Upload File

introduction

21
Nationality of Nationality of Corporations Under Corporations Under Domestic Law: A Domestic Law: A Comparative Perspective Comparative Perspective Dr Matthias Pannier Dr Matthias Pannier Research Fellow in European Law The Fourth Public Conference of the British Institute of International and Comparative Law’s Investment Treaty Forum

Upload: alohilani-matthew

Post on 02-Jan-2016

25 views

Category:

Documents


0 download

Report

Tags:

DESCRIPTION

Nationality of Corporations Under Domestic Law: A Comparative Perspective Dr Matthias Pannier Research Fellow in European Law The Fourth Public Conference of the British Institute of International and Comparative Law’s Investment Treaty Forum. Introduction. - PowerPoint PPT Presentation

TRANSCRIPT

Page 1: Introduction

Nationality of Corporations Nationality of Corporations Under Domestic Law: A Under Domestic Law: A

Comparative PerspectiveComparative Perspective

Dr Matthias PannierDr Matthias Pannier

Research Fellow in European Law

The Fourth Public Conference of the British Institute of Internationaland Comparative Law’s Investment Treaty Forum

Page 2: Introduction

Introduction

1)1) Rival approaches in Private International Company Rival approaches in Private International Company Law.Law.

2)2) Comparative overview (incorporation countries and Comparative overview (incorporation countries and real seat countries).real seat countries).

3)3) EU approach, influence of the freedom of EU approach, influence of the freedom of establishment and the free movement of capital.establishment and the free movement of capital.

4)4) Impact of BITs on conflict of law rules.Impact of BITs on conflict of law rules.

5) Treaty shopping and regulatory competition.

Page 3: Introduction

Rival approaches

Lex societatisLex societatis: : The law regulating the internal The law regulating the internal affairs of a company.affairs of a company.

Connecting factors:Connecting factors:• Control.Control.• Incorporation.Incorporation.• Real seat.Real seat.• Market place, listing.Market place, listing.

Page 4: Introduction

Control Theory

Refers to the nationality of the persons Refers to the nationality of the persons controlling the company. controlling the company.

• No clear distinction between legal status of No clear distinction between legal status of shareholders and of companies.shareholders and of companies.

• Widespread Widespread ownership of companies, change ownership of companies, change of control.of control.

• Groups of companies: Braches and Groups of companies: Braches and subsidiaries.subsidiaries.

Page 5: Introduction

Incorporation Theory (1)

• Applies the law of the place where a company Applies the law of the place where a company has been incorporated.has been incorporated.

Advantages: Advantages: • Certainty, unambiguous determination of Certainty, unambiguous determination of lexlex

societatissocietatis..• Private autonomy and mobility, company does Private autonomy and mobility, company does

not lose its legal status just by expanding not lose its legal status just by expanding business, transfer of company's seat across business, transfer of company's seat across border is possible.border is possible.

Page 6: Introduction

Incorporation Theory (2)

Disadvantages:Disadvantages:

• Pseudo-foreign corporations.Pseudo-foreign corporations.• Founders can choose a law which gives less Founders can choose a law which gives less

protection to shareholders or creditors than the protection to shareholders or creditors than the law of the country where they actually do most law of the country where they actually do most of their business (race to the bottom?).of their business (race to the bottom?).

• Circumvention of national law.Circumvention of national law.

Page 7: Introduction

Real Seat Theory (1)

• Uses the seat as the connecting factor Uses the seat as the connecting factor determining the law applicable to the determining the law applicable to the company’s affairs.company’s affairs.

Advantages:Advantages:• Anti – evasion.Anti – evasion.• Protection of the home domestic market; law of Protection of the home domestic market; law of

the state which is mostly affected by the the state which is mostly affected by the company.company.

• Prevents pseudo foreign companies.Prevents pseudo foreign companies.

Page 8: Introduction

Real Seat Theory (2)

Disadvantages: Disadvantages: • Determination of real seat difficult.Determination of real seat difficult.• Different terms and concepts in different Different terms and concepts in different

countriescountries

““Real Seat” “Siege Reel” Real Seat” “Siege Reel” “Head Office” “Head Office” “Central Management and Control” and the “Central Management and Control” and the common law “Residence”common law “Residence”

• Anti-competitive – major inhibition on founding Anti-competitive – major inhibition on founding and trading companies at will.and trading companies at will.

