The Changing Landscape of EU Company Law
Joseph A. McCahery
Tilburg University - School of Law; European Banking Center (EBC); European Corporate Governance Institute (ECGI); Duisenberg School of Finance; Tilburg Law and Economics Center (TILEC)
Erik P. M. Vermeulen
Tilburg University - Department of Business Law; Philips International BV; Tilburg Law and Economics Center (TILEC); Kyushu University - Faculty of Law
TILEC Discussion Paper No. DP2004-023
This is a time of spirited debate about regulatory competition in Europe. Discussions about competitive lawmaking abound. At the same time, the introduction of the European Company and the further harmonization attempts by the European Commission puts questions about the necessity of EU intervention into the company laws regulated by the member states. We, however, see no cause for excitement on either front.
This article explains why not, drawing on analytical tools from law and economics. Analyzing the history of EU company law, we locate a stable noncompetitive equilibrium, which prevails in the EU. This equilibrium follows from member states that founded the EU unwilling to give up their lawmaking authority regarding company law issues. Since then, stability has ruled. The agenda-setting in EU company law changed little during the existence of the EU. Operative incentives, market structure, and regulatory results have been more constant than dynamic, even as recent case law of the European Court of Justice triggered a loud discussion about competitive lawmaking in the EU.
Number of Pages in PDF File: 44
Keywords: Company Law, Legal Evolution, Regulatory Competition
JEL Classification: K22, F15, G38working papers series
Date posted: December 19, 2005
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