The reform of the Transparency Directive is presently on the political agenda, with one of the key questions focusing on the level of harmonisation: should the current minimum harmonisation be retained or is a move towards full harmonisation advisable? After confirming legal competence for the full harmonisation of European capital markets law, this article weighs the pros and cons of full harmonisation in the case of ownership disclosure rules. The ability to overcome the costly legal fragmentation of the current regulatory regime for notification of major shareholdings throughout Europe is revealed as the greatest benefit of full harmonisation. As full harmonisation not only reduces compliance costs but also boosts investor confidence, all market participants stand to benefit. Despite this, full harmonisation also carries certain costs as it inhibits regulatory competition, increases complexity in implementing EU law in national legal systems and carries the danger of a petrification effect. The article reveals that these cost factors are not sufficient to undermine the case for full harmonisation for financial instruments requiring notification, as well as for thresholds, timeframes and notification formats. It goes on to show that legal regimes can retain their adaptive efficiency by allowing them to conduct temporary legislative experiments. However, the article refrains from generalising this finding, encouraging a targeted full harmonisation approach for the Transparency Directive.

Research in corporate governance and labour law has been characterised by a disjuncture in the way that scholars in each field are addressing organisational questions related to the business enterprise. While labour has eventually begun to shift perspectives from aspirations to direct employee involvement in firm management, as has been the case in Germany, to a combination of ‘exit’ and ‘voice’ strategies involving pension fund management and securities litigation, it remains to be seen whether this new stream will unfold as a viable challenge to an otherwise exclusionary shareholder value paradigm. At the same time, recent suggestions made by Vice Chancellor Strine of the Delaware Chancery Court to dare think about potentially shared commitments between management and labour underline the viability of attempts at moving the corporate governance debate beyond the confines of corporate law proper.

This paper takes the questionable divide between management and labour within the framework of a limiting corporate governance concept as a starting point to explore the institutional dynamics of the corporation, thereby building on the theory of the innovative enterprise as developed by management theorists Mary O'Sullivan and William Lazonick. Largely due to the sustained distance between corporate and labour law scholars, neither group has effectively addressed their common blind spot: a better understanding of the business enterprise itself. In the midst of an unceasing flow of affirmations of the finance paradigm of the corporation, on the one hand, and ‘voice’ strategies by labour, on the other, it seems to fall to management theorists to draw lessons from the continuing coexistence of different forms of market organisation, in which companies appear to thrive. Exploring the conundrum of ‘risky’ business decisions within the firm, management theorists have been arguing for the need to adopt a more sophisticated organisational perspective on companies operating on locally, regionally and transnationally shaped, and often highly volatile, market segments. Research by comparative political economists has revealed a high degree of connectivity between corporate governance and economic performance without, however, arriving at such favourable results only for shareholder value regimes. Such findings support the view that corporate governance regimes are embedded in differently shaped regulatory frameworks, characterised by distinct institutions, both formal and informal, and enforcement processes. As a result of these findings, arguments to disassociate issues of corporate governance from those of the firm's (social) responsibility (CSR) have been losing ground. Instead, CSR can be taken to be an essential part of understanding a particular business enterprise. It is the merging of a comparative political economy perspective on the corporation with one on the organisational features, structures and processes of the corporation that can help us better understand the distribution of power and knowledge within the ‘learning firm’.

As in other European Union countries, Spanish local governments, by law and according to their population size, provide a number of basic services, which include the local police service, fire-fighting, refuse collection, street cleaning, land use control, urban transportation, social services, leisure and cultural activities, public works and town planning, slaughterhouses, central markets, housing, etc. Only the larger Spanish municipalities participate in the delivery of services such as education or health, which are under regional government responsibility. The vast majority of Spanish municipalities are very small. Recently, some Autonomous Communities have been establishing supra-municipal or district authorities (Comarcas), grouping several municipalities in order to manage the delivery of common local services. Public-private partnership initiatives were introduced into Spain by the Municipal Services Act of 1955, which allows the provision of local services by private operators. This act was updated by the Public Contracting Act of 1995, which was recently amended to bring it into line with EU legislation. Spanish local governments have traditionally provided services using almost all PPP methods, such as local government corporations, concessions or franchises, lease of assets with or without additional investment, public-private ventures, associations with other local governments, public entities and non-profit organisations. The results of our work on local service provision, set out in this paper, show a higher degree of PPP initiatives in medium-sized Spanish cities than in the rest. We find no statistical differences in the levels of efficiency observed in public and private urban transport operators. Finally, we observe both a need to update car park concessions in Spanish local administrations, incorporating mechanisms to increase efficiency, and an absence of homogeneity in these concessions because there is no unit that advises public authorities.