Page 9: Introduction

Market place – Listing

• City Code: offers for public companies resident City Code: offers for public companies resident in the UK, the Channel Islands and the Isle of in the UK, the Channel Islands and the Isle of Man (whether or not their shares are listed).Man (whether or not their shares are listed).

• France: offers for public companies (French or France: offers for public companies (French or foreign) listed on a French stock exchange.foreign) listed on a French stock exchange.

• Germany: offers for public companies which Germany: offers for public companies which have their seat in Germany which are listed on have their seat in Germany which are listed on an EU/EEA stock exchange.an EU/EEA stock exchange.

• Austria: offers for public companies which Austria: offers for public companies which have their seat in Austria and are listed on an have their seat in Austria and are listed on an Austrian stock exchangeAustrian stock exchange..

Page 10: Introduction

Comparative Overview (1)

Incorporation CountriesIncorporation Countries

e.g. USA, Canada, UK, Ireland, many other e.g. USA, Canada, UK, Ireland, many other common law states, The Netherlands, Austria common law states, The Netherlands, Austria since 2000, Denmark, Sweden, Finland, since 2000, Denmark, Sweden, Finland, Switzerland since 1987, Liechtenstein, Switzerland since 1987, Liechtenstein, Hungary, Romania, China.Hungary, Romania, China.

Page 11: Introduction

Comparative Overview(2) England

• Henriques v Dutch West India CoHenriques v Dutch West India Co (1728). (1728).Existence, dissolution and capacity for rights Existence, dissolution and capacity for rights and obligations of a foreign company and obligations of a foreign company incorporated under foreign law will be incorporated under foreign law will be recognized in England.recognized in England.

• UK applies significant parts of its laws to all UK applies significant parts of its laws to all foreign companies on basis of presence foreign companies on basis of presence (overseas companies).(overseas companies).

• Some independently on basis of public policy - Some independently on basis of public policy - fraudulent trading, security interests fraudulent trading, security interests disclosure.disclosure.

Page 12: Introduction

Comparative Overview(3) The Netherlands

• Adopts Incorporation doctrine after Hague Adopts Incorporation doctrine after Hague Recognition Convention in 1959.Recognition Convention in 1959.

• WetConflichtenrechtCorporatiesWetConflichtenrechtCorporaties (WCC) 1998 (WCC) 1998 Art1(2).Art1(2).

• Law on Pro Forma Companies 1998 ie Law on Pro Forma Companies 1998 ie “tramps”.“tramps”.

Page 13: Introduction

Comparative Overview (4)

Traditionally Real Seat CountriesTraditionally Real Seat Countries

e.g.e.g.France, Germany, Belgium, Luxembourg, France, Germany, Belgium, Luxembourg, Portugal, Spain, Poland, Greece, Turkey.Portugal, Spain, Poland, Greece, Turkey.

Page 14: Introduction

Comparative Overview (5)France

• Traditionally: Law applicable to company is Traditionally: Law applicable to company is that of real seat (siège social) “La direction that of real seat (siège social) “La direction superieure et contrsuperieure et controole de la soc”. Art L210-3 le de la soc”. Art L210-3 Code de Commerce, Art 1837 Code Civil.Code de Commerce, Art 1837 Code Civil.

• But law is ambiguous. Companies with “siège But law is ambiguous. Companies with “siège social” in France are subject to French law; 3rd social” in France are subject to French law; 3rd persons may rely on “siège statutaire” (reg persons may rely on “siège statutaire” (reg seat) but companies may not invoke it against seat) but companies may not invoke it against 3rd parties if real seat is not reg seat.3rd parties if real seat is not reg seat.

• Only applies French law never applies foreign Only applies French law never applies foreign law.law.

Page 15: Introduction

Comparative Overview(6) Italy

• Private International law Code 1995, Article 25.Private International law Code 1995, Article 25.• Italian law applies where the seat of Italian law applies where the seat of

management and location of principle object is management and location of principle object is in Italy. But otherwise asserts that companies in Italy. But otherwise asserts that companies are governed by the law of the state where their are governed by the law of the state where their incorporation was completed.incorporation was completed.

• But no reciprocity – a foreign company moving in But no reciprocity – a foreign company moving in to Italy is not given the benefit of its to Italy is not given the benefit of its incorporation - must be reformed as an Italian incorporation - must be reformed as an Italian company. But an Italian company moving out company. But an Italian company moving out stays Italian.stays Italian.

