EU Company Law Convergence Possibilities after Centros

Abstract

This paper considers the possibilities for company law convergence in the aftermath of the European Court of Justice's landmark Centros decision. The Centros decision introduces the possibility of regulatory competition among EU Member States for company charters. However, entrenched cultural and political features may dissipate the competitive pressures that would give rise to formal convergence of company law statutes. This paper argues that Member States' statutes are more likely to functionally converge in an effort to effectively compete for new incorporations. This paper also considers the possibility of specialization among EU Member States' statutes. Rather than offering a bundle of corporate goods that attempt to appeal to all businesses seeking to incorporate within a jurisdiction, Member States may attempt to craft their corporate codes and associated regulatory institutions to appeal to certain types of companies or industries.

Keywords: Convergence, EU Company Law, Comparative Corporate Law, Comparative Corporate Governance

JEL Classification: G38, G30