scholarly journals The Illusion of Motion: Corporate (Im)Mobility and the Failed Promise of Centros

2019 ◽  
Vol 20 (3) ◽  
pp. 425-465 ◽  
Author(s):  
Carsten Gerner-Beuerle ◽  
Federico Mucciarelli ◽  
Edmund Schuster ◽  
Mathias Siems
Keyword(s):  
Economic Incentives ◽  
Capital Requirements ◽  
Company Law ◽  
The Body ◽  
Regulatory Competition ◽  
Corporate Structure ◽  
Regulatory Arbitrage ◽  
Minimum Capital ◽  
European Court ◽  
Real Seat

Abstract The European Court of Justice’s landmark decision in Centros was heralded as creating the preconditions for a vibrant market for incorporations in the EU. In practice, however, today’s corporate landscape in Europe differs little from that of the late 1990s. Very few large companies have made use of their ability to subject themselves to the company law of a Member State in which they are not also headquartered, and there are few signs suggesting that a ‘European Delaware’ will emerge in the near future. To the extent that Member States have engaged in competitive law-making, this has largely been confined to minimum capital requirements and rules affecting the ease of the incorporation process—areas concerning primarily micro-companies. We argue that the modest effect of Centros is not only a function of limited economic incentives to engage in regulatory competition and regulatory arbitrage, but also of the fact that the applicability of large sections of relevant laws governing corporate behaviour is determined by real seat-like connecting factors which render regulatory arbitrage more difficult. We analyse the boundaries between the lex societatis and neighbouring legal areas, notably insolvency and tort law, and find that the body of rules regulating a company’s outward-facing activities, as opposed to its internal affairs, is largely removed from regulatory arbitrage. It therefore seems likely that the potential benefits of selecting the applicable company law, while remaining subject to a cocktail of other, equally relevant rules, are sufficiently small to be regularly outweighed by the costs of a complex and non-standard corporate structure that is necessary to exercise free movement rights.

Two Types of Regulatory Competition: Competitive Federalism Versus Reflexive Harmonisation. A Law and Economics Perspective on Centros

1999 ◽  
Vol 2 ◽  
pp. 231-260 ◽  
Author(s):  
Simon Deakin
Keyword(s):  
Law And Economics ◽  
Capital Requirements ◽  
Company Law ◽  
Regulatory Competition ◽  
The European Union ◽  
Legal Rules ◽  
Minimum Capital ◽  
The Uk ◽  
The Right ◽  
Competitive Federalism

There is a growing debate about the desirability of allowing greater scope for regulatory competition inside the European Union. The argument for doing so is that competition between the Member States in the production of legal rules will lead to greater economic efficiency than can be achieved through the harmonisation of standards. The Court’s ruling in Centros appears to mark a significant move in the direction of inter-state competition in company law. In deciding that a company founded by Danish citizens in the UK, thereby avoiding Danish minimum capital requirements, could not be denied the right to register an overseas branch in Denmark for the purposes of trading there, the Court has rekindled a long-running debate about the siège réel doctrine.

Two Types of Regulatory Competition: Competitive Federalism Versus Reflexive Harmonisation. A Law and Economics Perspective on Centros

1999 ◽  
Vol 2 ◽  
pp. 231-260 ◽  
Author(s):  
Simon Deakin
Keyword(s):  
Law And Economics ◽  
Capital Requirements ◽  
Company Law ◽  
Regulatory Competition ◽  
The European Union ◽  
Legal Rules ◽  
Minimum Capital ◽  
The Uk ◽  
The Right ◽  
Competitive Federalism

There is a growing debate about the desirability of allowing greater scope for regulatory competition inside the European Union. The argument for doing so is that competition between the Member States in the production of legal rules will lead to greater economic efficiency than can be achieved through the harmonisation of standards. The Court’s ruling inCentrosappears to mark a significant move in the direction of inter-state competition in company law. In deciding that a company founded by Danish citizens in the UK, thereby avoiding Danish minimum capital requirements, could not be denied the right to register an overseas branch in Denmark for the purposes of trading there, the Court has rekindled a long-running debate about thesiège réeldoctrine.

