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Brussels, 4th September 2001

Company law: Commission creates High Level Group of Experts

The European Commission has set up a High Level Group of Company Law Experts that will help the Commission to prepare a new proposal for a Directive on the conduct of takeover bids and to define new priorities for the broader future development of company law in the European Union. The group comprises seven members, selected on the basis of their competence in company law and the Commission's desire that the members should have broad experience of the various legal and economic systems in the EU. The group will hold its first meeting on 11 September 2001. It is due to deliver a preliminary report on its recommendations to the Commission concerning rules for takeover bids by the end of 2001 and a final report concerning broader issues for the development of EU company law by mid-2002.

Internal Market Commissioner Frits Bolkestein said "This High Level Group has been set up because the Commission wants to get top quality independent advice from leading European experts in the first instance on pan-European rules for takeover bids and subsequently on key priorities for modernising company law in the European Union. A clear set of pan-EU rules for the conduct of takeovers stands to benefit European companies and shareholders, especially minority shareholders, by clarifying their rights and obligations. It would also facilitate the goal set by the Lisbon Summit of restructuring the European economy to make it the most competitive in the world by 2010. The European Parliament's vote of 4 July to not endorse a previous proposal for a Takeovers Directive was very disappointing. However, the creation of this Group demonstrates the Commission's determination to come forward as soon as possible in 2002 with a new proposal that takes account of the broadest range of views".

The group comprises:

  • Chairman Jaap WINTER, Professor and legal advisor UNILEVER, Netherlands

  • José Maria GARRIDO GARCIA, Professor at the University of Castilla-La Mancha, Spain

  • Klaus J. HOPT, Geschäftsführender Direktor Max-Planck-Institut, Germany

  • Jonathan RICKFORD, Consultant for the Department of Trade and Industry, United Kingdom

  • Guido ROSSI, former President of the Italian stock exchange supervisory body CONSOB, Italy

  • Jan CHRISTENSEN, Professor at the University of Copenhagen, Denmark

  • Joëlle SIMON, Legal Affairs Director, Employers' Federation (MEDEF), France.

The Group will hold its first meeting on 11 September 2001. Taking account of the positions of the EU's Council of Ministers and the European Parliament during the last stages of negotiation of the previous proposal for a Takeovers Directive (see MEMO/01/255), the Group of High Level Experts will initially consider the following three issues:

  • how to ensure the existence of a level playing field in the EU concerning the equal treatment of shareholders across Member States

  • the definition of the notion of an "equitable price" to be paid to minority shareholders and

  • the right for a majority shareholder to buy out minority shareholders ("squeeze-out procedure").

The Group is due to deliver a report on these issues, including possible solutions, to the Commission's services by the end of 2001.

During a second stage, the Group is due to provide recommendations for a modern regulatory European company law framework designed to be sufficiently flexible and up-to-date to meet companies' needs, taking into account fully the impact of information technology. The Group will examine best practice developed in the Member States (as well as in the USA) and consider a range of issues including the following:

  • the creation and functioning of companies and groups of companies, co-operatives and mutual enterprises, including corporate governance

  • shareholders' rights, including cross-border voting and virtual general meetings

  • corporate restructuring and mobility (for instance, the transfer of the corporate seat)

  • the possible need for new legal forms (for instance, a European Private Company, which would be of particular relevance for SMEs)

  • the possible simplification of corporate rules in light of the SLIM report on the Second Company Law Directive of 13 December 1976 on the formation and capital maintenance of public limited liability companies.

The Group is due to deliver a final report to the Commission's services by mid-2002.

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