CELEX: 51983PC0185
Language: en
Date: 1983-08-12
Title: AMENDED PROPOSAL FOR A FIFTH DIRECTIVE FOUNDED ON ARTICLE 54 ( 3 ) ( G ) OF THE TREATY CONCERNING THE STRUCTURE OF PUBLIC LIMITED COMPANIES AND THE POWERS AND OBLIGATIONS OF THEIR ORGANS

No C 240/2                                Official Journal of the European Communities                              9. 9. 83
                                                                II
                                                        (Preparatory Acts)
                                                  COMMISSION
                Amended proposal for a Fifth Directive founded on Article 54 (3) (g) of the EEC Treaty
                concerning the structure of public limited companies and the powers and obligations of
                                                         their organs (')
                (Submitted by the Commission to the Council pursuant to Article 149 (2) of the EEC Treaty
                                                       on 19 August 1983)
                O OJ No C 131, 13. 12. 1972, p. 49 or Bulletin of the
                      European Communities (Supplement) 10/72.
                         ORIGINAL PROPOSAL                                             AMENDED PROPOSAL
Proposal for a Fifth Directive to coordinate the safe-              Amended proposal for a Fifth Directive founded on
guards which, for the protection of the interests of                Article 54 (3) (g) of the EEC Treaty concerning the
members and others, are required by Member States                   structure of public limited companies and the powers
of companies within the meaning of the second                                    and obligations of their organs
paragraph of Article 58 of the EEC Treaty, as regards
the structure of societes anonymes and the powers
              and obligations of their organs
THE COUNCIL OF THE EUROPEAN                                         Unchanged.
COMMUNITIES,
Having regard to the Treaty establishing the
European Economic Community, and in particular
Article 54 (3) (g) thereof,
Having regard to the proposal from the Commission,                  Having regard to the proposal from the Commission
                                                                    (*).
Having regard to the opinion of the European                        Having regard to the opinion of the European
Parliament,                                                         Parliament (2),
Having regard to the opinion of the Economic and                    Having regard to the opinion of the Economic and
Social Committee,                                                   Social Comittee (5),
Whereas the coordination provided for in Article                     Whereas the coordination provided for in Article
 54 (3) (g) was begun by Directive 68/151/EEC of                     54 (3) (g) was begun            by Council    Directive
9 March 1968 governing the disclosure, validity of                   68/151/EEC (4) governing the disclosure, validity of
obligations entered into by the representative organs                obligations entered into by the representative organs,
 and the nullity of societes anonymes, societes en                   and the nullity of public limited companies and private
 commandite par actions and societes a responsabilite                limited companies;
 limitee (*);
Whereas the coordination of national laws relating to               Whereas the coordination of national laws relating to
 such limited liability companies was continued by                   such limited liability companies was continued by
 Directive . . . of . ..( 1 ) on the annual accounts;                Council Directive 78/660/EEC (5) on the annual
                                                                     accounts of such companies and by Council Directive
                                                                     83/349/EEC (') on consolidated accounts;
                                                                    (*) OJ No C 131, 13. 12. 1972, p. 49.
                                                                    (2) OJ No C 149, 14. 6. 1982, p. 17.
 (*) Where the French terms are used in the recitals of this        (J) OJ No C 109, 19. 9. 1974, p. 9.
     proposal, they are to be taken to include a reference to
     the corresponding types of company existing in each of         (4) OJ No L 65, 14. 3. 1968, p. 8.
     the 10 Member States.                                          (5) OJ No L 222, 14. 8. 1978, p. 11.
 (') O J N o C 7 , 2 8 . 1. 1972.                                   (*) OJ No L 193, 18. 7. 1983, p. 1.
 ---pagebreak---  9. 9. 83                         Official Journal of the European Communities                            No C 240/3
                     ORIGINAL PROPOSAL                                             AMENDED PROPOSAL
 Whereas, further, the coordination of laws relating to        Whereas further coordination of laws relating to
 societes anonymes must be given priority because              public limited companies has been given priority owing
 these companies, much more than others, carry on              to their relative importance as regards cross-frontier
 cross-frontier activities;                                    economic activities;
Whereas the laws of the Member States relating to              Whereas, accordingly, the laws of the Member States
 the formation and capital of societes anonymes were           relating to the formation and capital of public limited
 coordinated by Directive . . . of . . . (*) and those         companies were coordinated by Council Directive
 relating to mergers of such companies were                    77/91/EEC (') and those relating to mergers and
 coordinated by Directive . . . of . . . (2);                  divisions of such companies were coordinated by
                                                               Council Directives 78/855/EEC (2) and 82/891/
                                                               EEC (J) respectively;
 Whereas so that the protection afforded to the                Whereas, so that the protection afforded to the
 interests of members and others is made equivalent,           interests of members and others is made equivalent,
 the laws of the Member States relating to the                 the laws of the Member States relating to the
 structure of societes anonymes and to the powers and          structure of public limited companies and to the
 obligations of their organs must be coordinated;              powers and obligations of their organs must also be
                                                               coordinated;
Whereas in the fields aforesaid equivalent legal              Whereas, in the fields aforesaid, equivalent legal
 conditions must be created in the Community for              conditions must be created in the Community for
 societes anonymes;                                           competing public limited companies;
Whereas so far as concerns the organization of the            Whereas, so far as concerns the organization of the
 administration of this type of company two different          administration of this type of company, two different
sets of arrangements at present obtain in the                  sets of arrangements at present obtain in the
Community; whereas one of these provides for one              Community; whereas one of these provides for one
administrative organ only while the other provides for         administrative organ only while the other provides for
two, namely a management organ responsible for                two, namely a management organ responsible for
managing the business of the company and an organ              managing the business of the company and an organ
responsible for controlling the management body;              responsible for controlling the management body;
whereas in practice, even under the arrangement               whereas, in practice, even under the arrangement
which provides for only one administrative organ, a           which provides for only one administrative organ, a
de facto distinction is made between active members            de facto distinction is often made between executive
who manage the business of the company and passive             members who manage the business of the company
members who confine themselves to supervision;                 and non-executive members who confine themselves
whereas in order to delimit clearly the responsibilities       to supervision; whereas in both systems a clear
of the persons who are charged respectively with one           delimitation is desirable between the responsibilities of
or other of these duties it is preferable that there be        the persons charged with one or other of these duties;
separate organs whose responsibility it is to carry            whereas the general introduction of such a distinction
them out; whereas, further, the two-tier system will           will facilitate the formation of public limited
facilitate the formation of societes anonymes by               companies by members or groups of members from
members or groups of members from different                    different Member States and, thereby, inter-
Member States and, thereby, interpenetration of                penetration of undertakings within the Community;
undertakings within the Community; whereas to this             whereas the general introduction of the two-tier
end the introduction of the two-tier system on an              system on a compulsory basis is for the time being
optional basis would not be sufficient; whereas that           impracticable though such systems should be made
structure must be made compulsory for all societes             generally available at least as an option for public
anonymes;                                                      limited companies; whereas one-tier systems may
                                                               therefore be maintained provided that they are
                                                               endowed with certain characteristics designed to
                                                               harmonize their functioning with that of two-tier
                                                               structures;
                                                              O OJ No L 26, 31. 1. 1977, p. 1.
(') OJ No C 48, 24. 4. 1970.                                  (*) OJ No L 295, 20. 10. 1978, p. 36.
(2) OJ No C 89, 14. 7. 1970.                                  (J) OJ No L 378, 31. 12. 1982, p. 47.
 ---pagebreak--- No C 240/4                            Official Journal of the European Communities                              9.9.83
                    ORIGINAL PROPOSAL                                              AMENDED PROPOSAL
Whereas the laws of certain Member States provide             Whereas the laws of certain Member States provide
for worker participation within the supervisory body          for employee participation within the supervisory or
but no such provision exists in other Member States;          administrative organ but no such provision exists in
whereas differences in the laws relating to this field        other Member States; whereas provision should be
must be eliminated not least because they constitute a        made for such participation in all Member States, but
barrier to the application of the Community rules             in some Member States employee participation
which are necessary to facilitate transnational               through a body representing company employees or
operations involving reconstruction and inter-                through collectively agreed systems is a necessary first
penetration of undertakings, in particular in so far as       step; whereas differences in the laws relating to this
concerns the giving of effect to Article 220 of the           field must be eliminated not least because they
Treaty which provides inter alia for international            constitute a barrier to the application of the
merger and transfer of the seat; whereas in order to          Community rules which are necessary to facilitate
make provision for worker participation in appointing         transnational operations involving reconstruction and
and dismissing members of the supervisory organ the           interpenetration of undertakings, in particular in so
Directive does not make rules uniform for all the             far as concerns the giving of effect to Article 220 of
Member States but leaves them to choose between a             the Treaty which provides inter alia for international
number of equivalent arrangements;                            mergers and transfers of seat; whereas, in order to
                                                              make provision for employee participation, the
                                                              Directive does not make rules uniform for all the
                                                              Member States but leaves them to choose between a
                                                              number of equivalent arrangements; whereas certain
                                                              common principles are nevertheless necessary in
                                                              particular as to the appointment of employee rep-
                                                              resentatives;
                                                              Whereas the operation of this Directive's provisions
                                                               concerning the organization of the company's
                                                               administration and employee participation should be
                                                              reviewed within five years after the date from which
                                                              the provisions of the Directive are to be applied;
                                                              whereas this review should examine the question
                                                              whether, and if so to what extent, further harmo-
                                                              nization is desirable, including the question of the
                                                              desirability of the general introduction of equal
                                                              representation of shareholders and employees on the
                                                              supervisory or administrative organ;
                                                              Whereas the provisions of this Directive are without
                                                              prejudice to the provisions of Directive . . . on pro-
                                                              cedures for informing and consulting the employees of
                                                              undertakings with complex structures, in particular
                                                              transnational undertakings (');
Whereas the members of the management and                     Unchanged.
supervisory organs must be made subject to special
rules relating to civil liability which provide for joint
and several liability, reverse the burden of proof in
respect of liability for wrongful acts and ensure that
the bringing of proceedings on behalf of the company
for the purpose of making those persons liable is not
improperly prevented;
Whereas, as regards the preparation and holding of             Unchanged.
general meetings, the shareholders must be protected
by equivalent provisions relating to the form, content
and period of notice, the right to attend and to be
represented at meetings, written or oral information,
exercise of the right to vote, the majorities required
for the passing of resolutions and, finally, the right to
                                                               (') See proposal for this Directive O J N o C 297, 15. 11.
                                                                   1980, p. 3.
 ---pagebreak---  9. 9. 83                          Official Journal of the European Communities                             No C 240/5
                      ORIGINAL PROPOSAL                                             AMENDED PROPOSAL
 bring proceedings in respect of void or voidable
 resolutions:
 Whereas certain rights of shareholders should be
 capable of being exercised by a minority of them;
 Whereas, in the interests of members and others, the           Whereas, in the interests of members and others,
 audit of the annual accounts should be carried out by          provisions are also necessary concerning the adoption
 experts whose independence is guaranteed by special            of the annual accounts, and in particular the
 provisions,                                                    independence and responsibility of the auditors of
                                                                those accounts;
                                                                Whereas, pending subsequent coordination, the
                                                                application of certain provisions of this Directive may
                                                                need to be qualified where a public limited company is
                                                                a member of a group,
 HAS ADOPTED THIS DIRECTIVE:                                    Unchanged.
                                                                                      CHAPTER I
                    Scope of application                                          Scope of application
                          Article 1                                                     Article 1
1.     The coordination measures prescribed by this             1.   The coordination measures prescribed by this
Directive apply to the laws, regulations and                   Directive shall apply to the laws, regulations and
administrative provisions of the Member States                 administrative provisions of the Member States
relating to the following types of company:                    relating to the following types of company:
— in Germany: die Aktiengesellschaft,                          — in Germany: die Aktiengesellschaft,
— in Belgium: la societe anonyme/de              naamloze      — in Belgium: la societe anonyme/de            naamloze
    vennootschap,                                                  vennootschap,
— in France: la societe anonyme,                               — in Denmark: aktieselskabet,
— in Italy: la societa per azioni,                             — in France: la societe anonyme,
— in Luxembourg: la societe anonyme,                           — in Greece: avrfwufni Eiaipeia,
— in the Netherlands: de naamloze vennootschap.                — in Ireland: the public company limited by shares
                                                                   and the public company limited by guarantee and
                                                                   having a share capital,
                                                               — in Italy: la societa per azioni,
                                                               — in Luxembourg: la societe anonyme,
                                                               — in the Netherlands: de naamloze vennootschap,
                                                               — in the United Kingdom: the public company
                                                                   limited by shares and the public company limited
                                                                   by guarantee and having a share capital.