This paper seeks to provide an analysis of Commission v. Netherlands, a judgment handed down by the First Chamber of the European Court of Justice (hereinafter, ECJ) on 28 September 2006. Although this is the eighth ruling in the increasing series of so-called Golden Share judgments, it too raises interesting questions concerning the relationship between the holding of special rights or golden shares by the state in a privatised company and the EC Treaty provisions on the free movement of capital.

The first issue which is analysed is the application of Article 56 EC to the situation where golden shares are not created by legislation but within the framework of domestic company law. The ECJ decided that even in such a situation the member state concerned is acting, not as a private shareholder, but as a public authority whose actions fall within the scope of application of Article 56 EC. This approach by the ECJ is applauded firstly because it prevents member states from escaping the reach of Article 56 EC by having recourse to mechanisms of general company law and secondly because it allows the ECJ to avoid the thorny issue of whether Article 56 EC is capable of horizontal direct effect.

The holding of golden shares as a restriction on the free movement of capital is then examined. In this context the expansive interpretation given by the ECJ to the concept of restriction is criticised. Attention is then focused on the justification ground invoked by the Dutch state with regard to the golden share in TPG NV, namely the need to guarantee a universal postal service.

We study the determinants of stock market development and the growing migration of capital raising, listing, and trading activity to international exchanges. Economies with better fundamentals – better legal systems, greater macro stability – have larger and more liquid markets. As fundamentals improve, however, the degree of migration to international exchanges also increases. Corporations enjoy lower costs and more liquid shares. Consequently, fully-fledged local stock exchanges become less necessary for many economies. Migration can further lead to such a reduction in domestic activity that would render a local exchange unsustainable. Therefore, the functions and forms of stock exchanges in many economies need rethinking.

Legal regimes of limited liability serve different functions governed by distinct normative principles. The enabling function of limited liability aims at facilitating investment in risky activities and at organising principal/agent-relationships within the firm. In this area, choice of law may readily be allowed. At the other end of the spectrum, the protective function of limited liability regimes serves the objective of protecting outsiders from externalisation of risk. In this area, choice of law is much more problematic. Fraudulent transfer law belongs in the latter group, whereas corporate law belongs in the former. However, the German version of a limited liability regime cuts across these distinctions by including the protective function in the normative scope of corporate law, thereby downgrading the law of fraudulent transfers. As will be become apparent, this structural feature explains most of the differences that emerge when comparing the German law of fraudulent transfers with its American counterpart. The recent case law of the ECJ poses a major challenge to the traditional approach. It seems that the best way to deal with the challenge is for German law to develop towards the American model.

This volume arose out of an October 2003 Conference on Corporate Reorganizations and Bankruptcy organized by the Faculty of Law and Center for Company Law at Tilburg University. The principal focus of the issue is corporate governance and bankruptcy reform, but also highlights the European Company (SE) and the theory and practice of cross-border reorganizations and inter-state competition in corporate structures. The special issue has four major sections.

The ECJ's Cartesio judgment should be understood as overriding the Daily Mail judgment of 1988. Under Daily Mail, Community rules governing freedom of establishment were waved away as not applicable, while in Cartesio they are merely not precluding national legislation controlling emigration. According to Cartesio, restrictions on transferring the centre of administration generally pass the test of compatibility. Nonetheless, in the authors' view, there should be no justification for sanctions of annulment or immediate dissolution of a company which has attempted to move its centre of administration to another Member State. In Cartesio, the ECJ proclaimed the right of companies to emigrate for the purpose of conversion into a company form of the host state. By analogy with SEVIC Systems, it seems that the host state may not refuse to give the immigré company permission to convert if similar conversion is open for local legal forms, unless justified by overriding requirements in the public interest. To sum up, the ECJ provides a complex method to determine and protect the freedom of companies to emigrate. Still, this method seems preferable to the other option: forcing Member States to tolerate emigration without regard to their legal tradition and the ensuing difficulties.