Page 16: Introduction

Comparative Overview(7) Germany

• Courts rigorously applied Real Seat Theory Courts rigorously applied Real Seat Theory ((SitztheorieSitztheorie).).

• Real seat = centre of management is the place Real seat = centre of management is the place where the fundamental decisions of the board where the fundamental decisions of the board are taken effectively carried out.are taken effectively carried out.

• Reciprocal in sense that applies to foreign cos Reciprocal in sense that applies to foreign cos seated in Germany and German cos seated seated in Germany and German cos seated abroad. abroad.

• German law uses a German law uses a renvoirenvoi back. back. • Change after Change after ÜberseeringÜberseering..

Page 17: Introduction

EU approach

• Recognition Convention 1968 based on Art Recognition Convention 1968 based on Art 293 EC never entered into force.293 EC never entered into force.

• Freedom of establishment Arts 43, 48 EC.Freedom of establishment Arts 43, 48 EC.Case C-208/00 Case C-208/00 Überseering BV v Nordic Construction Überseering BV v Nordic Construction Company Baumanagement GmbHCompany Baumanagement GmbH (NCC) [2002] ECR (NCC) [2002] ECR I-9919;I-9919;Inspire Art Inspire Art Case C-167/01 Case C-167/01 Kamer van de Koophandel Kamer van de Koophandel en Fabrieken voor Amsterdam v Inspire Art Ltden Fabrieken voor Amsterdam v Inspire Art Ltd [2003] [2003] ECR I-10155.ECR I-10155.

• Supranational company: Societas Europaea.Supranational company: Societas Europaea.Art 7 SE-Statute: Registered office shall be located in Art 7 SE-Statute: Registered office shall be located in the same Member State as its head office.the same Member State as its head office.

Page 18: Introduction

Impact of BITs on conflict of law rules

• Can BITs overrule national conflict of law Can BITs overrule national conflict of law rules?rules?

• Do real seat countries even have to recognize Do real seat countries even have to recognize companies formed in accordance with the companies formed in accordance with the rules of an incorporation country but having rules of an incorporation country but having their real seat in the real seat state (host their real seat in the real seat state (host state)?state)?

• German Supreme Court (VIII ZR 155/02, BB German Supreme Court (VIII ZR 155/02, BB 2003, 810, 812) on the American-German 2003, 810, 812) on the American-German Commerce Treaty of 1954; based on ECJ Commerce Treaty of 1954; based on ECJ Case C-208/00 Case C-208/00 ÜberseeringÜberseering..

Page 19: Introduction

Treaty shopping and Regulatory Competition in

company law (1)

Economic theoriesEconomic theories• State failure and market failure (Tiebout).State failure and market failure (Tiebout).

Legislators shall be disciplined by market Legislators shall be disciplined by market forces.forces.

• Evolutionary market process and competition Evolutionary market process and competition (Hayek)(Hayek)

Instrument for creation and distribution of new Instrument for creation and distribution of new knowledge.knowledge.

Page 20: Introduction

Treaty shopping and Regulatory Competition in

company law (2)

US-American precedence:US-American precedence:• "race to the bottom“."race to the bottom“.• "race to the top“."race to the top“.• ““vertical competition”.vertical competition”.

European discussion:European discussion:• Opposition.Opposition.• Impossibility.Impossibility.• Support from Support from CentrosCentros, , ÜberseeringÜberseering, , Inspire Inspire

ArtArt..

Page 21: Introduction

Final Remarks

• Objectives of Investment Treaties must be Objectives of Investment Treaties must be reflected in nationality definitions of BITs.reflected in nationality definitions of BITs.

• Control: change of control, difficult to define Control: change of control, difficult to define control in such cases. control in such cases.

• Real Seat: Companies are restricted in their Real Seat: Companies are restricted in their mobility. mobility.

• Incorporation: problems in the cases where Incorporation: problems in the cases where investors of the host state abuse this rule investors of the host state abuse this rule (exception).(exception).

