merger                 to a cross-border merger where an undertaking,
 must take place for the acquired company before it               whether or not it was involved, would as a result no
 takes place for the acquiring company;                           longer meet the conditions required for employee
                                                                  representation in that undertaking's organs.
 Whereas the grounds of nullity of cross-border
 mergers should be limited as far as possible,                    4.    Protection of the rights of the employees of
                                                                  each of the companies involved in a cross-border
 HAS ADOPTED THIS DIRECTIVE:                                      merger shall be regulated in accordance with
                                                                  Directive 77/187/EEC.
                          Article 1
                                                                                          Article 2
  1.   The coordination measures laid down by this
 Directive shall apply to the laws, regulations and                1.   Except where this Directive provides otherwise,
 administrative provisions of the Member States                   the Member States shall provide for cross-border
 relating to the following types of company:                      mergers by the acquisition of one or more companies
                                                                  by another and for cross-border mergers by the
 (a) Germany:                                                     creation of a new company in accordance with
                                                                  Directive 78/855/EEC in respect of companies
      Aktiengesellschaft;
                                                                  governed by their law.
                                                                   2.   Articles 17 and 22 (1)         (b)   of   Directive
 0) OJ No L 65, 14. 3. 1968, p. 8.                                 78/855/EEC shall not apply.
 ---pagebreak--- 25.1. 85                            Official Journal of the European Communities                            No C 23/13
3.    A Member State may apply Articles 3 (2), 4 (2),                                   Article 6
8, 11 (2) second subparagraph, 22 (1) and (2), 23 (4)
and 25 to 29 of Directive 78/855/EEC only in                   1.     Article 6 of Directive 78/855/EEC and Article 3
respect of those companies involved in a cross-border          of Directive 68/151/EEC shall apply to the pub-
merger which are governed by its law.                          lication of the draft terms of a cross-border merger
                                                               for each of the merging companies.
4.    A Member State may apply Articles 30 and 31              2.     However, when the draft terms referred to in
of Directive 78/855/EEC to those companies                     paragraph 2 are disclosed as provided for in Article 3
involved in a cross-border merger which are governed           (4) of Directive 68/151/EEC for each of the merging
by its law only if the Member States by whose law the          companies the following information shall be
other companies involved in the operation are                  specified:
governed have also done so.
                                                               (a) the type, name and registered office of each of
                                                                    the merging companies;
                        Article 3
For the purposes of this Directive, 'cross-border              (b) the register in which a file as referred to in Article
merger by acquisition' means the operation referred                 3 (2) of Directive 68/151/EEC has been opened
to in Article 3 (1) of Directive 78/855/EEC, with the               for each of the merging companies and the
exception that two or more of the companies involved                number of the entry in that register;
must be governed by the laws of different Member
States.                                                        (c) the conditions which, in accordance with Article
                                                                    11, determine the date on which the cross-border
                                                                    merger takes effect.
                        Article 4
For the purposes of this Directive, 'cross-border              3.    The disclosure shall also specify for the acquired
merger by the formation of a new company' means                company or companies the details of the exercise of
the operation referred to in Article 4 (1) of Directive        the rights of the creditors of those companies in
78/855/EEC, with the exception that two or more of             accordance with Articles 13, 14 and 15 of Directive
the companies involved must be governed by the laws            78/855/EEC and Article 9 of this Directive.
of different Member States.
                                                                                        Article 7
                        Article 5                              Article 7 of Directive 78/855/EEC relating to rules
                                                               for approval by the general meeting shall apply to
1.    Article 5 of Directive 78/855/EEC shall apply            each of the merging companies. However the
to the drawing up of the draft terms of a cross-border         Member States may not require a larger majority than
merger. No further details than those listed in                they require for a merger in which all the companies
paragraph 2 of the abovementioned Article may be               involved are governed by their law.
required.
                                                                                        Article 8
2.    The draft terms of a cross-border merger shall
be drawn up and certified in due legal form if this is         1.    Article 10 of Directive 78/855/EEC relating to
prescribed by the law of a Member State by which               the drawing up of the report of the expert or experts
one or more of the companies involved in the cross-            shall apply.
border merger is governed.
                                                               2.     The experts shall be appointed or approved by a
                                                               judicial or administrative authority of the Member
3.    The law of the Member State requiring that the           State whose law governs the company for whose
draft terms be drawn up and certified in due legal             shareholders the report is drawn up.
form shall determine the person or authority
competent so to do. Where the laws of several
Member States by which companies involved in the               3.     Where all the laws of the Member States by
cross-border merger are governed require that the              which the companies involved in a cross-border
draft terms be drawn up and certified in due legal             merger are governed apply the second sentence of
form, this may be done by any person or authority              Article 10 (1) of Directive 78/855/EEC, the
competent under the law of one of those Member                 appointment of one or more experts for all the
States.                                                        merging companies may be made at the joint request
 ---pagebreak--- No C 23/14                            Official Journal of the European Communities                                 25.1.85
of those companies by a judicial or administrative               companies being acquired provides for judicial or
authority of any of those Member States. In such                 administrative preventive supervision of the legality of
cases, the content of the expert's report shall be               the cross-border merger, that supervision shall be
determined by the law governing that judicial or                 carried out first in respect of the acquiring company.
administrative authority in accordance with Article 10           It may not be carried out in respect of a company
(2) of Directive 78/855/EEC.                                     being acquired until proof is furnished that it has
                                                                 already been carried out in respect of the acquiring
                                                                 company.