The End of the Real Seat Theory (Sitztheorie): the European Court of Justice Decision inUeberseeringof 5 November 2002 and its Impact on German and European Company Law

2002 ◽  
Vol 3 (12) ◽  
Author(s):  
Kilian Baelz ◽  
Teresa Baldwin
Keyword(s):  
Member State ◽  
Central Place ◽  
Company Law ◽  
European Court Of Justice ◽  
Legal Capacity ◽  
Freedom Of Establishment ◽  
Court Of Justice ◽  
European Court ◽  
Real Seat ◽  
A Company

In a long awaited judgement delivered on 5 November 2002, the European Court of Justice (ECJ) has ruled that it isincompatiblewith the freedom of establishment guaranteed in Arts. 43 and 48 EC for a member state to deny a company formed in a member state which moves its central place of administration to another member states, legal capacity (and standing to sue or be sued in courts). Against the expectations of many German legal commentators and the recommendation of the Advocate General, the ECJ also held that where a company incorporated in another member state exercises its freedom of establishment in another member state, that other member state isrequired to recognisethe company's legal capacity (and capacity to be a party to legal proceedings) which it enjoys under the laws of its state of incorporation.

scholarly journals Minimum Authorized Capital After the Enactment of Job Creation Law: Status Quo, Controversies, and Road Ahead

Lentera Hukum ◽  
2021 ◽  
Vol 8 (1) ◽  
pp. 1
Author(s):  
Kania Jennifer Wiryadi ◽  
Bayu Novendra
Keyword(s):  
Job Creation ◽  
Limited Liability ◽  
Capital Requirements ◽  
Company Law ◽  
Limited Liability Company ◽  
Minimum Capital ◽  
Business Units ◽  
Minimum Capital Requirement ◽  
Limited Company ◽  
Authorized Capital

In a limited liability company, capital becomes one of the primary elements. However, the regulation regarding capital in Indonesia has changed several times, as its latest concern on the enactment of the omnibus bill on Job Creation Law in 2020. This paper discussed the following problems. First, what are the status quo and the development of regulations regarding minimum capital requirements in Indonesia? Second, what are the pros and cons of minimum capital requirement regulations and their developments in other countries? Third, what is the minimum capital requirements regulation that suits the conditions in Indonesia? This paper used legal research, emphasizing literature study. In so doing, the data were analyzed with the deductive method to construct conclusions. This paper showed that each limited liability company from the 1995 Limited Company Law, the 2007 Limited Company Law to the Job Creation Law had various minimum capital requirements provisions that lasted to its abolishment under the Job Creation Law. In this context, the initial policy on the minimum capital requirement was to protect creditors. In practice, however, this policy was not effective because of many other effective alternatives to protect creditors, by encouraging transparency in corporate transactions and offering easy access to corporate information. The dominance of micro and small business units in Indonesia (99% of business units) explained the urgency of eliminating minimum capital requirements regulations. The elimination of minimum authorized capital requirements was a tremendous effort to strengthen micro and small enterprises. KEYWORDS: Limited Liability Company, Job Creation Law, Company Law.

Basel Capital Adequacy Ratio Standard in The Light of Islamic Law Perspective

2016 ◽  
Vol 1 ◽  
pp. 308-317
Author(s):  
Adi Rahmanur Ibnu
Keyword(s):  
Financial Crises ◽  
Global Economy ◽  
Banking Sector ◽  
Islamic Law ◽  
Capital Requirements ◽  
Capital Adequacy ◽  
Minimum Capital ◽  
Capital Adequacy Ratio ◽  
Global Banking ◽  
Banking Development