2.     It shall be permissible for the Member States not       2.    It shall be permissible for the Member States not
to apply the provisions of this Directive to                   to apply this Directive to cooperatives set up in one of
cooperatives whose legal form is that of one of the            the legal forms indicated in paragraph 1. To the
types of company indicated in the foregoing                    extent that the laws of the Member States make use
paragraph.                                                     of this possibility, they shall require these companies
                                                               to include the word 'cooperative' on all the documents
                                                               to which reference is made in Article 4 of Directive
                                                               68/151/EEC.
 ---pagebreak--- No C 240/6                           Official Journal of the European Communities                           9. 9. 83
                   ORIGINAL PROPOSAL                                               AMENDED PROPOSAL
                      CHAPTER I                                                      CHAPTER II
               Structure of the company                                        Structure of the company
                        Article 2                                                      Article 2
1.    The Member States shall make provision so that         1.     The Member States shall provide that the
the structure of the company takes the form provided         company shall be organized according to a two-tier
for in Chapters II and III of this Directive, the            system (management organ and supervisory organ) in
company thereby having not less than three separate          accordance with Chapter III. They may, however,
organs:                                                      permit the company to have a choice between a two-
(a) the management organ responsible for managing            tier system organized in accordance with Chapter III
    and representing the company;                            and a one-tier system (administrative organ) in
                                                             accordance with the provisions of Chapter IV.
(b) the supervisory organ responsible for controlling
    the management organ;
(c) the general meeting of shareholders.
2.    They shall, further, make provision for the            2. The Member States shall in addition make
annual accounts to be drawn up and audited in                provision for the general meeting of shareholders in
manner provided in Chapter IV of this Directive.             accordance with Chapter V and the drawing up and
                                                             auditing of annual accounts in accordance with
                                                             Chapter VI.
                      CHAPTER II                                                    CHAPTER III
                                                                               THE TWO-TIER SYSTEM
                                                                                      Section 1
   The management organ and the supervisory organ                The management organ and the supervisory organ
                        Article 3                                                      Article 3
1.    The members of the management organ shall be           1. (a) The company shall be managed by a
appointed by the supervisory organ.                                  management organ under the supervision of a
                                                                     supervisory organ.
                                                                 (b) The members of the management organ shall be
                                                                     appointed by the supervisory organ. However,
                                                                     the members of the first management organ
                                                                     may be appointed in the memorandum or
                                                                     articles of association.
2.    Where the management organ has more than               2.     Where the management organ has several
one member, the supervisory organ shall specify              members, the supervisory organ shall specify which
which member of the management organ is reponsible           member of the management organ is more parti-
for questions of personnel and worker relations.             cularly responsible for questions of personnel and
                                                             employee relations.
3.    The provisions of this Article shall be without        3.     The provisions of this Article shall be without
prejudice to national laws under which the                   prejudice to national laws under which the
appointment or dismissal of any member of the                appointment or dismissal of any member of the
management organ cannot be effected against the              management organ cannot be effected against the
wishes of the majority of the members of the                 wishes of the majority of the members of the
 supervisory organ who were appointed by the                 supervisory organ who were appointed by the
workers or by their representatives.                         employees.
                        Article 4                                                       Article 4
1.    The laws of the Member States shall make                1.    In companies employing in the Community on
provisions that, at any rate for companies which             average less than a number of persons which the
employ 500 staff or more, the appointment of                 legislation of the Member States cannot fix at more
members of the supervisory organ shall be made in            than 1 000, the members of the supervisory organ
manner provided in paragraphs 2 or 3.                        shall be appointed by the general meeting. For the
                                                             purposes of this calculation, persons employed by sub-
                                                             sidiary undertakings of a company according to the
                                                             legislation applicable to that company in conformity
 ---pagebreak--- 9. 9. 83                         Official Journal of the European Communities                           No C 240/7
                    ORIGINAL PROPOSAL                                            AMENDED PROPOSAL
                                                              with Article 1 of Directive 83/349/EEC shall be
                                                              considered to be employees of that company.
2.    Without prejudice to the provisions contained in       2.    In respect of companies employing on average a
the following subparagraphs, the members of the              number of persons which equals or exceeds the
supervisory organ shall be appointed by the general          number fixed in accordance with paragraph 1, the
meeting.                                                     Member States shall provide for employee parti-
Not less than one-third of the members of the                cipation in the appointment of members of the
supervisory organ shall be appointed by the workers          supervisory organ in accordance with Articles 4b or
or their representatives or upon proposal by the             4c.
workers or their representatives.                            However, as an alternative to employee participation
The laws of the Member States may provide in                 in accordance with these Articles, Member States may
relation to the appointment of members of the                provide for employee participation through a body
supervisory board that some of those who are not             representing the company's employees in accordance
appointed in manner provided in the preceding                with Article 4d or through collectively agreed systems
subparagraphs may be appointed otherwise than by             in accordance with Article 4e. In all cases, Member
the general meeting.                                         States may provide that employee participation shall
                                                             not be implemented in respect of a company when a
                                                             majority of the employees has expressed its opposition
                                                             to such participation.
3.    The members of the supervisory organ shall be          3.    Where the average number of a company's
appointed by that organ. However, the general                employees rises above or falls below the number fixed
meeting or the representatives of the workers may            in accordance with paragraph 1, that fact need not
object to the appointment of a proposed candidate on         affect the application of paragraphs 1 or 2 until the
the ground either that he lacks the ability to carry out     average number of employees has exceeded or fallen
his duties or that if he were appointed there would,         below that number for two consecutive years.
having regard to the interests of the company, the
shareholders or the workers, be imbalance in the
composition of the supervisory organ. In such cases
the appointment shall not be made unless the
objection is declared unfounded by an independent
body existing under public law.
4.     As regards companies which employ a lesser            4.    The members of the first supervisory organ may
number of workers than that fixed in pursuance of            be appointed in the memorandum or articles of
paragraph 1, the members of the supervisory organ            association.
shall be appointed by the general meeting.
5.     The members of the first management organ             Deleted (but see Article 4 (4) above).
and of the first supervisory organ may be appointed
in the statutes or in the instrument of constitution.
                                                                                     Article 4a
(See Article 4 (2) above)                                    By way of derogation from Articles 4 (1), 4b (1), and
                                                             4c (1), the laws of the Member States may provide
                                                             that not more than one-third of the members of the
                                                             supervisory organ may be appointed otherwise than as
                                                             provided in those Articles. However, where Article
                                                             4b (1) applies, the minimum employee representation
                                                             therein specified shall always be respected unless the
                                                             conditions specified in the last sentence of Article
                                                             4 (2) have been fulfilled.
                                                                                     Section 2
                                                             Employee     participation in the appointment       of
                                                                        members of the supervisory organ
                                                                                     Article 4b
(See Article 4 (2) above)                                     1.   The members of the supervisory organ shall be
                                                             appointed by the general meeting as regards a
 ---pagebreak--- No C 240/8                           Official Journal of the European Communities                             9. 9. 83
                    ORIGINAL PROPOSAL                                            AMENDED PROPOSAL
                                                             maximum of two-thirds and by employees of the
                                                             company as regards a minimum of one-third but
                                                             subject to a maximum of one-half.
                                                             2.     Where employees appoint one-half of the
                                                             members of the supervisory organ, its voting pro-
                                                             cedures shall ensure that decisions may ultimately be
                                                             taken by the members appointed by the general
                                                             meeting.
                                                                                     Article 4c
(See Article 4 (3) above)                                    1.     The members of the supervisory organ shall be
                                                             appointed by co-optation by that organ. However, the
                                                             general meeting or a committee of shareholders
                                                             designated by that meeting or the representatives of
                                                             the employees may object to the appointment of a
                                                             proposed candidate on the ground either that he lacks
                                                             the ability to carry out his duties or that if he were
                                                             appointed the supervisory organ would, having regard
                                                             to the interests of the company, the shareholders and
                                                             the employees, be improperly constituted. In such
                                                             cases, the appointment shall not be made unless the
                                                             objection is declared unfounded by an independent
                                                             body existing under public law.
                                                                                     Section 3
                                                             Employee participation through a body representing
                                                                                company employees
                                                                                     Article 4d
                                                              1.    A body representing the employees shall have the
                                                             right, in relation to the company's management organ,
                                                             to regular information and consultation on the
                                                             administration, situation, progress and prospects of the
                                                             company, its competitive position, credit situation and
                                                             investment plans. It shall also have the same rights to
                                                             information as those conferred on the members of the
                                                             supervisory organ by Article 11.
                                                              2.    In addition, in the cases referred to in Article
                                                              12 (1), the body representing the employees must be
                                                              consulted before the supervisory organ considers
                                                             whether to grant authorization. Where the supervisory
                                                              organ does not comply with the opinion given, it shall
                                                              communicate its reasons to the body representing the
                                                              employees. The law, the memorandum or the articles
                                                              of association may make other operations subject to
                                                              this duty of consultation.
                                                              3.    The second and third sentences of Article
                                                              10a (2) shall apply to the members of the body
                                                              representing the employees.
                                                              4.    The body representing the employees shall meet
                                                              at regular intervals, and at least immediately prior to
                                                              each meeting of the supervisory organ, and shall be
                                                              given all the documentation and information
                                                              connected with the agenda of the meeting of the
 ---pagebreak--- 9. 9. 83             Official Journal of the European Communities                            No C 240/9
         ORIGINAL PROPOSAL                                            AMENDED PROPOSAL
                                                  supervisory organ needed for its deliberations. At the
                                                  request of the body representing the employees, the
                                                  chairman of the supervisory organ, his deputy or a
                                                  member of the management organ shall attend its
                                                                          Section 4
                                                  Employee participation through collectively agreed
                                                                           systems
                                                                          Article 4e
                                                  1.    Employee participation shall be regulated in
                                                  accordance with collective agreements concluded
                                                 between the company or an organization representing
                                                  the company and organizations representing its
                                                 employees.
                                                  2.    Collective agreements concluded pursuant to
                                                 paragraph 1 shall respect the provisions of this Section
                                                 and of Article 4i and make provisions at least for
                                                 employee participation in the supervisory organ in
                                                 accordance with Article 4f or for employee represen-
                                                 tation in accordance with Article 4g.
                                                                          Article 4f
                                                 1.     The members of the supervisory organ shall be
                                                 appointed in accordance with Articles 4b or 4c.
                                                 2.     Articles 5 to 21 shall apply.
                                                                          Article 4g
                                                 1.     Employee representatives shall have the right in
                                                 relation to the company's management organ to
                                                 regular information and consultation on the
                                                 administration, situation, progress and prospects of the
                                                 company, its competitive position, credit situation, and
                                                 investment plans. They shall also have the same rights
                                                 to information as those conferred on the members of
                                                 the supervisory organ by Article 11.
                                                 2.     In addition, in the cases referred to in Article
                                                 12 (1), the law or the collective agreements concluded
                                                 pursuant to Article 4e shall provide at least that
                                                 employee representatives must be consulted before the
                                                 supervisory organ considers whether to grant auth-
                                                 orization. Where the supervisory organ does not
                                                 comply with the opinion given, it shall communicate
                                                 its reasons to the employee representatives. The law,
                                                 the collective agreements, the memorandum or the
                                                 articles of association may make other operations
                                                 subject to this duty of consultation.
                                                 3.    The second and third sentences of Article
                                                 10a (2) shall apply to employee representatives who
                                                 receive information of a confidential nature pursuant
                                                 to paragraphs 1 and 2.
                                                 4.    Article 4d (4) shall apply to the employee rep-
                                                 resentatives.
 ---pagebreak--- No C 240/10                          Official Journal of the European Communities                            9.9.83
                   ORIGINAL PROPOSAL                                            AMENDED PROPOSAL
                                                                                     Article 4h
                                                            1.    The Member States shall provide that, where
                                                            collective agreements are not concluded pursuant to
                                                            Article 4e before the end of a period of not more than
                                                            one year after the expiry of the period referred to
                                                            in Article 64 (2), employee participation shall be
                                                            regulated in accordance with Articles 4b, 4c or 4d.
