The European Private Company: Do We Need Another 28th Private Company Law Form in the EU? On Regulatory Competition of Corporate Law
Discussions on Estonian economic policy: Theory and practice of economic policy. Vol 20, No 1 (2012)
19 Pages Posted: 19 Dec 2012
Date Written: June 15, 2012
Small and medium-sized enterprises (SMEs) are of vital importance for employment, innovation and growth in the EU member states. However, so far only a rather small number participates in international business activities. The European private company is intended to support SMEs’ internationalization. In this paper we analyse whether such an additional supranational legal form is necessary. In a first step we show that from the normative point of view of interjurisdictional competition arguments from welfare economics, public choice and evolutionary economics are mainly in favour of it. In a next step we ask from a positive point of view whether it is nevertheless necessary at all. We discuss to what extent horizontal competition on legal forms is already working within the EU. We find that there is some competition taking place, however, so far it does not address specifically the needs of SMEs when doing business internationally.
Keywords: corporate law, internationalization of small and medium-sized enterprises, regulatory competition, European integration
JEL Classification: F15, H77, K22
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