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Brussels, 4th July 2001

Commission regrets rejection of Takeovers Directive by the European Parliament

The European Commission deeply regrets the rejection by the European Parliament's plenary session (Strasbourg, 4th July) of the proposed Takeovers Directive. The text rejected had previously been agreed by the delegations of the Parliament and the EU's Council of Ministers in a Conciliation Committee meeting in Luxembourg on 6th June 2001 (see MEMO/01/216). The proposed Directive, part of the EU's Financial Services Action Plan, was identified as a top priority by the March 2000 Lisbon European Council as an important step towards making Europe the most competitive economy in the world by 2010.

Internal Market Commissioner Frits Bolkestein said: "I am very disappointed that the European Parliament has not been able to ratify the agreement approved by its delegation last month, despite the tremendous efforts made by the Commission and the Council to meet the Parliament's concerns. Twelve years of work have been wasted by today's decision. This vote represents an important setback for achieving the targets agreed by the EU's Heads of State and Government in Lisbon of realising an integrated European capital market by 2005 and making Europe the most competitive economy in the world by 2010. Financial markets, investors and European companies have been waiting eagerly for this Directive. Fourteen out of fifteen Member States clearly wanted the Directive. It is tragic to see how Europe's broader interests can be frustrated by certain narrow interests."

The proposed Directive, first proposed in 1989, would have guaranteed legal certainty for takeovers by setting minimum guidelines for corporate conduct (see MEMO/01/255). In particular, aimed to ensure an adequate level of protection for minority shareholders throughout the Union when control of a company changed hands. It would also have ensured that employee representatives received full and prompt information on the implications of a takeover bid and that they could inform shareholders of their views on the bid.

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