                                                             2.    The Member States shall further provide that,
                                                            where a collective agreement concluded pursuant to
                                                            Article 4e comes to an end and a suibsequent
                                                            agreement is not concluded within a period of one
                                                            year, employee participation shall be regulated in
                                                            accordance with Articles 4b, 4c or 4d.
                                                                                    Section 5
                                                             Principles as to appointment of employee represen-
                                                                                       tatives
                                                                                     Article 4i
                                                             To the extent that the employees must participate in
                                                             the appointment of members of the supervisory organ
                                                             in accordance with Articles 4b or 4c or through a
                                                             body representing the company's employees in
                                                             accordance with Article 4d or through collectively
                                                             agreed systems in accordance with Article 4e, the
                                                             Member States shall ensure that the following
                                                             principles are observed:
                                                             (a) the relevant members of the supervisory organ
                                                                 and representatives of the employees shall be
                                                                 elected in accordance with systems of proportional
                                                                 representation ensuring that minorities are
                                                                 protected;
                                                             (b) all employees must be able to participate in the
                                                                 election;
                                                             (c) the elections shall be by secret ballot;
                                                             (d) free expression of opinion shall be guaranteed.
                                                                                     Section 6
                                                              Members of the management and supervisory organs
                       Article 5                                                      Article 5
1.    Only natural persons may be appointed as               Unchanged.
members of the management organ.
2.    Where the laws of the Member States provide
that legal persons may be members of the supervisory
organ, those legal persons shall designate a
permanent representative who shall be subject to the
same conditions and obligations as if he were
personally a member of the supervisory organ, but
without prejudice to the liability of the legal person
which he represents.
                        Article 6                                                     Article 6
No person may be at the same time a member of the            Unchanged.
management organ and of the supervisory organ..
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                    ORIGINAL PROPOSAL                                              AMENDED PROPOSAL
                         Article 7                                                     Article 7
 The members of the management organ and of the               1.    The members of the supervisory organ shall be
 supervisory organ shall be appointed for a specified         appointed for a specified period not exceeding six
period not exceeding six years. They shall be eligible        years. They shall be eligible for reappointment.
 for reappointment.
                                                              2.    In respect of companies employing on average a
                                                              number of persons which equals or exceeds the
                                                              number fixed in accordance with Article 4 (1), the
                                                              members of the management organ shall be appointed
                                                              for a specified period not exceeding six years. They
                                                              shall be eligible for reappointment.
                        Article 8                                                      Article 8
The management organ and the supervisory organ                The management organ and the supervisory organ
shall not fix the remuneration of their own members.          shall not fix the remuneration of their own members.
                                                              The management organ shall not fix the remuneration
                                                              of the members of the supervisory organ.
                        Article 9                                                      Article 9
 1.    The members of the management organ shall                    Unchanged.
 not, without the authorization of the supervisory
organ, carry on within another undertaking any
activity, whether remunerated or not, for their own
 account of any other person.
2.     The general meeting shall be informed each year        2.    The general meeting shall be informed of the
of the authorizations given.                                 authorizations given.
3.     A natural person shall not be a member of the          3.    Before a natural person can be appointed a
supervisory organ of more than 10 companies.                 member of the supervisory organ, the organs or
                                                             persons which are empowered to make or object to
                                                             appointments shall be informed of any activity carried
                                                             on by that person within another undertaking,
                                                             whether remunerated or not, for his own account or
                                                             for the account of any other person.
                       Article 10                                                     Article 10
1.     Every agreement to which the company is party         1.     Unchanged.
and in which a member of the management organ or
of the supervisory organ has an interest, even if only
indirect, must be authorized by the supervisory organ
at least.
2.     Where a member of the management organ or             2.     Where a member of the management organ or
supervisory organ becomes aware that such circum-            supervisory organ becomes aware that such circum-
stances as are described in paragraph 1 obtain, he           stances as are described in paragraph 1 obtain, he
shall inform those two organs thereof. The interested        shall inform those two organs thereof. The interested
member shall not take part either in the discussion or       member shall have the right to be heard but may not
decision relating to the giving of the authorization         take part in the discussion or in the decision relating
required under paragraph 1 within the supervisory            to the relevant agreement within the management
organ.                                                       organ or the decision relating to the giving of the
                                                             authorization required under paragraph 1 within the
                                                             supervisory organ.
3.     The general meeting shall be informed each year       3.    The general meeting shall be informed of the
of the authorizations given under paragraph 1.               authorizations given under paragraph 1.
4.     Want of authorization by the supervisory organ        4.     Unchanged.
or irregularity in the decision giving authorization
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                    ORIGINAL PROPOSAL                                              AMENDED PROPOSAL
shall not be adduced as against third parties save
where the company proves that the third party was
aware of the want of authorization or of the irre-
gularity in the decision, or that in view of the circum-
stances he could not have been unaware thereof.
                                                                                      Article 10a
                                                                1.    All members of the management and supervisory
                                                               organs shall have the same rights and duties as other
                                                               members of the same organ, without prejudice to
                                                               provisions which make it possible for the functions of
                                                               these organs to be allocated among their members.
                                                               2.     All the members of the management and
                                                               supervisory organs shall carry out their functions in
                                                               the interest of the company, having regard to the
                                                               interests of the shareholders and employees. They
                                                               shall exercise a proper discretion in respect of infor-
                                                               mation of a confidential nature concerning the
                                                               company. This duty shall continue to apply even after
                                                               they have ceased to hold office.
                                                                                      Section 7
                                                                Information of and authorization by the supervisory
                                                                                         organ
                        Article 11                                                     Article 11
 1.    The management organ shall, not less than                1.    The management organ shall, not less than
every three months, send to the supervisory organ a             every three months, send to the supervisory organ a
report on the progress of the company's affairs.               written report on the progress of the company's
                                                                affairs.
2.     The management organ shall, within three                2.     The management organ shall, within five
months following the end of each financial year,               months following the end of each financial year,
present to the supervisory organ the draft annual              present to the supervisory organ the draft annual
accounts and draft annual report within the meaning            accounts and draft annual report within the meaning
of Articles 2 and 43 of Directive . . . of . . .               of Articles 2 and 46 of Directive 78/660/EEC.
3.    The supervisory organ may at any time request            3.     At the request of the supervisory organ, the
from the management organ a special report on the              management organ shall furnish a special report on
affairs of the company or on certain aspects thereof.          the affairs of the company or on certain aspects
                                                               thereof.
4.    The supervisory organ or one-third of the                4.     The supervisory organ shall be entitled to
members thereof shall be entitled to obtain from the           undertake or cause to be undertaken all investigations
management organ all information and relevant                  which may be necessary. At the request of at least
documents and to undertake all such investigations as          one-third of the members of the supervisory organ the
may be necessary. The supervisory organ may                    management organ shall furnish all information and
authorize one or more of its members or one or more            documents necessary to the exercise of its supervision.
experts to exercise these powers.
5.    Each member of the supervisory organ shall be            5.     Unchanged.
entitled to examine all reports, documents and infor-
mation supplied by the management organ to the
supervisory organ.
 ---pagebreak--- 9. 9. 83                         Official Journal of the European Communities                              No C 240/13
                     ORIGINAL PROPOSAL                                           AMENDED PROPOSAL
                         Article 12                                                  Article 12
 1.    The authorization of the supervisory organ shall       1.     Unchanged.
be obtained for decisions of the management organ
 relating to:
 (a) the closure or transfer of the undertaking or of
     substantial parts thereof;
 (b) substantial curtailment or        extension  of  the
     activities of the undertaking;
 (c) substantial organizational changes within the
     undertaking;
 (d) establishment of long-term cooperation with
     other undertakings or the termination thereof.
 2.    The law or the statutes may provide that the           2.     The law, the memorandum or the articles of
 authorization of the supervisory organ must be               association may provide that the authorization of the
 obtained also for the effecting of other operations.         supervisory organ must be obtained also for the
                                                              effecting of other operations.
3.     The provisions of Article 10 (4) shall apply as        3.     Unchanged.
regards third parties.
                                                                                     Section 8
                                                              Dismissal of members of management and supervisory
                                                                                       organs
                         Article 13                                                  Article 13
 1.    The members of the management organ may be             1.    Unchanged.
dismissed by the supervisory organ.
2.     The members of the supervisory organ may be            2.    The members of the supervisory organ may be
dismissed at any time by the organs or persons who            dismissed at any time by the organs or persons who
appointed them and under the same procedures.                 appointed them and under the same procedures.
However, the members of the supervisory organ who             However, the members of the supervisory organ who
were appointed by it under Article 4 (3) may be               were appointed by it under Article 4c may be
dismissed only where proper grounds for dismissal are         dismissed only where proper grounds for dismissal are
found to exist by judgment of the court in                    found to exist by judgment of a court in proceedings
proceedings brought in that behalf by the supervisory         brought by the supervisory organ, the general meeting
organ, the general meeting or the workers' rep-               or the employees' representatives.
resentatives.
                                                                                    Section 9
                                                                                   Civil liability
                         Article 14                                                  Article 14
1.     The laws of the Member States shall make such          1.    The laws of the Member States shall make such
provision relating to the civil liability of the members      provision relating to the civil liability of the members
of the management organ and of the supervisory                of the management organ and of the supervisory
organ as to ensure that, at minimum, compensation is          organ as to ensure that, at minimum, compensation is
made for all damage sustained by the company as a             made for all damage sustained by the company as a
result of breaches of law or of the statutes or of other      result of breaches of law or of the memorandum or
wrongful acts committed by the members of those               articles of association or of other wrongful acts
organs in carrying out their duties.                          committed by the members of those organs in
                                                              carrying out their duties.
2.     Each member of the organ in question shall be          2.     Unchanged.
jointly and severally liable without limit. He may,
however, exonerate himself from liability if he proves
that no fault is attributable to him personally.
 ---pagebreak--- No C 240/14                             Official Journal of the European Communities                             9.9.83
                      ORIGINAL PROPOSAL                                             AMENDED PROPOSAL
3.    The provisions of the preceding paragraphs shall          3.    Unchanged.
apply even where the powers vested in the organ have
been allocated among its members.
4.    The authorization given by the supervisory                4.    Unchanged.
organ shall not have the effect of exempting the
members of the management organ from civil liability.
5.     Furthermore, any discharge, instruction or               5.    Unchanged.
authorization given by the general meeting shall not
have the effect of exempting the members of
the management organ or of the supervisory organ
from civil liability.
                          Article 15                                                    Article 15
1.     Proceedings on behalf of the company to                  1.     Unchanged.
enforce the liability referred to in Article 14 shall be
commenced if the general meeting so resolves.
2.     Neither the law nor the statutes may require for         2.     Neither the law nor the memorandum nor the
the passing of a resolution in that behalf a majority           articles of association may require for the passing of
greater than an absolute majority of votes of the               such a resolution a majority greater than an absolute
shareholders present or represented.                            majority of votes of the shareholders present or
                                                                represented.
                          Article 16                                                     Article 16
It shall be provided that proceedings on behalf of the          1.    It shall be provided that proceedings on behalf
company to enforce the liability referred to in Article         of the company to enforce the liability referred to in
 14 shall also be commenced if so requested by one or           Article 14 may also be commenced if so requested on
more shareholders:                                              behalf of and also in the name of the company by one
                                                                or more shareholders:
(a) who hold shares of a certain nominal value or               (a) who hold shares of a certain nominal or
     proportional value which the Member States shall                accounting par value which the Member States
     not require to be greater than 5 % of the capital               shall not require to be greater than 5 % of the
     subscribed;                                                     subscribed capital;
     or                                                              or
(b) who hold shares of a certain nominal value or               (b) who hold shares of a certain nominal or
     proportional value which the Member States shall                accounting par value which the Member States
     not require to be greater than 100 000 units of                 shall not require to be greater than 100 000 ECU.
     account. This figure may vary up to not more                    This figure may vary up to not more than 10 %
     than 10 % for purposes of conversion into                       for purposes of conversion into national currency.
     national currency.
