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.

The field of comparative corporate governance is currently undergoing what may amount to a paradigm shift. Since the seminal analysis of the modern corporation by Berle and Means in 1932, the large publicly held corporation with dispersed shareholders as owners unable to effectively control management has dominated the field not only in the United States, the origin country of the Berle & Means corporation, but also elsewhere. Recent empirical analyses, however, document that the corporation with dispersed owners is much less common than typically assumed. As a result, many of the assumptions that have driven the analysis of the corporate sector in the past are currently undergoing review. To a large extent, the fresh look at the corporation, its ownership structure and performance, and the legal framework in which it operates can be attributed to the recent experience of the transition economies. Reform strategies that were implemented in these countries over the past decade included the reorganization of state owned enterprises into marketable share companies and their subsequent privatization. Corporatization and privatization were expected to lead to enterprise restructuring and improved performance. In fact, these expectations materialized only slowly, if at all, and, as will be further discussed below, the emerging enterprise structures in these countries looks quite different from earlier predictions. Cynics may say that these countries became the testing ground for empirically unfounded corporate finance theories. In fact, many privatization programs in transition economies were designed and advised by US trained financial economists who have now taken the lead in challenging the very same assumptions on which their advice had been based. While they earlier predicted that institutions will follow the market, they now argue that institutions, in particular legal institutions, are determinants of the ownership structure of firms and the development of capital markets. In any event, the process of transforming centrally planned economies into market economies has revealed how little is understood about markets and firms or the role of law and legal institutions for their functioning.

The Societas Europaea (SE) has developed unexpected popularity in Germany (cf., the empirical study in Eidenmüller, Engert and Hornuf, Die Aktiengesellschaft 2008, 721 et seq.). Since the incorporation of Allianz SE, more publicly listed enterprises have taken this legal form (e.g., BASF SE, Fresenius SE, Porsche SE). The SE has become attractive to mid-sized companies in Germany as well. Legal advisers and legal scholars in Germany consequently have had a breadth of experience with this new supranational company type. This experience forms the basis of the following recommendations to further improve the legal framework and increase the attractiveness of the SE for large and mid-sized companies in Germany and Europe.

The Spanish university system has witnessed many changes during the last thirty years. Initial conditions for competition were established in 1983, especially through the legal recognition of private universities. However, a shortage of students since 1998 and a drop in demand for higher education, which has been aggravated by an extraordinary increase in supply, has prompted further reform in the past few years. A new regulation was adopted in 2001 in order to impose market-like behaviour and privatise some of the operating conditions of State universities, such as the freedom of students to choose their university, hiring policies, quality assessment and public accountability, the allocation of research funds and rankings. Although it is probably too early to assess the impact of these changes, it is clear that public funding remains largely unchanged. This is a key issue that needs to be addressed in order to create the appropriate conditions for competition in the higher education industry. Although the market has been introduced into the provision of higher education in Spain, the continued public funding of State universities creates a powerful distortion that prevents the development of a truly fair and competitive market.

This is the time of the making or breaking of Europe. When over one generation from now we will be looking back at this period of the turn of the century we will recognize this as the period during which we finally made it, or we finally blew it. By the time the new EURO notes will slide through the money machines, the Europe that we have known will have changed forever. The reason lies in the stark political choices that are facing the European Union. The outcome of these political choices will be decisive for the shape of the European tax policy in the years to come.2

This article discusses the management of systemically important banks in distress with the primary aim of creating a platform for further discussion. As a backdrop, the experiences gained in Sweden from two crises in less than 20 years are presented. After a discussion of the liquidity factor and central banks' role as lender of last resort, the focus is on handling the initial acute phase of a crisis. The appropriate goals of a crisis management system are discussed, as are ways of achieving immediate control of a bank in distress and principles related to the valuation of a bank in need of assistance. The main point presented is that the analytical building blocks are universal and by identifying them a common ground for further analysis could be established. One conclusion is that the proposed EU regime for crisis management in the financial sector will not be the final word. Finally, some thoughts regarding a pan-European system for crisis handling, based on a common corporate law for banks, are presented.

The financial crisis has demonstrated the importance of strengthening liquidity risk management and supervision. Such strengthening must take account of the system-wide dimension of risks: the likelihood that a number of firms will face a common stress at the same time, and the impact of their response to that stress on other firms and the wider system. Five high-level objectives are presented to guide the future development and design of a framework to contain system-wide liquidity risks.

Starting from the suggestion that external costs are created by the plenary private order regime – in short, that ‘private ordering’ is not truly private – the author advocates restrictions based on social welfare, and not traditional fairness, concerns when crafting limits on the extent to which participants in business firms can reorder their relations inter se from the statutorily defined relationship. A constructive start to this discussion would be to acknowledge that private ordering generates costs, some of which are social. Having done so, we could agree that an aggregate net social calculation of value and cost is appropriate to see if plenary private ordering is justified and, if not, to determine the appropriate level of private ordering. This policy discussion provides a valuable reminder of the value of commonality in these matters. Jurisdictions benefit when we adopt common modes of analysis, shared nomenclature and harmonisation statutes. That value of commonality has been too often put aside as we are guided by market-oriented generalisations which focus too heavily on the presumed benefits to individual participants and firms and ignore the social dimensions of public policy formation.

