Response to the European Commission's Report on the Application of the Takeover Bids Directive

15 Pages Posted: 2 Dec 2013 Last revised: 9 Sep 2014

See all articles by Peter Böckli

Peter Böckli

Böckli Bodmer & Partners

Paul L. Davies

University of Oxford- Faculty of Law

Eilis Ferran

University of Cambridge - Faculty of Law; European Corporate Governance Institute (ECGI)

Guido Ferrarini

University of Genoa - Law Department and Centre for Law and Finance; European Corporate Governance Institute (ECGI)

José M. Garrido Garcia

International Monetary Fund (IMF); University of Castilla-La Mancha (Spain)

Klaus J. Hopt

Max Planck Institute for Comparative and International Private Law; European Corporate Governance Institute (ECGI)

Alain Pietrancosta

Sorbonne Law School

Katharina Pistor

Columbia University School of Law

Rolf Skog

Göteborg University - Department of Law

Stanislaw Soltysinski

Komisja Kodyfikacyjna Prawa Cywilnego; Sołtysiński Kawecki & Szlęzak, Legal Advisors

Jaap W. Winter

Vrije Universiteit Amsterdam; University of Amsterdam; Insead

Eddy Wymeersch

Ghent University - Financial Law Institute; ECGI

Date Written: November 30, 2013

Abstract

This paper contains the European Company Law Experts' response to the report of the European Commission of 28 June 2012 on the application of the Takeover Bids Directive of 2004 and the reform initiatives announced. For evaluating these initiatives the rationale of the mandatory bid rule is relevant (exit rationale, control premium rationale and undistorted choice rationale). On this basis the paper discusses each of the concerns raised by the European Commission: 1) The concept of "acting in concert": The ECLE are of the opinion that a uniform concept for the Takeover Bids Directive, the Transparency Directive and the Acquisition Directive is not useful because of the different objectives of these Directives. As to the Takeover Directive it should be made clear that joint engagement activities of investors should not trigger a mandatory offer. 2) National derogations to the mandatory offer rule differ widely, but there are different types of derogations that pose different concerns. The ECLE recommend that the Directive should provide for a review process with respect to national derogations. 3) The ECLE believe that there are good reasons to close the loopholes against the “creep in” and the “creep on” acquisitions. 4) As to board neutrality and the break-through rule the ECLE believe that the default rules should be changed. The option rights should be given to the shareholders, not to the member states. The reciprocity rule is flawed. 5) The protection of the rights of employees should be addressed in a wider context and should not be taken up specifically for one type of transaction such as takeover bids.

Keywords: takeover bids, European Company Law, acting in concert, mandatory bid rule, defensive measures

JEL Classification: G10, G14, G34, K14, K22, K42, N2

Suggested Citation

Böckli, Peter and Davies, Paul L. and Ferran, Eilis and Ferrarini, Guido and Garrido Garcia, José M. and Hopt, Klaus J. and Pietrancosta, Alain and Pistor, Katharina and Skog, Rolf R. and Soltysinski, Stanislaw and Winter, Jaap W. and Wymeersch, Eddy O., Response to the European Commission's Report on the Application of the Takeover Bids Directive (November 30, 2013). University of Cambridge Faculty of Law Research Paper No. 5/2014; Oxford Legal Studies Research Paper No. 55/2014. Available at SSRN: https://ssrn.com/abstract=2362192 or http://dx.doi.org/10.2139/ssrn.2362192

Peter Böckli

Böckli Bodmer & Partners ( email )

St. Jakobs-Strasse 41
PO Box 2348
Basel, 4002
Switzerland

Paul L. Davies

University of Oxford- Faculty of Law ( email )

Harris Manchester College
Oxford, OX1 3TD
United Kingdom

Eilis Ferran

University of Cambridge - Faculty of Law ( email )

10 West Road
Cambridge CB3 9DZ
United Kingdom
+ 44 1223 338335 (Phone)
+ 44 1223 338340 (Fax)

European Corporate Governance Institute (ECGI)

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

HOME PAGE: http://www.ecgi.org

Guido Ferrarini

University of Genoa - Law Department and Centre for Law and Finance ( email )

Via Balbi, 22
16126 Genova, 16100
Italy
+39 010 209 9894 (Phone)
+39 010 209 9890 (Fax)

HOME PAGE: http://www.clfge.org

European Corporate Governance Institute (ECGI)

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

HOME PAGE: http://www.ecgi.org

José M. Garrido Garcia

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

University of Castilla-La Mancha (Spain) ( email )

Toledo 45071
Spain

Klaus J. Hopt

Max Planck Institute for Comparative and International Private Law ( email )

Mittelweg 187
D-20148 Hamburg
Germany
+49 40 41 90 02 05 (Phone)
+49 40 41 90 03 02 (Fax)

European Corporate Governance Institute (ECGI)

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

Alain Pietrancosta

Sorbonne Law School ( email )

17, rue de la Sorbonne
Paris, IL 75005
France

Katharina Pistor

Columbia University School of Law ( email )

435 West 116th Street
New York, NY 10025
United States
212-854-0068 (Phone)
212-854-7946 (Fax)

Rolf R. Skog

Göteborg University - Department of Law ( email )

Viktoriagatan 30
Box 650
Göteborg, 40530
Sweden
+46 31 7866990 (Phone)

HOME PAGE: www.law.gu.se

Stanislaw Soltysinski

Komisja Kodyfikacyjna Prawa Cywilnego ( email )

Ujazdowskie Ave. No. 11
Warsaw, 00-950
Poland

Sołtysiński Kawecki & Szlęzak, Legal Advisors ( email )

Wawelska Str. No. 15B
Warsaw, 02-034
Poland

Jaap W. Winter (Contact Author)

Vrije Universiteit Amsterdam ( email )

De Boelelaan 1105
Amsterdam
Netherlands
+31653978419 (Phone)

University of Amsterdam ( email )

Oude Manhuispoort
Amsterdam
Netherlands

Insead ( email )

Boulevard de Constance
77305 Fontainebleau Cedex
France

Eddy O. Wymeersch

Ghent University - Financial Law Institute ( email )

Universiteitstraat 4
Gent, B-9000
Belgium
+32 9 264 68 27 (Phone)
+32 9 264 68 55 (Fax)

HOME PAGE: http://www.law.ugent.be/fli

ECGI ( email )

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

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