                                                                2.     Should the court dismiss the proceedings
                                                                referred to in paragraph 1, it may order the share-
                                                                holders concerned personally to pay all or part of the
                                                                costs of the case where it considers that no reasonable
                                                                grounds existed for commencing the proceedings.
                          Article 17                                                     Article 17
The bringing of proceedings on behalf of the                    1.     The bringing of proceedings on behalf of the
company to enforce the liability referred to in Article         company to enforce the liability referred to in Article
 14 shall not be made subject, whether by law, the               14 shall not be made subject, whether by law, the
 statutes or any agreement:                                     memorandum or articles of association or any
                                                                agreement:
 (a) to prior resolution of the general meeting or              (a) to prior resolution of the general meeting or
     other organ of the company;                                     other organ of the company;
     or                                                              or
(b) to prior decision of the court in respect of                (b) to prior decision of the court in respect of
     wrongful acts of the members of the management                  wrongful acts of the members of the management
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                     ORIGINAL PROPOSAL                                            AMENDED PROPOSAL
     organ or of the supervisory organ, or in respect               organ or of the supervisory organ, or in respect
     of the dismissal or replacement of members                     of the dismissal or replacement of members
      thereof.                                                      thereof.
                                                                2.    The provisions of the preceding paragraph shall
                                                               not in any way prejudice the right of Member States
                                                               to prescribe by law that the proceedings referred to in
                                                               Article 16 may not be brought without prior
                                                               permission from the court. The court may refuse such
                                                               permission if it considers that the action is clearly
                                                               unfounded.
                         Article 18                                                    Article 18
 1.     Renunciation by the company of the right to                  Unchanged.
bring proceedings on behalf of the company to
enforce the liability referred to in Article 14 shall not
be implied:
(a) from the sole fact that the general meeting has
      approved the accounts relating to the financial
     year during which the acts giving rise to damage
     occurred;
(b) from the sole fact that the general meeting has
     given discharge to the members of the
     management organ or of the supervisory organ in
     respect of that financial year.
2.     For renunciation to take place the following            2.    For renunciation to take place the following
minimum conditions must be satisfied:                          conditions must be satisfied:
(a) an act giving rise to damage must actually have           (a) an act giving rise to damage must actually have
     occurred;                                                     occurred;
(b) the general meeting must expressly resolve to              (b) the general meeting must expressly resolve to
     renounce; the resolution shall in no way affect               renounce; the resolution shall in no way affect
     the right conferred by Article 16 on one or more              the right conferred by Article 16 on one or more
     shareholders who satisfy the requirements of that             shareholders who satisfy the requirements of that
     Article, provided they voted against the resolution           Article, provided they voted against the resolution
     or made objection thereto which was recorded in               or made objection thereto which was recorded in
     the minutes.                                                  the minutes.
3.     This Article shall apply to all compromises             3.    Unchanged.
relating to the bringing of proceedings to enforce the
liability aforesaid which have been agreed between
the company and the member whose liability is in
question.
                         Article 19                                                   Article 19
1.     Proceedings on behalf        of the company to         The provisions of Articles 14 to 18 shall in no way
enforce the liability referred to   in Article 14 may also    restrict the personal liability of members of the organs
be brought by a creditor of         the company who is        of the company towards shareholders personally and
unable to obtain payment from      it.                        towards third parties, pursuant to the general civil law
                                                              set down in national legislation.
2.     Action by the creditor under the preceding
paragraph shall in no way be affected by such renunci-
ation or transactions as are referred to in Article 18.
                         Article 20                                                    Article 20
1.     The Member States shall make such provision             Deleted.
relating to the civil liability of the members of the
management organ and of the supervisory organ as to
ensure that compensation is made for all damage
sustained personally by shareholders and third parties
 ---pagebreak--- No C 240/16                           Official Journal of le European Communities                            9. 9. 83
                    ORIGINAL PROPOSAL                                            AMENDED PROPOSAL
as a result of breaches of law or of the statutes or of
other wrongful acts committed by the members of
those organs in carrying out their duties.
2.    The provisions of Article 14 (2) to (5) shall
apply.
                        Article 21                                                   Article 21
The period in which action to enforce the liability          The period in which an action to enforce the claim
referred to in Articles 14, 19 or 20 may be brought          for damages referred to in Article 14 may be brought
shall not be less than three years from the date of the      shall not be less than three years from the date of the
act giving rise to damage or, if the act has been            act giving rise to damage or, if the act has been
dissembled, from the time when it has become                 dissembled, from the time when it has become
known.                                                       known.
                                                                                   CHAPTER IV
                                                                             THE ONE-TIER SYSTEM
                                                                                    Section 1
                                                                             The administrative organ
                                                                                    Article 21a
                                                             1. (a) The company shall be managed by the
                                                                    executive members of an administrative organ
                                                                    under the supervision of the non-executive
                                                                    members of that organ. The number of non-
                                                                    executive members shall be divisible by three
                                                                    and greater than the number of executive
                                                                    members.
                                                                (b) The executive members of the administrative
                                                                    organ shall be appointed by the non-executive
                                                                    members acting if necessary by a majority.
                                                                    However, the executive members of the first
                                                                    administrative organ may be appointed in the
                                                                    memorandum or articles of association.
                                                             2.    Where the administrative organ has more than
                                                             one executive member, the non-executive members,
                                                             acting if necessary by a majority, shall specify which
                                                             executive member is more particularly responsible for
                                                             questions of personnel and employee relations.
                                                             3.    The provisions of this Article shall be without
                                                             prejudice to national laws under which the
                                                             appointment or dismissal of any member of the
                                                             administrative organ cannot be effected against the
                                                             wishes of the majority of the members of the
                                                             administrative organ who were appointed by the
                                                             employees.
                                                                                    Article 21b
                                                             1.    In companies employing in the Community on
                                                             average less than a number of persons which the
                                                             Member States shall not fix at more than 1 000, the
                                                             non-executive members shall be appointed by the
                                                             general meeting. For the purposes of this calculation,
 ---pagebreak---            Official Journal of the European Communities                            No C 240/17
ORIGINAL PROPOSAL                                           AMENDED PROPOSAL
                                         persons employed by subsidiary undertakings of a
                                         company according to the legislation applicable to that
                                         company in conformity with Article 1 of Directive
                                         83/349/EEC shall be considered to be employees of
                                         that company.
                                         2.   In respect of companies employing on average a
                                         number of persons which equals or exceeds the
                                         number fixed in accordance with paragraph 1, the
                                         Member States shall provide for employee partici-
                                        pation in the appointment of the non-executive
                                         members of the administrative organ in accordance
                                        with Article 2Id. However, as an alternative to
                                        employee participation in accordance with this Article,
                                         Member States may provide for employee partici-
                                        pation through a body representing the company's
                                        employees in accordance with Article 21e or through
                                        collectively agreed systems in accordance with Article
                                        2if. In all cases, Member States may provide that
                                        employee participation shall not be implemented in
                                        respect of a company when a majority of the
                                        employees has expressed its opposition to such partici-
                                        pation.
                                        3.    Where the average number of a company's
                                        employees rises above or falls below the number fixed
                                        in accordance with paragraph 1, that fact need not
                                        affect the application of paragraphs 1 or 2 until the
                                        average number of employees has exceeded or fallen
                                        below that number for two consecutive years.
                                        4.    The non-executive members of the first
                                        administrative organ may be appointed in the
                                        memorandum or articles of association.
                                                               Article 21c
                                        By way of derogation from Articles 21b (1) and 2Id,
                                        the laws of the Member States may provide that not
                                        more than one-third of the members of the
                                        administrative organ may be appointed otherwise than
                                        as provided in those articles. However, where Article
                                        2Id applies, the minimum employee representation
                                        therein specified shall always be respected unless the
                                        conditions specified in the last sentence of Article 21b
                                        (2) have been fulfilled.
                                                               Section 2
                                       Employee participation in the appointment of non-
                                            executive members of the administrative organ
                                                               Article 21d
                                        1.    The non-executive members of the ad-
                                       ministrative organ shall be appointed by the general
                                       meeting as regards a maximum of two-thirds and by
                                       employees of the company as regards a minimum of
                                       one-third but subject to a maximum of one-half.
 ---pagebreak--- No C 240/18                   Official Journal of the European Communities                              9.9.83
            ORIGINAL PROPOSAL                                             AMENDED PROPOSAL
                                                      2.    Where employees appoint one-half of the non-
                                                      executive members of the administrative organ, its
                                                      voting procedures shall ensure that decisions of the
                                                      non-executive members may ultimately be taken by
                                                      the members appointed by the general meeting.
                                                                              Section 3
                                                      Employee participation through a body representing
                                                                         company employees
                                                                              Article 21e
                                                      1.    A body representing the employees shall have the
                                                      right in relation to the company administrative organ
                                                      to regular information and consultation on the
                                                      administration, situation, progress and prospects of the
                                                      company, its competitive position, credit situation and
                                                      investment plans. It shall also have the same rights to
                                                      information as those conferred on the non-executive
                                                      members of the administrative organ by Article 21r.
                                                      2.    In addition, in the cases referred to in Article 21s
                                                      (1), the body representing the employees must be
                                                      consulted before the administrative organ considers
                                                      whether to grant           authorization. Where        the
                                                      administrative organ does not comply with the opinion
                                                      given, it shall communicate its reasons to the body
                                                      representing the employees. The law or the
                                                      memorandum or articles of association may make
                                                      other operations subject to this duty of consultation.
                                                      3.    The second and third sentences of Article 21 q
                                                      (2) shall apply to the members of the body
                                                      representing the employees.
                                                      4.    The body representing the employees shall meet
                                                      at regular intervals, and at least immediately prior to
                                                      each meeting of the administrative organ, and shall be
                                                      given all the documentation and information
                                                      connected with the agenda of the meeting of the
                                                      administrative organ needed for its deliberations. At
                                                      the request of the body representing the employees,
                                                      the chairman of the administrative organ or his deputy
                                                      or an executive member of the administrative organ
                                                      shall attend these meetings.
                                                                              Section 4
                                                       Employee participation through collectively agreed
                                                                                systems
                                                                              Article 21 f
                                                       1.    Employee participation shall be regulated in
                                                       accordance with collective agreements concluded
                                                      between the company or an organization representing
                                                       the company and organizations representing its
                                                       employees.
                                                        2.   Collective agreements concluded pursuant to
                                                        paragraph 1 shall respect the provisions of this Section
                                                        and of Article 21 j and make provisions at least for
 ---pagebreak--- 9.9.83             Official Journal of the European Communities                             No C 240/19
       ORIGINAL PROPOSAL                                              AMENDED PROPOSAL
                                                 employee participation in the administrative organ
                                                 in accordance wirh Article 21g or for employee
                                                 representation in accordance with Article 21h.
                                                                         Article 21g
                                                 1.    The non-executive member of the administrative
                                                organ shall be appointed in accordance with Article
                                                 21d.
                                                2.     Articles 21 j to 21 u shall apply.
                                                                         Article 2lh
                                                1.     Employee representatives shall have the right in
                                                relation to the company's administrative organ to
                                                regular information and consultation on the
                                                administration, progress and prospects of the
                                                company, its competitive position, credit situation, and
                                                investment plans. They shall also have the same rights
                                                to information as those conferred on the non-
                                                executive members of the administrative organ by
                                                Article 21r.
                                                2.     In addition, in the cases referred to in Article
                                                21s, the law or the collective agreements concluded
                                               pursuant to Article 2lf (1) shall provide at least that
                                                employee representatives must be consulted before the
                                                administrative organ considers whether to grant auth-
                                                orization. Where the administrative organ does not
                                               comply with the opinion given, it shall communicate
                                               its reasons to the employee representatives. The law,
                                               the collective agreements or the memorandum or
                                                articles of association may make other operations
                                                subject to this duty of consultation.
                                                3.    The second and third sentences of Article 21q
                                                (2) shall apply to employee representatives who
                                               receive information of a confidential nature pursuant
                                               to paragraphs 1 and 2.
                                               4. Article 21e (4)        shall apply to   the  employee
                                               representatives.
                                                                         Article 21i
                                                1.    The Member States shall provide that, where
                                               collective agreements are not concluded pursuant to
                                               Article 2 if before the end of a period of not more
                                               than one year after the expiry of the period referred
                                               to in Article 64 (2), employee participation shall be
                                               regulated in accordance with Article 2Id or 21e.
