Company law (debate)
The next item is the Commission statement on company law.
Member of the Commission. - Mr President, the European private company statute has regularly been on the agenda of the European Parliament and also, as you know, on that of its Committee on Legal Affairs. Various arguments presented during these debates have demonstrated that a statute for European private companies may bring benefits to small and medium-sized companies, and there has also been support for the idea of a stakeholder consultation.
The Commission recognises that the regulatory framework needs to be adapted to allow SMEs to make the most of increasingly integrated European markets. We need to make it easier and cheaper for small and medium-sized companies to conduct cross-border business. It is important to take action that will help those firms to fully reap the benefits of the single market.
The growth of small and medium-sized businesses is crucial, as we all know, for the competitiveness of the European economy, and the Commission can see that a European private company statute could facilitate the expansion of small businesses beyond national borders. Therefore, by providing an option, it would create more choice for companies, without imposing any additional burdens.
It could well reduce the compliance costs for firms that wish to operate in several Member States. If this can be achieved, SMEs could have easier access to new markets. The Commission is therefore aware of the importance of the European private company statute to the Member States of the European Union and to European businesses.
I can assure you that my colleague, Commissioner McCreevy, will proceed with a legislative proposal for a European private company statute, as he declared to the Legal Affairs Committee on 3 October 2007. This proposal should be ready by mid-2008 at the latest. As you know, we are currently conducting further consultations on the exact form and content of the proposal, the results of which will then be incorporated into the impact assessment to be completed in the first months of next year. My colleague Mr McCreevy will be very happy to have a continued dialogue with you once this proposal is on the table.
on behalf of the PPE-DE Group. - (DE) Mr President, Commissioner, let me begin by thanking you sincerely for your remarks, which bring me neatly to my first point, namely the European private-company statute. I may say we are delighted that, after protracted difficulties, the Commission has finally been convinced of the need for this legislative draft, and that we can now expect to receive it. It is to the credit of Parliament that this was made possible by the heavy pressure we exerted. Be that as it may, we can only rejoice wholeheartedly at the outcome.
I do, however, intend to address a second point to which today's resolution also refers, and on which we are not satisfied with the way things have developed. I refer here to the 14th Company Law Directive on the transfer of the company's registered office, the place where companies are registered. For many years the European Commission has had plans to close this loophole in company law. We have now learned that this has been more or less deleted from the legislative programme, at least as far as the European Commission is concerned, and that the loophole will therefore remain open.
May I emphasise at this point that my political group at least - and, I believe, an overwhelming majority of the Legal Affairs Committee, to judge by the tenor of its deliberations in recent years, and of this House as a whole - has always taken the view that this loophole needs to be closed and that the 14th Company Law Directive is a necessity.
This is not a matter of additional bureaucracy and new corporate obligations. It is simply about giving companies the opportunity promised them in the Treaty to move freely within the European Union and establish themselves in any Member State. We have heard that one of the reasons why the European Commission felt unable to move forward on this issue and to present a proposal was its view that the existing merger regulations and other provisions were adequate to guarantee corporate mobility.
I can only say that, if a company cannot move its registered office within the single market unless it founds a new company in another country and then merges with it, the present rules are scarcely exemplary as a means of avoiding red tape or minimising costs. The ideal would be a sound piece of secondary legislation that guaranteed the right of companies to exercise in practice the freedom that the single market offers them in theory.
One of the arguments advanced for the status quo is that past rulings of the European Court of Justice have greatly liberalised company law in any case. That is undoubtedly true, but the European Court delivers these rulings for the sole purpose of promoting the full application of primary law, simply because the legislative bodies responsible for the adoption of secondary law, namely Parliament and the Council - though we depend on the European Commission - are not able to enact sound secondary legislation that would actually guarantee the freedoms enshrined in the Treaty provisions establishing the single market.