• Flexibility rule based on mutual recognition.


voip-iptel-introduction-SRK1.ppt voip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-iptel-introduction-SRK1.pptvoip-ip

Introduction and Thesis Introduction - …...1 Introduction and Thesis Introduction: The introduction relates the topic to the main point of the essay. The introduction is composed

1. INTRODUCTION • INTRODUCTION • EINFÜHRUNG • INLEIDING • INTRODUCCIÓN … · 2016-12-16 · 1. INTRODUCTION • INTRODUCTION • EINFÜHRUNG • INLEIDING • INTRODUCCIÓN

An Introduction to NSAn Introduction to NS2An Introduction

PRODUCT INTRODUCTION Company Introduction

CrowPiwithMineCraftPiEdition · 2 CrowPiwithMineCraftPiEdition-Introduction-MinecraftPiEdition-Introduction-Whatyouwillneed-Introduction-RunningMinecraft-Introduction

Introduction - daks2k3a4ib2z.cloudfront.net€¦ · Introduction Establishedin1974MarbleHillFireplacesofferoneofthelargestandmostcomprehensiveselectionsof …

URBAN STREAM REHABILITATION. INTRODUCTION, OBJECTIVES & IMPACTS INTRODUCTION, OBJECTIVES & IMPACTS INTRODUCTION, OBJECTIVES & IMPACTS INTRODUCTION, OBJECTIVES

VisionaryScancombinesarichsetofqualitycontrolandproductivi ... · Introduction Introduction VisionaryScancombinesarichsetofqualitycontrolandproductivityfeatureswithasimpleinterfacedesignedspecificallyforscanningandcodingdepositionexhib-

The Sacrament of Baptism Introduction Video Introduction Video The Sacrament of Baptism Introduction Video Introduction Video

Industry introduction Industry introduction Company introduction Company introduction Production introduction Display time time content

1 Introduction t 1. Introduction to Nanotechnology - UFAMhome.ufam.edu.br/berti/nanomateriais/Introduction to Nanotechnology... · Introduction t 1. Introduction to Nanotechnology

Introduction to Elasticsearch and Logstash. - KIT · PDF fileOutline 1 Introduction 2 Logstash Introduction 3 Elasticsearch Introduction 4 Conclusions Introduction Logstash ElasticsearchConclusions

An Introduction to NSAn Introduction to NS2An Introduction ...teerawat/publications/NS2/02-NS2.pdf · An Introduction to NSAn Introduction to NS2An Introduction to NS2 Textbook: T

§1.1.1 INTRODUCTION: 1. INTRODUCTION

Introduction Introduction Introduction Introduction

Introduction to Transducers, Introduction to Transducers ...engtech.weebly.com/.../more_on_transducers_sensors_actuators.pdf · Introduction to Transducers, Introduction to Transducers,

Introduction: Definition Introduction: Philosophy

Introduction Introduction (ctnd.)

General introduction 1.1 Introduction

1. Introduction 1. Introduction 1. Introduction 1 ... · Introduction 1. Introduction 1. Introduction 1. Introduction 6061B0242401. The Phone Screen From the Phone screen, you can

Systems Analysis I introduction I introduction. 2Systems Analysis - Introduction Contents Introduction Introduction 3 classic phases 3 classic phases

Introducción / Introduction / Introduction

Introduction - University of Cambridge · Introduction. Introduction

Introduction€¦ · Introduction ThisdocumentprovidesinformationabouttheIOSXEsoftwarereleasefortheCiscoNCS4201andCisco …

An Introduction for An Introduction for Introduction for ......An Introduction for An Introduction for Introduction for TeachersTeachersTeachers . exChange, Blackburn Cathedral’s

Optimisation des Requêtes. Introduction Introduction

R as a Web Service Introduction Introduction Introduction

introduction | EinlEitung | introduction | introducción · introduction | EinlEitung | introduction | introducción En Description Operation Maintenance Safety instructions dE Benennung

Module: Introduction...Module: Introduction Page: Introduction CC0.1 Introduction Please give a general description and introduction to your organization. Providing electrical, hydraulic

Introduction & Strategy Module Introduction & Administrative

1. INTRODUCTION 1.1 Introduction

INTRODUCTIONS (LEADS) Creative introduction Action introduction Dialogue introduction Personal introduction Question introduction Quotation introduction

An Introduction to NSAn Introduction to NS2An Introduction to NS2 · 2016. 8. 26. · An Introduction to NSAn Introduction to NS2An Introduction to NS2 Textbook: T. Issariyakul and

Introduction and Welcome€¦ · Introduction and Welcome Introduction 4