                                                2.    The Member States shall further provide that,
                                               where a collective agreement concluded pursuant to
                                               Article 2If comes to an end and a subsequent
                                               agreement is not concluded within a period of one
                                               year, employee participation shall be regulated in
                                               accordance with Article 2id or 2le.
 ---pagebreak--- No C 240/20                   Official Journal of the European Communities                             9.9.83
            ORIGINAL PROPOSAL                                            AMENDED PROPOSAL
                                                                              Section 5
                                                      Principles as to appointment of employee represen-
                                                                                tatives
                                                                              Article 21 j
                                                      To the extent that the employees must participate in
                                                      the appointment of non-executive members of the
                                                      administrative organ in accordance with Article 2id,
                                                      or through a body representing the employees in
                                                      accordance with Article 21e, or through collectively
                                                      agreed systems in accordance with Article 2 if, the
                                                      Member States shall ensure that the following
                                                      principles are observed:
                                                      (a) the relevant members of the administrative organ
                                                          and representatives of the employees shall be
                                                          elected in accordance with systems of proportional
                                                          representation ensuring that minorities are
                                                          protected;
                                                      (b) all employees must be able to participate in the
                                                          elections;
                                                      (c) the elections shall be by secret ballot;
                                                      (d) free expression of opinion shall be guaranteed.
                                                                              Section 6
                                                               Members of the administrative organ
                                                                             Article 21k
                                                      1.    Only natural persons may be appointed as
                                                      executive members of the administrative organ.
                                                      2.    Where the laws of the Member States provide
                                                      that legal persons may be non-executive members of
                                                      the administrative organ, those legal persons shall
                                                      designate a permanent representative who shall be
                                                      subject to the same conditions and obligations as if he
                                                      were personally a member of the administrative organ,
                                                      but without prejudice to the liability of the legal
                                                      person which he represents.
                                                                              Article 211
                                                      No person may be at the same time an executive and a
                                                      non-executive member of the administrative organ.
                                                                             Article 21m
                                                      1.    The non-executive members of the ad-
                                                      ministrative organ shall be appointed for a specified
                                                      period not exceeding six years. They shall be eligible
                                                      for reappointment.
                                                      2.    In respect of companies employing on average a
                                                      number of persons which equals or exceeds the
                                                      number fixed in accordance with Article 21b (1), the
                                                      executive members of the administrative organ shall
                                                      be appointed for a specified period not exceeding six
                                                      years. They shall be eligible for reappointment.
 ---pagebreak--- 9.9.83             Official Journal of the European Communities                            No C 240/21
       ORIGINAL PROPOSAL                                           AMENDED PROPOSAL
                                                                       Article 2 In
                                                Neither the executive nor the non-executive members
                                                of the administrative organ shall fix their own
                                                remuneration. The executive members of the
                                                administrative organ shall not fix the remuneration of
                                                the non-executive members of the administrative
                                                organ.
                                                                       Article 21o
                                                1.    The executive members of the administrative
                                                organ shall not, without the authorization of the non-
                                                executive members, carry on within another under-
                                                taking any activity, whether remunerated or not, for
                                                their own account or for account of any other person.
                                                2.    The general meeting shall be informed of the
                                                authorizations given.
                                                3.    Before a natural person can be appointed a non-
                                                executive member of the administrative organ, the
                                                organs or persons which are empowered to make
                                                appointments shall 1>e informed of any activity carried
                                                on by that person within another undertaking,
                                                whether remunerated or not, for his own account or
                                                for the account of any other person.
                                                                       Article 21p
                                                1.    Every agreement to which the company is party
                                                and in which a member, whether executive or non-
                                                executive of the administrative organ has an interest,
                                                even if only indirect, shall require the authorization at
                                                least of the non-executive members of the
                                                administrative organ.
                                                2.    Where an executive or non-executive member of
                                                the administrative organ becomes aware that such
                                                circumstances as are described in paragraph 1 obtain,
                                                he shall inform the administrative organ thereof. The
                                                interested member shall have the right to be heard but
                                                may not take part in the discussion or in the decision
                                                of the executive members relating to the relevant
                                                agreement or in the decision of the non-executive
                                                members of the administrative organ relating to the
                                                giving of the authorization referred to in paragraph 1.
                                                3.    The general meeting shall be informed of the
                                                authorizations given under paragraph 1.
                                                4.    Want of authorization by the administrative
                                                organ or irregularity in the decision giving author-
                                                ization shall not be adduced as against third parties
                                                save where the company proves that the third party
                                                was aware of the want of authorization or of the irreg-
                                                ularity in the decision, or that in view of the circum-
                                                stances he could not have been unaware thereof.
                                                                       Article 21q
                                                 1.   All the executive members of the administrative
                                                organ shall have the same rights and duties, without
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            ORIGINAL PROPOSAL                                             AMENDED PROPOSAL
                                                      prejudice to provisions making it possible for the
                                                      functions of this organ to be allocated amongst its
                                                      members. The same shall apply to the non-executive
                                                      members.
                                                      2.    All the members of the administrative organ
                                                      shall carry out their functions in the interest of the
                                                     company, having regard to the interest of the share-
                                                      holders and the employees. They shall exercise a
                                                     proper discretion in respect of information of a
                                                     confidential nature concerning the company. This duty
                                                     shall continue to apply even after they have ceased to
                                                     hold office.
                                                                              Section 7
                                                      Information of, and authorization by, the non-
                                                           executive members of the administrative organ
                                                                              Article 21r
                                                      1.    The executive members of the administrative
                                                      organ shall, not less than every three months, present
                                                      to the non-executive members a written report on the
                                                      progress of the company's affairs.
                                                      2.    The executive members of the administrative
                                                      organ shall, within five months following the end of
                                                      each financial year, present to the non-executive
                                                      members the draft annual accounts and draft annual
                                                      report within the meaning of Articles 2 and 46 of
                                                      Directive 78/660/EEC.
                                                      3.    At the request of the non-executive members of
                                                      the administrative organ, the executive members shall
                                                      furnish a special report on the affairs of the company
                                                      or on certain aspects thereof.
                                                      4.    The      non-executive      members     of     the
                                                      administrative organ shall be entitled to undertake or
                                                      cause to be undertaken all investigations which may be
                                                      necessary. At the request of at least one-third of the
                                                      non-executive members, the executive members shall
                                                      furnish all information and documents necessary to
                                                      the exercise of their supervision.
                                                      5.    Each       non-executive      member    of     the
                                                      administrative organ shall be entitled to examine all
                                                      reports, documents and information supplied by the
                                                      executive members to another non-executive member.
                                                                              Article 21s
                                                      1.    The administrative organ shall not be able to
                                                      delegate power to decide on the following operations:
                                                      (a) the closure or transfer of the undertaking or of
                                                           substantial parts thereof;
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                    ORIGINAL PROPOSAL                                             AMENDED PROPOSAL
                                                             (b) substantial curtailment or          extension   of the
                                                                  activities of the undertaking;
                                                             (c) substantial organizational        changes   within the
                                                                  undertaking;
                                                             (d) establishment of long-term cooperation with other
                                                                  undertakings or the termination thereof.
                                                             2.     The law or the memorandum or articles of
                                                             association may prohibit delegation of the power to
                                                             decide on other operations.
                                                             3.     The provisions of Article 21p (4) shall apply as
                                                             regards third parties.
                                                                                     Section 8
                                                                Dismissal of members of the administrative organ
                                                                                     Article 211
                                                             1.    The executive members of the administrative
                                                             organ may be dismissed by the non-executive members
                                                             acting by majority.
                                                             2.    The non-executive members of the ad-
                                                             ministrative organ may be dismissed at any time by the
                                                             organs or persons who appointed them and under the
                                                             same procedures.
                                                                                     Section 9
                                                                                    Civil liability
                                                                                     Article 21u
                                                            The provisions of Articles 14 to 21 shall apply to the
                                                            executive and non-executive members of the
                                                            administrative organ.
                      CHAPTER III                                                   CHAPTER V
                  GENERAL MEETING                                               GENERAL MEETING
                        Article 22                                                   Article 22
1.    The general meeting shall be convened at least         1.    Unchanged.
once each year.
2.    It may be convened         at any time by the         2.     It may be convened at any time by the
management organ.                                           management organ or by the executive members of
                                                            the administrative organ.
                        Article 23                                                    Article 23
1.    It shall be provided that one or more share-           1.    It shall be provided that one or more share-
holders who satisfy the requirements of Article 16          holders who satisfy the requirements of Article 16 (1)
may request the company to convene the general              may request the company to convene the general
meeting and settle the agenda therefor.                     meeting and settle the agenda therefor.
2.    If, following a request made under paragraph 1,       2.     Unchanged.
no action has been taken by the company within one
month, the competent court must have power to
 ---pagebreak---  No C 240/24                          Official Journal of the European Communities                            9.9.83
                    ORIGINAL PROPOSAL                                            AMENDED PROPOSAL
convene the general meeting or to authorize it to be
convened either by the shareholders who requested
that it be convened or by their agents.
                        Article 24                                                   Article 24
 1.    The laws of the Member States may provide             1. (a)   The laws of the Member States may provide
 that the general meeting of a company all of whose                   that the general meeting of a company all of
 shares are registered may be convened by notice sent                 whose shares are registered may be convened
 by registered letter. In every other case the meeting                by notice sent by any means of communi-
 shall be convened by notice published at least in the                cation which permits verification that it has
 company's national gazette designated in that behalf                 been sent to every shareholder and the date
 pursuant to Article 3 (4) of Directive 68/151/EEC of                 on which it was sent.
 9 March 1968.                                                  (b)   In every other case the meeting shall be
                                                                      convened by notice published at least in the
                                                                      national gazette designated pursuant to Article
                                                                      3 (4) of Directive 68/151/EEC.
2.     The notice shall contain the following par-           2.    (a) to (c) unchanged;
ticulars at least:
(a) the name of the company and the address of its
     registered office;
(b) the place and date of the meeting;
(c) the type of general meeting (ordinary, extra-
     ordinary or special);
(d) a statement of the formalities, if any, prescribed       (d) a statement of the formalities, if any, prescribed
     by the statutes for attendance at the general               by the memorandum or articles of association for
     meeting and for the exercise of the right to vote;           attendance at the general meeting and for the
                                                                 exercise of the right to vote;
(e) any provisions of the statutes which require the         (e) any provisions of the memorandum or articles of
     shareholder, where he appoints an agent, to                 association which require the shareholder, where
     appoint a person who falls within certain specified         he appoints an agent, to appoint a person who
     categories of persons;                                      falls within certain specified categories of
                                                                 persons;
(f) the agenda;                                              (f) and (g) unchanged.
(g) the wording of proposed resolutions concerning
     each of the items on the agenda.
3.     The length of the period between the date of          3.    The length of the period between the date of
dispatch by registered letter of the first notice of         either the dispatch of the first notice of general
meeting and the date of the first meeting of the             meeting by the means referred to in paragraph 1 (a),
general meeting shall be not less than two weeks, and        or the first publication of the notice of general
the length of the period between the date of first           meeting in accordance with paragraph 1 (b), and the
publication of the notice of meeting and the date of         date of the first general meeting shall be not less than
the first meeting of the general meeting shall be not        21 days.
less than one month.
                        Article 25                                                   Article 25
 1.    It shall be provided that one or more share-          1.    It shall be provided that one or more share-
holders who satisfy the requirements of Article 16           holders who satisfy the requirements of Article 16 (1)
may request that one or more new items be included           may request that one or more new items be included
in the agenda of a general meeting of which notice           in the agenda of a general meeting of which notice
has already been given.                                      has already been given.
2.     Requests for inclusion of new items in the            2.    Requests for inclusion of new items in the
agenda shall be sent to the company within five days         agenda shall be sent to the company within seven
following the date of dispatch by registered letter of       days following the date of either dispatch of the first
the first notice of general meeting or within 10 days        notice of general meeting by the means referred to in
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                      ORIGINAL PROPOSAL                                            AMENDED PROPOSAL
 following the first publication of the notice of general       Article 24 (1) (a) or the first publication of the notice
 meeting.                                                       of general meeting in accordance with Article 24
                                                                (i) 0>).