This article analyses three decisions of the German Federal High Court concerning the German country-code top-level domain ‘.de’ – mitwohnzentrale.de, shell.de and vossius.de. The analysis shows that the Court referred to economic criteria to justify its decisions in this field of law which is barely regulated by statutory law. The questions whether generic terms should be allocated to private persons as domain names (mitwohnzentrale.de) and whether courts should transfer domain names in the case of a conflict between two rightholders to the same domain name (shell.de and vossius.de) are analysed on the basis of economic criteria. The economic analysis of the first question offers two efficient solutions: (1) owners of generic domain names should be obliged to provide links to the websites of their competitors or (2) generic domain names should be administered by the official registrar, which should provide a portal for the whole branch of industry in question. The answer to the second question is that courts should engage in the transfer of domain names only in cases where bargaining between the parties fails due to a situation of bilateral monopoly with asymmetric information. If the courts decide to transfer a domain name, the original owner must be entitled to receive appropriate compensation.

A recent case in the English High Court, Re Continental Assurance Company of London plc (Singer v. Beckett), constitutes the first judicial pronouncement on wrongful trading (s. 214 of the Insolvency Act) which concerns a major company. The case should render us cautious about the alleged superiority of wrongful trading over creditor protection regimes in other European jurisdictions, notably the German Insolvenzverschleppungshaftung, and the consequential idea of the European Commission to propose a new directive on wrongful trading.

Although this paper focuses primarily on Czech company law, it begins with a description of the general legal development of Czech commercial (including company) law. The first part describes the social and historical background of the Czech law after the period of Communism (1948–1989), some defects ensuing from a paradigmatic understanding of law and problems with Czech case law. The paper tries to manifest that it is impossible to understand the Czech concept of (private) company law without a thorough knowledge of the legal thinking of current Czech judges and the relevant authorities. After this broad introduction, a selection of legal literature dealing with commercial and company law is provided.

The second part of the paper provides some general information on Czech company law, mainly its systematic incorporation into Czech private law and the structure of the Czech Commercial Code. The following sections describe each company type (partnership, limited partnership, limited liability company and joint-stock company) and co-operatives, including the European law connotation, supranational entities and their implementation in Czech law (Societas Europaea, European Interest Groupings and the European Co-operative Society). The anticipated future development of Czech private law (civil and commercial law) is sketched at the end of the paper, taking into account the drafts of the new Civil Code and Commercial Act and other new proposals related to private law.

More and more companies appear with strange abbreviations behind their business name. Consider Chrysler Group LLC (instead of Inc.) or LVMH Montres & Joaillerie France SAS. Some even speak about the ‘endangered corporate form’ and point to the rise of the uncorporation. This primer examines how the uncorporation has evolved in the United States and, more recently, in other economies around the world. We find that the growth in non-listed business forms in Europe, Latin America and Asia has been shaped by a mixture of learning and professional advice arising from the company law review process, as well as by the indirect influence of overseas business forms. We examine the main components of uncorporate business forms that are responsible for limiting transaction costs, curbing opportunism and creating organisational structures that are compatible with entrepreneurial expectations. We show the main differences between the partnership-type and corporatetype uncorporations, particularly the LLC in the United States (US-LLC), the SAS in France and Colombia, and the LLP in the United Kingdom (UK-LLP), Singapore (S-LLP), India (I-LLP) and Japan (Yugen Sekinin Jigyou Kumiai, J-LLP). We find that, given the pitfalls in the evolution of uncorporation laws, an international Model Act would be consistent with lower transaction and information costs and could help to encourage cooperation between firms situated in different jurisdictions.

This article considers the nature of the rules that would need to exist to enable a satisfactory regulatory regime for cross-border banks in Europe in the light of the present crisis. It sets out first what would need to apply in normal circumstances when banks are sound before going to consider how earlier coordinated intervention and ultimately resolution before capital is eroded can be achieved. It suggests in particular that harmonising the detail of regulatory systems would be very time-consuming but not strike at the heart of the problem which is how countries can cooperate across legal boundaries and the structure that banks would need to have to make this feasible. It concludes by exploring the institutional structures that might make this possible, suggesting that if any new European level body is needed, the most important would be a resolution agency as demonstrated by US experience.

The subject of this article is the development of group law in Hungary, which can already be traced back to the time before the fall of the iron curtain in 1989-1990. In particular, the Law on Commercial Companies (LCC) had already since 1988 contained several basic rules on group law. The evolution of Hungarian group law may be described as gradual and reactive. Whilst already in 1988 it had become conceivable that in the foreseeable future groups of companies and the legal problems inherent to them would gain significance, this situation had not then become sufficiently concrete to require a comprehensive legal solution.