Bank is one of the most important pillars of economy activities. However, banking sector has a real potential crisis threat. Alongside with the steady current global banking development, financial crises that have happened clearly affected global economy. Based on that situation, BIS (Bank for International Settlement) – an international financial standard setting organization, realizes the urgency to establishan international financial standard and supervision to anticipate future potential financial crises. This research aims to identify how Capital Adequacy Ratio Standard in Basel Capital Accord (II) based on Islamic law perspective. The research is conducted by analyzing Basel Capital Accord published by BIS. The research uses library research method to find out the aimed result. The focus is on the 1st pillar of Basel II publication that is Minimum Capital Requirements (CAR) policy. CAR, as an Islamic economics policy, will be analyzed using falāḥ approach. Falāḥ is an Islamic economics objective that consists of happiness, success, accomplishment or good luck concept. The earthly dimension of falāḥ has some parameters that can be used to analyze Islamic economics policy. Additionally, the Islamic fiqh maxim takes part in analyzing the policy. The maṣlaḥat concept in fiqh maxim approach shares aim with falāḥ concept in the sense that all of sharia law aims for success, happiness, eternal survival etc. The maṣlaḥat can be accomplished by extinguishing mafsadat or seizing maṣlaḥat. The maṣlaḥat aspect is essential to determine the compatibility Basel Capital Accord with jurisprudential maxim i.e harm must be dispelled (al-dharāru yuzāl). The conclusion results are, 1) Basel Capital Accord focuses on macro-prudential aspect in order to anticipate potential financial crises, 2) beneficial/interest (maṣlaḥat) aspects of the hereafter, cooperation principle, justice, fairness and the prohibition of exploitation are not the core value of Basel Capital Accord frame work, thus 3) the achievement of maslahat as intended by sharia i.e. jurisprudential maxim are not convincing. Therefore, 4) Basel Capital Accord as a regulation basis is not in line with jurisprudential maxim i.e harm must be dispelled (al-dharāru yuzāl).

Islamic Banking Regulations in Light of Basel II

2010 ◽  
Vol 27 (1) ◽  
pp. 74-101 ◽  
Author(s):  
M. Kabir Hassan ◽  
Muhammad Abdul Mannan Chowdhury
Keyword(s):  
Financial Institutions ◽  
Banking Regulation ◽  
Capital Requirements ◽  
Basel Ii ◽  
Capital Adequacy ◽  
Regulatory Agencies ◽  
Islamic Banking ◽  
Islamic Banks ◽  
Minimum Capital ◽  
Regulatory Standards

This paper seeks to determine whether the existing regulatory standards and supervisory framework are adequate to ensure the viability, strength, and continued expansion of Islamic financial institutions. The reemergence of Islamic banking and the attention given to it by regulators around the globe as to the implications of a recently issued Basel II banking regulation makes this article timely. The Basel II framework, which is based on minimum capital requirements, a supervisory review process, and the effective use of market discipline, aligns capital adequacy with banking risks and provides an incentive for financial institutions to enhance risk management and their system of internal controls. Like conventional banks, Islamic banks operate under different regulatory regimes. The still diverse views held by the regulatory agencies of different countries on Islamic banking and finance operations make it harder to assess the overall performance of international Islamic banks. In light of the increased financial innovation and diversity of instruments offered in Islamic finance, the need to improve the transparency of bank operations is particularly relevant for Islamic banks. While product diversity is important in maintaining their competitiveness, it also requires increased transparency and disclosure to improve the understanding of markets and regulatory agencies. The governance of Islamic banks is made even more complex by the need for these banks to meet a set of ethical and financial standards defined by the Shari`ah and the nature of the financial contracts banks use to mobilize deposits. Effective transparency in this area will greatly enhance their credibility and reinforce their depositors and investors’ level of confidence.

Company Law

2021 ◽  
Author(s):  
Brenda Hannigan
Keyword(s):  
Decision Making ◽  
Corporate Governance ◽  
Corporate Finance ◽  
Company Law ◽  
Corporate Structure ◽  
Legal Personality ◽  
Corporate Entity ◽  
The Subject ◽  
Corporate Insolvency

Company Law brings clarity and analysis to the ever-changing landscape of this field. The text aims to capture the dynamism of the subject, places the material in context, highlights its relevance and topicality, and guides readers through all the major issues. From incorporation through to liquidation and dissolution, the work explores the workings of the corporate entity. The book is divided into five distinct sections covering corporate structure (including legal personality and constitutional issues), corporate governance (including directors’ duties and liabilities), shareholders’ rights and remedies (including powers of decision-making and shareholder petitions), corporate finance (including share and loan capital), and corporate insolvency.

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