 3.     The items whose inclusion in the agenda has             3.    Items whose inclusion in the agenda has been
 been requested under the last foregoing paragraph              requested under paragraph 2 shall be communicated
 shall be communicated or published in the same way             or published in the same way as the notice of
 as the notice of meeting, not less than five days or 10        meeting, not less than seven days before the meeting.
 days, respectively, before the meeting.
                          Article 26                                                   Article 26
 Every shareholder who has completed the formalities           Every shareholder who has completed the formalities
 prescribed by law or by the statutes shall be entitled        prescribed by law or by the memorandum and articles
 to attend the general meeting.                                of association shall be entitled to attend the general
                                                               meeting.
                          Article 27                                                   Article 27
 1.    Every shareholder shall be entitled to appoint a         1.    Unchanged.
person to represent him at the general meeting.
2.     The statutes may restrict the choice of rep-            2.    The memorandum or articles of association may
resentative to one or more specified categories of             restrict the choice of representative to one or more
persons. Every shareholder must, however, have the             specified categories of persons. Every shareholder
right to appoint another shareholder to represent him.         must, however, have the right to appoint another
                                                               shareholder to represent him.
3.     The appointment shall be made in writing which          3.    The appointment shall be made in writing, sent
shall be sent to the company and be retained by it for         to the company and be retained by it for not less than
not less than three years.                                     three years from the date of the general meeting.
                         Article 28                                                    Article 28
1.     If any person publicly invites shareholders to          1.      Where national law allows any person to
send their forms of proxy to him and offers to                publicly invite shareholders to send their forms of
appoint agents for them, Article 27 and the following         proxy to him and to offer to appoint agents for them,
provisions shall apply:                                       Article 27 and the following provisions shall apply:
(a) the appointment shall relate only to one meeting;          (a) to (g) unchanged.
     it shall, however, be valid for a second meeting
     having the same agenda;
(b) the appointment shall be revocable;
(c) the invitation shall be sent in writing to every
     shareholder whose name and permanent address
     are known;
(d) the invitation shall contain the following par-
     ticulars ar least:
     (aa) the agenda of the meeting;
     (bb) the wording of proposed              resolutions
           concerning each of the items on the agenda;
     (cc) a statement to the effect that the documents
           referred to in Article 30 are available to any
           shareholder who requests them;
     (dd) a request for instructions concerning the
           exercise of the right to vote in respect of
           each item on the agenda;
     (ee) a statement of the way in which the agent
           will exercise the right to vote if the
           shareholder gives no instructions;
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                        ORIGINAL PROPOSAL                                             AMENDED PROPOSAL
(e) the right to vote shall be exercised in accordance
         with the instructions of the shareholder or, if
         none are given by him, in accordance with the
         statement made to the shareholder;
(f) the agent may, however, depart from the
         instructions given by the shareholder or from the
         statement made to him if circumstances arise
         which were not known at the time the
         instructions or invitation were sent and the
         interests of the shareholder might be detri-
         mentally affected;
 (g) where the right to vote has been exercised in a
          manner contrary to the shareholder's instructions
          or to the statement made to him, the agent shall
          forthwith inform the shareholder and explain the
          reasons therefor.
2.         The provisions of the foregoing paragraph shall        2.    Unchanged.
apply where the company invites the shareholder to
send his form of proxy to it and it appoints an agent
for him.
                            Article 29                                                    Article 29
A list of persons present shall be drawn up in respect            Unchanged.
of each general meeting before any business is
transacted. The list shall contain the following
particulars at least:
(a) the name and permanent address of each                        (a) unchanged;
         shareholder present;
(b) the name and permanent address of each                        (b) unchanged;
         shareholder represented and of the person
         representing him;
(c) the number, class, nominal or proportional value              (c) the number, class and nominal value, or in the
          and number of votes attaching to the shares of              absence of a nominal value, the accounting par
          each shareholder present or represented.                    value and the number of votes attaching to the
                                                                      shares of each shareholder present or represented.
                            Article 30                                                    Article 30
1.         The documents relating to the annual accounts          1.     The annual accounts within the meaning of
within the meaning of Article 2(1) of Directive . . . of          Article 2 (1) of Directive 78/660/EEC, the proposed
. . . ( ' ) together with the report of the persons               appropriation of profit or treatment of loss where it
responsible for auditing the accounts (Article 60 of              docs not appear in the annual accounts, the annual
this Directive) shall be available to every shareholder           report within the meaning of Article 46 of Directive
at latest from the date of dispatch or of publication of          78/660/EEC, and the opinion of the persons
the notice of general meeting convened to examine or              responsible for auditing die accounts within the
adopt the annual accounts and the appropriation of                meaning of Article 58 (2) of this Directive shall be
the results of the financial year                                 available to every shareholder at the latest from the
                                                                  date of dispatch or publication of the notice of general
                                                                  meeting convened to adopt the annual accounts and to
                                                                  decide on the appropriation of profit or treatment of
                                                                  loss or, where it is not competent to adopt the annual
                                                                  accounts, solely to decide on the appropriation of
                                                                  profit or treatment of loss. Every shareholder shall be
                                                                  able to obtain a copy of such documents free of
                                                                  charge upon request. From that same date, the report
                                                                  of the persons responsible for auditing the accounts
                                                                  within the meaning of Article 60 of this Directive shall
                                                                  be made available to any shareholder wishing to
(') O J N o C 7 , 28. 1. 1972.
 ---pagebreak---  9. 9. 83                         Official Journal of the European Communities                            No C 240/27
                     ORIGINAL PROPOSAL                                             AMENDED PROPOSAL
                                                               consult it at the company's registered office and at the
                                                               place where the general meeting is to be held.
 2.     Paragraph 1 shall apply also to contracts in           2.     The first and second sentences of paragraph 1
 respect of which the approval of the general meeting          shall also apply to contracts in respect of which the
 is required.                                                  approval of the general meeting is required.
                         Article 31                                                    Article 31
 1.     Every shareholder who so requests at a general          1.   Unchanged.
 meeting shall be entitled to obtain correct information
 concerning the affairs of the company if such infor-
 mation is necessary to enable an objective assessment
 to be made of the items on the agenda.
 2.    The management organ shall supply the infor-            2.    The management organ or the executive
 mation.                                                       members of the administrative organ shall supply the
                                                               information.
 3.    The communication of information may be                 3.    The communication of information may only be
refused only where:                                            refused where:
(a) communication might cause material detriment to           (a) it would be seriously prejudicial to the company;
     the company;
     or                                                            or
(b) the company is under legal obligation not to               (b) the company is under a legal obligation not to
     divulge the information in question.                          divulge the information in question.
4.     Disputes as to whether a refusal to supply infor-       4.    Unchanged.
mation was justified shall be determined by the court.
                         Article 32                                                   Article 32
 1.    The general meeting shall not pass any                  1.    Unchanged.
resolution concerning items which do not appear on
the agenda.
2.     Paragraph 1 shall not apply provided all the            2.    Unchanged.
shareholders are present or are represented at the
general meeting and no shareholder requires his
objection that the business in question should not be
discussed to be recorded in the minutes.
3.     It shall, however, be permissible for the Member       3.    It shall, however, be permissible for the Member
States not to apply paragraph 1 to resolutions relating       States not to apply paragraph 1 to resolutions relating
to the following matters:                                     to the following matters:
(a) dismissal of members of the management organ              (a) deleted;
     or supervisory organ or of the persons responsible
     for auditing the accounts, provided that at the
     same meeting of the general meeting other
     persons are appointed to replace them;
(b) the bringing of proceedings on behalf of the              (b) the bringing of proceedings on behalf of the
     company to enforce the liability of the members               company to enforce the liability of the members
     of the management organ or of the supervisory                 of the administrative, management or supervisory
     organ, provided that the annual accounts have                 organ, provided that the annual accounts have
     been discussed or been the subject of a resolution            been discussed or have been the subject of a
     at the same meeting;                                          resolution at the same meeting.
(c) the calling of a new meeting.                             (c) unchanged.
                         Article 33                                                   Article 33
 1.    The shareholder's right to vote shall be pro-          1.    The shareholder's right to vote shall be pro-
portionate to the fraction of capital subscribed which        portionate to the fraction of the subscribed capital
the share represents.                                         which the shares represent.
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                    ORIGINAL PROPOSAL                                             AMENDED PROPOSAL
2.     Notwithstanding paragraph 1, the laws of the           2.     Notwithstanding paragraph 1, the laws of the
Member States may authorize the statutes to allow:            Member States may authorize the memorandum and
                                                              the articles of association to allow:
(a) restriction or exclusion of the right to vote in          (a) and (b) unchanged.
     respect of shares which carry special advantages;
(b) restriction of votes in respect of shares allotted to
     the same shareholder, provided the restriction
     applies at least to all shareholders of the same
     class.
3.     In no case may the right to vote be exercised          3.      Any shareholder who, at the date of the general
where payment up of calls made by the company has             meeting, has not paid up calls made by the company at
not been effected.                                            least one month earlier may not exercise his right to
                                                              vote.
                        Article 34                                                      Article 34
Neither a shareholder nor his representative shall            Unchanged.
exercise the right to vote attached to his shares or to
shares belonging to third persons where the subject
matter of the resolution relates to:
(a) discharge of that shareholder;
(b) rights which the company may exercise against
     that shareholder;
(c) the release of that shareholder from his
     obligations to the company;
(d) approval of contracts made between the company
     and that shareholder.
                        Article 35                                                      Article 35
Agreements whereby a shareholder undertakes to                 Unchanged.
vote in any of the following ways shall be void:
 (a) that he will always follow the instructions of the
      company or of one of its organs;
 (b) that he will always approve proposals made by
      the company or by one of its organs;
 (c) that he will vote in a specified manner, or abstain,
      in consideration of special advantages.
                         Article 36                                                     Article 36
 1.     Resolutions of the general meeting shall be            1.    Resolutions of the general meeting shall be
 passed by absolute majority of votes cast by all the         passed by absolute majority of votes cast by all the
 shareholders present or represented, unless a greater        shareholders present or represented, unless a greater
 majority or other requirements be prescribed by law          majority or other additional requirements are pres-
 or by the statutes.                                          cribed by the law or the memorandum or articles of
                                                              association.
2.     The foregoing paragraph shall not apply to the          2.     Paragraph 1 shall not apply to the appointment
appointment of members of the management organ or              of members of the company organs or of the persons
of the supervisory organ or of the persons responsible         responsible for auditing the accounts of the company.
for auditing the accounts of the company.
                        Article 37                                                      Article 37
1.     A resolution of the general meeting shall be            1.    A resolution of the general meeting shall be
required for any alteration of the statutes.                   required for any alteration of the memorandum or
                                                               articles of association.
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                     ORIGINAL PROPOSAL                                             AMENDED PROPOSAL
 2.     The laws of the Member States may, however,             2.    The laws of the Member States may, however,
 provide that the general meeting may authorize                provide that the general meeting may authorize
 another organ of the company to alter the statutes,           another organ of the company to alter the
 provided:                                                     memorandum or articles of association, provided:
 (a) the alteration is effected only for the purpose of         (a) unchanged;
      giving effect to a resolution already passed by the
      general meeting;
      or
 (b) the alteration is imposed by an administrative            (b) the alteration is imposed by an administrative
      authority whose approval is necessary in order for            authority whose approval is necessary in order for
      alterations of the statutes to be valid;                      alterations of the memorandum or articles of
                                                                    association to be valid;
 (c) the alteration is effected solely in order that the       (c) the alteration is effected solely in order that the
      statutes comply with compulsory provisions of                 memorandum and articles of association comply
      law.                                                          with compulsory provisions of law.
                          Article 38                                                   Article 38
 The complete text of the statutes which is to be put          1.    The complete text of the alteration to the
 before the general meeting shall be set out in the            memorandum or articles of association which is to be
 notice of meeting.                                            put before the general meeting shall be set out in the
                                                               notice of meeting.
                                                               2.    The laws of the Member States may, however,
                                                               provide that if the general meeting is convened by
                                                               notice published pursuant to Article 24 (1) (b), the
                                                               text of the alteration referred to in paragraph 1 shall
                                                               be made available to shareholders at the latest from
                                                               the date of publication. Every shareholder shall be
                                                               able to obtain a copy of such text free of charge upon
                                                               request.