A rating trigger is a particular type of debt covenant that mandates the borrower to maintain its own credit rating above a certain rating threshold, requiring, in the event of a rating downgrade, the adoption of specific enforceable actions aimed at securing the lender claims from the borrower's higher risk level. Rating triggers lower the cost of borrowing capital, but when activated, they exacerbate the borrower's need for liquidity just at the moment when its credit risk is higher, making the borrower's default more likely to occur. Despite the potential threat posed by rating triggers on debt markets, these contractual devices remain almost unregulated both in the US and in Europe. The purpose of this paper is first to analyse the effects rating triggers can have on overall market risk and second to assess the proliferation of rating triggers among large US and non-US companies in order to establish whether these contractual devices need stricter regulation. The article is divided in two parts. Sections 2 to 5 provide an overview of the different types of triggers and analyse the rationale behind their use in terms of advantages and disadvantages for both issuers and investors. In sections 6 to 9, I perform an empirical analysis by assessing the rating triggers that have been used by Dow Jones Industrial Average Index companies. I then examine the correlation between the use of rating triggers and the companies' risk profiles by measuring their credit ratings and their Altman's Z-Scores in order to find out whether triggers are mostly used by risky companies, capable of being impaired by the triggers' activation and thus posing a threat to market stability. In section 10, I strengthen the analysis by examining whether such correlation also applies to non-US companies which use rating triggers. In section 11 conclusions are drawn suggesting the introduction by US and European regulators of a specific duty to disclose all the rating triggers that listed companies include in bond indentures and in financial contracts every year.

All over Europe, we see drastic changes being made to simplify company law and make it more flexible. A fundamental principle of this reform movement is the freedom of shareholders to determine internal structure and power balance. At the same time, as a consequence thereof, we may see more situations in which minority shareholders at some point may feel trapped. More freedom and flexibility will therefore need to be supplemented with a credible and efficient level of minority protection. Until now, the general approach in Europe (but also to a certain extent in the United States) is that shareholders only have a right to exit through a buy out if the conduct of the controlling shareholder(s) is unfair and/or oppressive. One can doubt whether this provides an acceptable level of protection in terms of efficiency and effectiveness. In this article, it will be submitted that it might be economically sound, as well as efficient, effective and satisfactory from a legal point of view, for the law to go further and award minority shareholders a right to exit the company ‘at will’ provided that (i) a reasonable notice period is observed and (ii) additional costs of financing are taken into account.

Our notions of dispute resolution revolve around parties with competing contentions receiving some form of adjudication or resolution through settlement. A more accurate approach involves seeing disputes in a different way. At one extreme, we may have a case litigated before a country's Supreme Court. At the other, there may be the germs of a problem that nobody has articulated as such. This has the ability to become that court case. More likely, though, it will just wither away. An innocent victim may resolve to take his business elsewhere or even to desert an entire sector of commerce. He is no less in dispute than the serious litigant.

The 1990s witnessed the European début of a series of securities markets for high-growth companies adopting as their regulatory model the National Association of Securities Dealers Automated Quotation (NASDAQ) market in the USA. These markets are generally known as New Markets.

In its ruling in IMS Health, the European Court of Justice formulates four cumulative conditions to test whether there has been abuse of a dominant position within the meaning of Article 82 EC in the case of a refusal to license an intellectual property right (IPR). The Community courts only find an abuse of dominance in cases of non-licensing of an IPR in ‘exceptional circumstances’. The four conditions are an elaboration of this main criterion, and they revolve around the elements of ‘indispensability’, ‘new product’, ‘exclusion of all competition’ and ‘objective grounds for a licence refusal’.

However, the judgment leaves several questions unanswered, such as on the requirement of the introduction of a new product and on the issue whether the conditions stipulated are (equally) applicable in all competition cases in which IPRs play a central role. In the Microsoft case, currently pending before the Court of First Instance, the Community judicature will have to deal with these questions once more.

One of the situations in which a different interpretation might pertain to the main criterion of ‘exceptional circumstances’, an interpretation that tends more towards a general ‘essential facilities’ approach combined with elements of the ‘leverage theory’, concerns the field of information technology and software development. This scenario involves cases in which a software producer is asked to release certain information to enable other software products to connect with its operating system. The question is whether a small part of an innovation protected by intellectual property law should be disclosed to a competitor. With such information, it would be possible for that competitor to market his own software product. It is important, of course, that the information provided should not represent an essential part of the core activity or functionality of the licensee's product.

Lower barriers of entry for new firms and more flexibility in structuring a business organisation are the two key factors motivating the introduction of the new company law. In general, policymakers use new company law initiatives to encourage entrepreneurship, innovation and cooperative arrangements. This paper distinguishes the diverse strands of company law reforms arising in the United States, Europe and Asia and points to the underlying conditions that shape the markedly different reform outputs. Our analysis points to three important factors – (1) private ordering; (2) fiscal transparency; and (3) limited liability – that effect the incentives for new firm creation. However, we find that many of the new company law reforms are incomplete. Nevertheless, these new company law reforms retain the ability to generate rents due to their adaptability and responsiveness to social and economic change.