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Conflicts in the Regulation of Hostile Business Takeovers in the United States and the European Union


Barbara Ann White


University of Baltimore - School of Law

Fall 2003

Ius Gentium, Vol. 9, pp. 161-195, Fall 2003

Abstract:     
This essay focuses on hostile business takeovers to illustrate the significance that cultural differences among nations can play in developing a harmonized European Union law. After 12 years of development, the EU Directive regulating hostile takeovers, to everyone’s surprise, was voted down in the EU Parliament in 2001. The EU Parliament consists of the member nations and the movement to defeat the Directive was led by Germany, which had just suffered a brutal hostile takeover of its largest company by British raiders.

The “harmonization” efforts within the EU (i.e., establishing uniform laws among the member nations) mirrors the federalism movement among the several US states. Though the history of federalism in the US is punctuated with struggles among the several states including no less than the American Civil War, the harmonization efforts by the EU may face even more difficult challenges. Cultural differences among the EU nations are likely stronger than those among the several states in the US since the nations of Europe each have a far longer unique history. Those cultural differences certainly played a role when the EU was developing its takeover law and may have helped to thwart those efforts.

This essay also raises a number of questions about the “received theory” regarding the evolution of transnational uniform business law. First, a closer look at history will challenge the view that nations will naturally gravitate towards a uniform law. Second, a review of the practicalities will question the assertion that a transnational uniform law in all its aspects is necessary to have efficiency. Third, a look at actual cases suggests that the experience of the United States has not always yielded the most “efficient” solutions, at least with regard to economic matters, when applied to European circumstances.

Number of Pages in PDF File: 35

Keywords: hostile business takeovers, European Union, United States, harmonization, states' rights, conservative, liberal, cultural differences, cultural diversity

JEL Classification: K33, K29, F19, M19

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Date posted: June 16, 2010  

Suggested Citation

White, Barbara Ann, Conflicts in the Regulation of Hostile Business Takeovers in the United States and the European Union (Fall 2003). Ius Gentium, Vol. 9, pp. 161-195, Fall 2003. Available at SSRN: http://ssrn.com/abstract=1473116 or http://dx.doi.org/10.2139/ssrn.1473116

Contact Information

Barbara Ann White (Contact Author)
University of Baltimore - School of Law ( email )
1420 N. Charles Street
U Baltimore Law
Baltimore, MD 21201
United States
HOME PAGE: http://law.ubalt.edu/faculty/profiles/white.cfm
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