                         Article 39                                                    Article 39
1.     A majority of not less than two-thirds either of        1.    A majority of not less than two-thirds either of
votes carried by shares represented at the meeting or         votes carried by shares represented at the meeting or
of the capital subscribed which is represented thereat         of the subscribed capital which is represented thereat
shall be required for the passing by the general               shall be required for the passing by the general
meeting of resolutions altering the statutes.                  meeting of resolutions altering the memorandum or
                                                              articles of association.
 2.    Where, however, the laws of the Member States           2.      The laws of the Member States may, however,
provide that the general meeting may validly transact          provide that where at least half of the subscribed
business only if at least one-half of the capital sub-         capital is represented, the majority provided for in
 scribed is represented, resolutions for alteration of the     Article 36 (1) shall suffice.
 statutes shall require a majority not less than that
required under Article 36.
 3.     Resolutions of the general meeting which would         3.     Unchanged.
 have the effect of increasing the liabilities of the
 shareholders shall require in any event the approval
 of all shareholders involved.
                          Article 40                                                   Article 40
 1.    A resolution of the general meeting shall, where        1.    Where the share capital is divided into different
the share capital is divided into different classes and       classes, a resolution of the general meeting shall be
the resolution is detrimental to the holder of shares of      valid only if consented to by separate vote at least of
those classes, be valid only if consented to by separate      each class of shareholders whose rights are affected by
vote at least of each class.                                  the resolution in question.
2.     Article 39 shall apply.                                2.     Unchanged.
 ---pagebreak--- No C 240/30                            Official Journal of the European Communities                         9. 9. 83
                     ORIGINAL PROPOSAL                                           AMENDED PROPOSAL
                         Article 41                                                  Article 41
 1.    Minutes shall be prepared of every meeting of          Unchanged.
the general meeting.
2.     The minutes shall contain the following par-
ticulars at least:
(a) the place and date of the meeting;
(b) the resolutions passed;
(c) the result of the voting;
(d) objections made by shareholders to discussion of
     particular items of business.
3.     There shall be annexed to the minutes:
(a) the list of persons present;
(b) the documents relating to the calling of the
     general meeting.
4.    The minutes and the documents annexed thereto
shall be held at the disposal at least of the share-
holders and shall be kept for not less than three years.
                         Article 42                                                  Article 42
The Member States shall ensure that, without                   Unchanged.
prejudice to rights acquired in good faith by third
parties, all resolutions of the general meeting are void
or voidable where:
(a) the general meeting was not called in conformity           (a) to (f) unchanged;
    with Article 24 (1), (2) (b) and (d) and (3);
(b) the subject matter of the resolution was not
    communicated and published in conformity with
    Article 24 (2) (f) or Article 25 (3), but without
    prejudice to the provisions of Article 32 (2)
     or (3);
(c) contrary to Article 26, a shareholder was not
     allowed to attend the general meeting;
(d) contrary to Article 30, a shareholder was unable
    to examine a document or, contrary to Article 31,
     information was refused to him;
(e) in the course of transacting business, the
    provisions of Articles 33 and 34 relating to the
    exercise of the right of vote were not observed
    and as a result thereof the outcome of the vote
    was decisively affected;
(f) the majority required under Articles 36 or 39 was
    not obtained.
                                                              (g) contrary to Article 40 (1), the separate vote did
                                                                   not take place.
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                    ORIGINAL PROPOSAL                                            AMENDED PROPOSAL
                        Article 43                                                   Article 43
 Proceedings under Article 42 for nullity or voidability      Unchanged.
 may be brought at least:
 (a) in the case of Article 42 (a), by any shareholder        (a) to (f) unchanged;
      who was not present or represented at the general
      meeting;
 (b) in the case of Article 42 (b), by any shareholder
      unless he was present or represented at the
      general meeting but did not cause to be recorded
      in the minutes his objection that the business in
      question should not be discussed;
 (c) in the case of Article 42 (c), by any shareholder
     who was not allowed to attend the general
     meeting;
 (d) in the case of Article 42 (d), by any shareholder
     who was unable to examine any document or to
     whom information was refused;
(e) in the case of Article 42 (e), by any shareholder
     who was excluded from voting or who disputes
     the right to vote of some other shareholder who
     voted;
(f) in the case of Article 42 (f), by any shareholder.
                                                             (g) in the case of Article 42 (g), by any shareholder
                                                                  belonging to the class of shareholders whose rights
                                                                  were affected by the resolution of the general
                                                                  meeting.
                        Article 44                                                   Article 44
Proceedings for nullity or voidability shall be brought      Unchanged.
within a period which the Member States shall fix at
not less than three months nor more than one year
from the time when the resolution of the general
meeting could be adduced as against the person who
claims that the resolution is void or voidable.
                        Article 45                                                   Article 45
A resolution of the general meeting shall not be             A resolution of the general meeting shall not be
declared void where it has been replaced by another          declared void where it has been replaced by another
resolution passed in conformity with the law or the          resolution passed in conformity with the law or
statutes. The competent court must have power to             memorandum and articles of association. The
allow the company time to do this.                           competent court must have power to allow the
                                                             company time to do this.
                        Article 46                                                   Article 46
The question whether a decision of nullity pro-              1.     Any judgment declaring a resolution of the
nounced by a court of law in respect of a resolution         general meeting void shall be published in the manner
of the general meeting may be relied on as against           prescribed by the laws of each Member State in
third parties shall be governed by Article 12 (1) of         accordance with Article 3 of Directive 68/151/EEC.
Directive 68/151/EEC of 9 March 1968.
 ---pagebreak--- No C 240/32                             Official Journal of the European Communities                              9. 9. 83
                   ORIGINAL PROPOSAL                                                AMENDED PROPOSAL
                                                                2.    The question whether a judgment declaring a
                                                                resolution of the general meeting void may be relied
                                                                on as against third parties shall be decided in
                                                                accordance with Article 12 (1) of Directive 68/151/
                                                                EEC.
                        Article 47                                                      Article 47
Where the laws of the Member States provide for                 Where the laws of the Member States provide for
special meetings of holders of certain classes of               special meetings of holders of certain classes of
shares, the provisions of Chapter 3 shall apply to such         shares, the provisions of Chapter V shall apply
meetings and to the resolutions thereof.                        mutatis mutandis to such meetings and to the
                                                                resolutions thereof.
                      CHAPTER IV                                                      CHAPTER VI
    The adoption and audit of the annual accounts                   The adoption and audit of the annual accounts
                        Article 48                                                      Article 48
1.    The annual accounts within the meaning of                 1.    The annual accounts within the meaning of
Article 2 of Directive . . . of . . . shall be adopted by      Article 2 of Directive 78/660/EEC shall be adopted
the general meeting.                                            by the general meeting.
2.    The laws of the Member States may, however,               2.    The laws of the Member States may, however,
provide that the annual accounts shall be adopted not          provide that in companies organized according to the
by the general meeting but by the management organ              two-tier system, the annual accounts shall be adopted
and the supervisory organ, unless those two organs              not by the general meeting but by the management
decide otherwise or fail to agree.                              organ and the supervisory organ, unless those two
                                                               organs decide otherwise or do not reach agreement
                                                               on adoption of the annual accounts.
                        Article 49                                                      Article 49
1.    Five per cent of the result for each year, reduced        1.    Five per cent of any profit for the financial year,
where appropriate by losses brought forward from                reduced where appropriate by losses brought forward,
previous years, shall be appropriated to legal reserve          shall be appropriated to a legal reserve until that
until that reserve amounts to not less than 10 % of             reserve amounts to not less than 10 % of the sub-
the capital subscribed.                                         scribed capital.
2.    So long as the legal reserve does not exceed the          2.     So long as the legal reserve does not exceed the
amount specified in the foregoing paragraph, it shall           amount specified in the foregoing paragraph, it shall
not be used except to set off losses and then only if           not be used except to increase the subscribed capital
other reserves are inadequate for that purpose.                 or to set off losses and then only if other available
                                                                reserves are inadequate for those purposes.
                                                                3.    Pending subsequent coordination, the Member
                                                                States need not apply this Article to Investment
                                                                Companies with Variable Capital as defined in Article
                                                                 1 (2) of Directive 77/91/EEC.
                        Article 50                                                      Article 50
 1.   The general meeting shall decide how the result            1.    The general meeting shall decide how the profit
for each year, reduced where appropriate by the                  or loss for the financial year, increased where appro-
amount of the losses brought forward from previous              priate by profits brought forward and drawings from
years, are to be appropriated.                                  reserves available for that purpose, and reduced where
                                                                appropriate by losses brought forward and amounts
                                                                 taken to reserves in accordance with the law or the
                                                                memorandum or articles of association, is appro-
                                                                priated or treated.
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                        ORIGINAL PROPOSAL                                             AMENDED PROPOSAL
 2.    The statutes may, however, provide for the                  2.     The memorandum or articles of association
 appropriation of a maximum of 50 % of the result                  may, however, provide for the appropriation of a
 referred to in paragraph 1.                                       maximum of 50 % of any profit referred to in
                                                                  paragraph 1.
                            Article 51                                                   Article 51
 1.    One of more persons shall be made responsible              Deleted.
 for auditing the accounts of the company.
 2.    The audit shall in any event cover the annual
 accounts within the meaning of Article 2 of Council
 Directive . . . of . . . and the annual report within the
 meaning of Article 43 of that Directive.
                            Article 52                                                   Article 52
 Only persons who are independent of the company                  Deleted.
 and who are nominated or approved by a judicial or
 administrative authority may be charged with the
 responsibility of auditing the accounts of the
 company.
                            Article 53                                                   Article 53
 1.    The audit of the accounts shall in no case be              1.   The audit of the accounts shall in no case be
undertaken by persons who are members, or who                    undertaken by persons who are members, or who
during the last three years have been members, of the            during the last three years have been members, of the
management organ, supervisory organ or staff of the              administrative, management or supervisory organs, or
company whose accounts are to be audited.                        of the staff of the company whose accounts are to be
                                                                 audited.
 2.    Further, the audit of the accounts shall in no             2.   Further, the audit of the accounts shall in no
 case be undertaken by companies or firms whose                   case be undertaken by companies or firms whose
 members or partners, members of the management                   members or partners, members of the administrative,
 organ or supervisory organ, or of which the persons              mangement or supervisory organs, or of which the
 who have power of representation are members, or                 persons who have power of representation are
 during the last three years have been members, of the            members, or during the last three years have been
 management organ, supervisory organ or staff of the              members, of the administrative, management or
company whose accounts are to be audited.                         supervisory organ or staff of the company whose
                                                                  accounts are to be audited.
                            Article 54                                                   Article 54
 1.    The persons who have audited the accounts                 1.    The persons who have audited the accounts
shall in no case be or, for a period of three years              shall in no case become members of the
following cessation of their duties, become members              adminsitrative, management or supervisory organs or
of the management organ, supervisory organ or staff              of the staff of the company whose accounts have been
of the company whose accounts have been audited.                 audited less than three years after cessation of their
                                                                 duties.
2. «Further, the members or partners, members of                 2.       Further, the partners, members of the
the management organ or supervisory organ or the                 administrative, management or supervisory, organs, or
persons who have power of representation of the                  the persons having the power of representation of the
companies or firms who have audited the accounts                 companies or firms who have audited the accounts
shall in no case become members of the management                shall in no case become members of the
organ, supervisory organ or staff of the company                 administrative, management or supervisory organ or
whose accounts have been audited, less than three                of the staff of the company whose accounts have been
years after cessation of their duties.                           audited less than three years after cessation of their
                                                                 duties.
                           Article 55                                                   Article 55
1.    The persons who are to audit the accounts shall            1.    Unchanged.
be appointed by the general meeting. This Directive
 ---pagebreak--- No C 240/34                             Official Journal of the European Communities                              9.9.83
                      ORIGINAL PROPOSAL                                            AMENDED PROPOSAL
shall, however, be without prejudice to the provisions
of law of the Member States relating to the
appointment of such persons at the time of formation
of the company.