                         Article 9
 1.   Articles 13 and 14 of Directive 78/855/EEC
relating to the system of protection of the interests of         4.    Where the law governing one or more of the
creditors shall apply to cross-border mergers.                   companies involved provides for judicial or
                                                                 administrative preventive supervision while the law
                                                                 governing one or more of the other companies
2.    The protective system shall not be different from          involved does not, that supervision must be carried
that which applies to the creditors of merging                   out simply on the basis of the documents drawn up
companies which are all governed by the law of the               and certified in due legal form referred to in Article
Member States concerned.                                          16 of Directive 78/855/EEC.
3.    Article 15 of Directive 78/855/EEC shall apply
to cross-border mergers subject to the proviso that:                                      Article 11
                                                                 The law of the Member State governing the acquiring
(a) the law governing the company being acquired                 company shall determine the date on which a cross-
    shall determine whether a meeting of holders of              border merger takes effect. That date must be after
    the securities referred to may approve an                    the supervision has been carried out and, where
    alteration in their rights in that company;                  appropriate, the documents certified in due legal form
                                                                 referred to in Article 10 have been drawn up for all
(b) the law governing the acquiring company shall                the companies involved.
    determine whether the holders of the securities
    referred to are entitled to have them repurchased
    by the acquiring company.
                                                                                          Article 12
                                                                 Article 18 of Directive 78/855/EEC shall apply.
                        Article 10                               However the publication of a cross-border merger
                                                                 must take place for the company or companies being
1.    Where the law of a Member State governing
                                                                 acquired before publication for the acquiring
one or more of the companies involved in a cross-
                                                                 company.
frontier merger provides for judicial or administrative
preventive supervision of the legality of that merger,
that law shall apply to those companies.
                                                                                          Article 13
2.    Where the law of a Member State governing                  Article 19 (3) of Directive 78/855/EEC shall apply
one or more of the companies involved in a cross-                subject to the proviso that the law of the Member
frontier merger does not provide for judicial or                 State governing a company being acquired shall
administrative preventive supervision or where such              determine whether in order to be effective against
supervision does not extend to all the legal acts                third parties, the transfer of certain assets, rights and
required for the merger, Article 16 of Directive                 obligations by that company requires the completion
78/855/EEC shall apply to the company or                         of special formalities.
companies concerned. Where that law provides for a
merger contract to be concluded following the
decisions of the general meetings held concerning the
cross-border merger, that contract shall be concluded
                                                                                          Article 14
by all the companies involved in the operation. Article
5 (3) shall apply.                                               The civil liability of the members of the administrative
                                                                 or management bodies and of the experts of an
                                                                 acquired company shall be determined, in accordance
3.    Where both the law governing the acquiring                 with Articles 20 and 21 of Directive 78/855/EEC, by
company and the law governing the company or                     the law of the Member State governing that company.
 ---pagebreak--- 25.1. 85                               Official Journal of the European Communities                          N o C 23/15
However, in the case referred to in Article 8 (3), the            3.    Article 22 (1) (f) of Directive 78/855/EEC shall
civil liability of the experts shall be determined by the         apply where the laws of a Member State where a
law of the Member State governing the judicial or                 judgment has declared a cross-border merger void
administrative authority which appointed them.                    permit a third party to challenge such a judgment.
                         Article 15                                                       Article 16
1.     Article 22 (1) of Directive 78/855/EEC shall               1.    The Member States shall bring into force the
apply subject to the proviso in paragraph 1 (b) of the            laws, regulations and administrative provisions
said Article that a cross-border merger which has                 necessary to comply with this Directive before
taken effect pursuant to Article 11 of this Directive             1 January 1988. They shall forthwith inform the
may be declared void only if there has been no                    Commission thereof.
judicial or administrative preventive supervision of its
legality or if it has not been drawn up and certified in          2.    The Member States need not apply this
due legal form, where such supervision or certi-                  Directive to cross-border mergers or to operations
fication is laid down by the law of the Member State              treated as cross-border mergers for the preparation or
governing the relevant company. However where the                 execution of which a prescribed act or formality has
law governing the acquiring company does not                      already been completed when the provisions referred
provide for the nullity of the merger where there has             to in paragraph 1 enter into force.
been no judicial or administrative preventive
supervision of its legality or where it has not been              3.    The Member States shall communicate to the
drawn up and certified in due legal form, it may not              Commission the texts of the main provisions of
be declared void.                                                 national law which they adopt in the fields covered by
                                                                  this Directive.
2.     The law of a Member State may not provide for
grounds of nullity for cross-border mergers which it                                      Article 17
has not provided for mergers involving companies all
of which are governed by that law.                                This Directive is addressed to the Member States.