That is why Parliament is adhering to its position that the Commission's monopoly on the right of initiative binds it to present a proposal for a 14th Company Law Directive in due course. We ask the Commission to reconsider whether the 14th Directive, which is already on file in the Commission's offices, can be incorporated into the legislative programme in the coming years.
If that does not happen, Parliament reserves the right - as our resolution expressly states - to invoke Article 192 of the Treaty and table a report on its own initiative with a view to requesting a legislative proposal. And while we are on the subject of company law, let me take this convenient opportunity to say a brief word about the Commission's latest communication on the simplification of company law. The resolution does not deal directly with that communication, but there is a thematic connection between the two.
I believe we in Parliament agree that we do not support any erosion of the substance of established Community law and practice - the acquis communautaire - as a consequence of simplification measures. In other words, there can be no question, in my view, of deleting entire directives. What we can support are measures designed to unburden companies, to minimise bureaucratic and statistical obligations, to relieve companies of the requirement to publish all the bits and pieces which appear in their balance sheets but which may actually be quite unimportant. I believe there is scope here to cooperate closely with the Commission in order to improve company law.
One other thing that struck me when I read the Commission's documentation on this subject was that there are certain laws we have enacted - one example being the Transparency Directive, adopted in the wake of the Sarbanes-Oxley Act - which contain some provisions that now beg the question of why they are not being reviewed as part of a simplification drive. I should also welcome further consideration of this matter by the Commission, since such a review would likewise help to improve company law.
on behalf of the PSE. - (ES) Mr President, Mr Lehne has in essence given the view held by the members of the Committee on Legal Affairs. He has done so on behalf of the European People's Party Group, and I shall do so on behalf of the Party of European Socialists.
Our concern at present is, as Mr Lehne has said, that we are relying too heavily on judicial development of the law, in other words, on development through the case-law of the Court of Justice. The case-law of the Court of Justice fills in the gaps left by the secondary law of the European Union, but we do not have secondary law. The Treaties are very general in nature and provide for certain fields and give rise to various interpretations and do not at present facilitate the establishment of the internal market.
Our proposals are bi-directional, as Mr Lehne has pointed out, firstly they support the offer made by the Commission to submit a proposal for a directive on the European private company which would clearly do a great deal to help establish free movement within the European Union, and secondly to try to continue pushing in the field of company law by pressing for a new directive, the fourteenth, which could ultimately supplement those provisions.
I share Mr Lehne's concern that, if we do not adopt provisions on the transfer of company head offices, then we would in fact be leaving a legal loophole open because mergers are a different matter and do not fall fully into this category. We hope the Commission can include this type of activities in its work programme.
First, I hope that during 2008 and, if possible, before 30 June, the proposal for a directive, the Directive on the European private company statute, will be on the table, and, secondly, it is to be hoped that the Commission does not give up on the idea of continuing to develop company law in fields such as freedom of establishment and change of domicile for companies.
That is the end of my speech.
Member of the Commission. - Mr President, let me answer both questions.
In answer to the first, I think it is clear. In answer to the second, concerning the 14th company law directive, we had suggested that a further means of improving mobility might be a directive stipulating the conditions for the transfer of registered offices in the European Union. The results of the economic analysis of the possible added value of a directive were inconclusive; companies already have the legal means to effect cross-border transfer. Several companies have already transferred their registered office using the possibilities offered by the European Company Statute.
Soon, the Cross-Border Mergers Directive, which will enter into force in December, will give all limited liability companies, including SMEs, the option to transfer their registered office. They could do so by setting up a subsidiary in the Member State to which they want to move and then merging the existing company into this subsidiary.
In the Commission's view, it is only if this framework is found wanting that future legislative action in the shape of a 14th company law directive can be justified. Therefore, Mr McCreevy has decided for the moment not to proceed with this 14th company law directive, but I will certainly communicate your concerns again.
I have received a motion for a resolution in accordance with Rule 103(2) of the Rules of Procedure.
The debate is closed.
The vote will take place shortly, during voting time.