2.      Where appointment by the general meeting has            2.    Where appointment by the general meeting has
not been made in due time or where any of the                   not been made in due time or where any of the
persons appointed is unable to carry out his duties,            persons appointed is unable to carry out his duties,
the management organ, the supervisory organ or any              the administrative, management or supervisory organ
shareholder must have the right to apply to the court           or any shareholder must have the right to apply to a
for appointment of one or more persons to audit the             judicial or administrative authority for appointment of
accounts.                                                       one or more persons to audit the accounts.
3.      Further, the court must have power to dismiss,          3.    Further, the judicial or administrative authority
where there are proper grounds, any person                      must have power to dismiss, where there are proper
appointed by the general meeting to audit the                   grounds, any person appointed by the general
accounts, and must also have power to appoint some              meeting to audit the accounts, and must also have
other person for that purpose if application is made            power to appoint some other person for that purpose
by the management organ, supervisory organ or by                if application is made by the administrative,
one or more shareholders who satisfy the                        management or supervisory organ or by one or more
requirements of Article 16.                                     shareholders who satisfy the requirements of Article
Such application shall be made within two weeks                  16 (1). Such application shall be made within two
following the date of the appointment by the general            weeks of the appointment by the general meeting.
meeting.
                           Article 56                                                   Article 56
The persons who audit the accounts shall be                     The persons who audit the accounts shall be
appointed for a period certain of not less than three           appointed for a specified period of not less than three
years nor more than six years. They shall be eligible           years nor more than six years. They shall be eligible
for reappointment.                                              for reappointment.
                           Article 57                                                   Article 57
1.      The remuneration of the persons appointed by            1.    The remuneration, or its method of calculation,
the general meeting to audit the accounts shall be              of the persons responsible for auditing the accounts
fixed for the whole of their period of office before it         shall be fixed for the whole of their period of office
commences.                                                      before it commences, taking account of the nature
                                                                and importance of the duties to be carried out.
2.      Apart from the remuneration fixed pursuant to           2.    Unchanged.
paragraph 1, no remuneration or benefit shall be
accorded to the persons in question in respect of their
auditing of the accounts.
3.      The provisions of paragraph 2 shall apply to the        3.    Deleted.
persons appointed by the court to audit the accounts.
                           Article 58                                                   Article 58
1.      The persons appointed to audit the accounts             1.    The persons responsible for auditing the
shall in all cases examine whether the annual accounts          accounts shall in all cases examine whether the annual
within the meaning of Article 2 of Directive . . . of           accounts within the meaning of Article 2 of Directive
. . . (*) and the annual report within the meaning of           78/660/EEC give a true and fair view of the
Article 43 of that Directive are in conformity with the         company's assets, liabilities, financial position and
law and the statutes.                                           profit or loss. They shall also verify the consistency of
                                                                the annual report within the meaning of Article 46 of
                                                                the above Directive with the annual accounts for the
                                                                same financial year.
(') O J N o C 7 , 28. 1. 1972.
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                    ORIGINAL PROPOSAL                                             AMENDED PROPOSAL
2.     If they have no reservation to make, the persons       2.     If they have no reservation to make, the persons
responsible for the audit shall so certify on the annual      responsible for the audit shall deliver an opinion on
accounts; otherwise they shall issue their certificate        the annual accounts that the requirements imposed in
subject to reservations or shall refuse their certificate.    paragraph 1 have been met; otherwise they shall issue
                                                              their opinion subject to reservations or shall withold
                                                              their opinion.
                         Article 59                                                   Article 59
The persons responsible for auditing the accounts             Unchanged.
shall be entitled to obtain from the company all infor-
mation and relevant documents and to undertake all
such investigations as may be necessary.
                        Article 60                                                    Article 60
The persons responsible for auditing the accounts             The persons responsible for auditing the accounts
shall prepare a detailed report relating to the results       shall prepare a detailed report relating to the results
of their work. The report shall contain the following         of their work. The report shall contain the following
at least:                                                     at least:
(a) an indication of whether the provisions of Article        (a) deleted;
     58 (1) have been observed;
(b) observations concerning any infringements of law         (b) observations concerning any infringements of law
     or of the statutes which have been found in the               or of the memorandum or articles of association
     company's accounts, in its annual accounts or in              which have been found in the company's
     the management report;                                        accounts, annual accounts or annual report in the
                                                                   course of the audit;
(c) observations concerning any facts noted which             (c) observations concerning any facts noted in the
    constitute a serious danger to the financial                   course of the audit which constitute a serious
    situation of the company;                                      danger to the financial position of the company;
(d) the complete text of the certificate given pursuant       (d) the complete text of the opinion delivered
    to Article 58 (2). Where reservations have been                pursuant to Article 58 (2). Where reservations
    withheld, the reasons therefor shall be specified.             have been made or where the opinion has been
                                                                   withheld, the reasons therefor shall be specified.
                        Article 61                                                    Article 61
Save where proper grounds exist, the persons                 Unchanged.
responsible for auditing the accounts shall not be
dismissed by the general meeting before the end of
their period of office.
                        Article 62                                                    Article 62
Articles 14 to 21 of this Directive shall apply in            Articles 14 to 19 and 21 shall apply in respect of the
respect of the civil liability of the persons responsible     civil liability of the persons responsible for auditing
for auditing the accounts, so as to ensure that               the accounts, so as to ensure that compensation is
compensation is made for any damage sustained by              made for any damage sustained by the company as a
the company, any shareholder or third party as a              result of wrongful acts committed by the aforesaid
result of wrongful acts committed by those persons            persons in carrying out their duties.
aforesaid in carrying out their duties.
                        Article 63                                                    Article 63
1.    The Member States shall       ensure that, without            Unchanged.
prejudice to rights acquired in      good faith by third
parties, all resolutions of          the organ whose
responsibility it is to adopt the    annual accounts are
void or voidable where:
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                    ORIGINAL PROPOSAL                                         AMENDED PROPOSAL
(a) the annual accounts have not been audited in          (a) unchanged;
    conformity with Article 58 (1);
(b) the certificate relating to the annual accounts has   (b) the opinion relating to the annual accounts has
    been refused in accordance with Article 58 (2);            been withheld in accordance with Article 58 (2);
(c) the annual accounts have not been audited by a        (c) to (e) unchanged.
    person nominated or approved in manner
    required by Article 52;
(d) the annual accounts have been audited by a
    person who, under Article 53, should not have
    been made responsible for the audit, or who has
    been dismissed by the court in conformity with
    Article 55 (3) or by the general meeting in
    conformity with Article 61;
(e) the annual accounts have been audited by a
    person who, contrary to Article 55 (1), was not
    appointed by the general meeting or who,
    contrary to Article 55 (2) or (3), was not
    appointed by the court.
2.    Proceedings for nullity or voidability may be       2.     Unchanged.
brought at least by any shareholder.
3.    Articles 44 to 46 shall apply.                      3.     Unchanged.
                      CHAPTER V                                                 CHAPTER VII
                   General provisions                                         General provisions
                                                                                  Article 63a
                                                          1.     For the purposes of this Directive, the ECU shall
                                                          be that defined by Regulation (EEC) No 3180/78 (').
                                                          The equivalent in national currency shall be calculated
                                                          initially at the rate obtaining on the date of adoption
                                                          of this Directive.
                                                          2.     Every five years the Council, acting on a
                                                          proposal from the Commission, shall examine and, if
                                                          need be, revise the amounts expressed in ECU in this
                                                          Directive, in the light of economic and monetary
                                                          trends in the Community.
                                                                                 Article 63b
                                                          1.     Pending subsequent coordination where the
                                                          company is the parent undertaking of a group, the
                                                          Member States:
                                                          (a) may derogate from Articles 4 and 21b in so far as
                                                               may be necessary to permit the employees of sub-
                                                               sidiary undertakings of that group to be included
                                                               in the system of participation or representation of
                                                               employees applicable to that parent undertaking in
                                                               accordance with this Directive:
                                                          (') OJ No L 379, 30. 12. 1978, p. 1.
 ---pagebreak--- 9. 9. 83            Official Journal of the European Communities                              No C 240/37
         ORIGINAL PROPOSAL                                            AMENDED PROPOSAL
                                                 (b) need not apply Articles 10a (2) first sentence and
                                                     21q (2), first sentence, in respect of decisions
                                                     concerning a subsidiary undertaking of that
                                                     group.
                                                 la.    Pending subsequent coordination, the Member
                                                 States may derogate from Articles 4 to 4i and 21b to
                                                 21i where the company is:
                                                 (a) a financial holding company as defined in Article
                                                     5 (3) of Directive 78/660/EEC or
                                                 (b) the parent undertaking of an international group
                                                     and its sole object is the coordination of the
                                                     management and financing of subsidiary under-
                                                     takings.
                                                 2.    Pending subsequent coordination, where the
                                                 company is a subsidiary undertaking of a group, the
                                                 Member States:
                                                 (a) need not apply Articles 4 and 21b provided that
                                                     the employees of that subsidiary undertaking
                                                     are included in the system of participation or
                                                     representation of employees applicable to the
                                                     parent undertaking of that group in accordance
                                                     with this Directive;
                                                 (b) may, provided that the employees' participation or
                                                     representation rights are guaranteed in accordance
                                                     with subparagraph (a), derogate from Articles 12,
                                                     14 and 21s in so far as may be necessary to allow
                                                     that subsidiary undertaking to be managed in
                                                     accordance with group strategy, and on condition
                                                     that the parent undertaking assumes responsibility
                                                     for the liabilities of the subsidiary undertaking
                                                     towards third parties and as regards Article 14 for
                                                     the liabilities to which that Article refers.
                                                 (c) may derogate from Articles 3 (1) (b) and 13 (1)
                                                     where the members or the supervisory organ of
                                                     the subsidiary undertaking are appointed in
                                                     accordance with Article 4c.
                                                                         Article 63c
                                                  1.   Not more than five years after the expiry of the
                                                 period referred to in Article 64 (2), the Commission
                                                 shall submit a report to the Council and Parliament
                                                 on the experience of Member States as regards the
                                                 application of this Directive and in particular Articles
                                                 2 to 4i, 11, 12 and 21b to 21s thereof.
                                                 In that report the Commission shall devote particular
                                                 attention to the view communicated to it regarding
                                                 the application of those Articles by the organizations
                                                 of employers and employees involved in their
                                                 application.
                                                 2.    The Commission shall        include, where appro-
                                                 priate, in the report referred   to in paragraph 1, more
                                                 detailed proposals concerning    the matters governed by
                                                 this Directive in general and    by the Articles referred
                                                 to in paragraph 1.
 ---pagebreak--- No C 240/38                          Official Journal of the European Communities                              9.9.83
                   ORIGINAL PROPOSAL                                               AMENDED PROPOSAL
                                                                                       Article 63d
                                                             The Member States may derogate from Articles 4 to
                                                             4i and 21b to 21i with respect to companies whose
                                                             sole or principal object is:
                                                             (a) political, religious, humanitarian,        charitable,
                                                                    educational, scientific or artistic; or
                                                             (b) related to public information or expression of
                                                                    opinion.
                                                             Such special provision must be limited to that which is
                                                             necessary to ensure that such undertakings enjoy the
                                                             freedom to which they are entitled under the national
                                                             laws to which they are subject.
                       Article 64                                                      Article 64
1.    The Member States shall bring into force within        1.      The Member States shall bring into force before
18 months following the notification of this Directive       . . . the laws, regulations and administrative provisions
all such amendments to their laws, regulations or            necessary to comply with this Directive. They shall
administrative provisions as may be necessary to             immediately inform the Commission thereof.
comply with the provisions of this Directive and shall
inform the Commission thereof.
2.    The Member States may provide that the                  2.     The Member States may provide that the laws,
amendments to their laws as referred to in paragraph          regulations and administrative provisions referred to
1 shall not apply to companies already in existence at        in paragraph 1 shall not apply to companies already
the time of entry into force of those amendments              in existence at the time of entry into force thereof
until 18 months after that time.                              until the end of a period of 18 months after the date
                                                              referred to in paragraph 1. The period of 18 months
                                                              may, however, be four years in respect of the
                                                              application of Article 2 (1).
3.    The Member States shall communicate to the              3.      Unchanged.
Commission, for information, the texts of the draft
laws and regulations, together with the grounds
therefor, relating to the field governed by this
Directive. The texts shall be communicated not later
than six months before the proposed date of entry
into force of the drafts.
                        Article 65                                                      Article 65
This Directive is addressed to the Member States.             Unchanged.