European studies

ALESSANDRA PAOLINI

The course has as a target the understanding of the actual structure of European Company Law, particularly with regards to recent harmonisation and simplification processes. It aims also at stimulating the student to reflect, through a critical analysis of legislative material and court cases, on the impact of Company Law harmonisation and choice of law on developments in national Company Law, as well as on the relevance of regulatory competition and regulatory arbitrage for the internal market.
Knowledge and understanding

Critical knowledge of the core subjects related to the course, in both international and national law perspective, in a systematic perspective. Knowledge and understanding of the economic ratio behind the issues of Company Law, taking into account the international debate and the political-economic implications.

Applying knowledge and understanding

Ability to apply knowledge acquired during the course in order to analyse and discuss controversial cases in a consistent way.

Making judgements

Improvement of the ability to understand and critically assess the core subjects related to the course, considering also the political-economic implications; ability to connect, in a consistent way, the different issues examined in the course.

Communication skills

Improvement of the ability to describe and discuss, in a clear and appropriate legal language, the core subjects and the controversial issues of European Company Law.

Learning skills

Improvement of the ability to study in an independent and critical way.

The course has as a target the understanding of the actual structure of European Company Law, particularly with regards to recent harmonisation and simplification processes. It aims also at stimulating the student to reflect, through a critical analysis of legislative material and court cases, on the impact of Company Law harmonisation and choice of law on developments in national Company Law, as well as on the relevance of regulatory competition and regulatory arbitrage for the internal market.
Knowledge and understanding
Critical knowledge of the core subjects related to the course, in both international and national law perspective, in a systematic perspective. Knowledge and understanding of the economic ratio behind the issues of Company Law, taking into account the international debate and the political-economic implications.
Applying knowledge and understanding
Ability to apply knowledge acquired during the course in order to analyse and discuss controversial cases in a consistent way.
Making judgements
Improvement of the ability to understand and critically assess the core subjects related to the course, considering also the political-economic implications; ability to connect, in a consistent way, the different issues examined in the course.
Communication skills
Improvement of the ability to describe and discuss, in a clear and appropriate legal language, the core subjects and the controversial issues of European Company Law.
Learning skills
Improvement of the ability to study in an independent and critical way.

Although there are no formal prerequisites, it is advisable to have already taken at least one exam in the private law area.
Students should indeed have a basic knowledge of Civil Law (particularly with regards to property, contracts, power of attorney) and possibly, some basics in Company Law, as well as a good knowledge of English language (minimum level: B2).

The course will cover the following subjects:
1) Introduction to the course European Company Law
Methodology of the Course
Sources of the European Company Law
Types and Functions of Companies
The distinction between closely held and publicly traded corporations/companies.
Law versus Contract incorporate affairs. Mandatory Law versus Default Provisions.
Regulatory Competition.
Common structures of Corporations/Companies: legal personality; limited liability; transferability of shares; investor ownership

2) Cross-Border Establishment and Corporate Mobility
- Real seat theory and incorporation theory
- Right of primary Establishment (Daily Mail, Überseering, Sevic, Cartesio, Vale, Polbud Cases)

3) Right of secondary Establishment (Segers, Centros, Inspire Art Cases)
- Cross-border conversion (Vale, Polbud cases). The recent EU directive on cross-border conversion, merger and division.
- The current Debate: twenty years after Centros decision.
Cross-border conversion in Dir. 2019/2121

4) Formation of a new company
- Setting up a new company: instrument of incorporation- articles of association – preventive control – registration
Validity of obligations entered into by the company
Nullity of the Company
Private companies/public companies/State owned companies
Cases: Job Centre I and II; Ubbong Isolatie BV

5) The essential elements of the company’s financial structure. The concept of company capital; the differences in this regard between continental European and Anglo-American company law; the debate on the advantages and inconveniences of capital-based company law systems compared to those that ignore this concept; the imposition by law of a minimum capital; capital formation and capital contributions; capital maintenance: recapitalise or liquidate rule and its role

6) Capital maintenance
- Dividend distribution
- Non mandatory capital reduction
- Transaction on the company’s own shares
- Financial assistance
Companies with symbolic capital in European law

7) Annual and consolidated accounts
- annual accounts;
- accounting principles;
- IAS/IFRS principles;
- Consolidated accounts
- Audit

8) Corporate Governance
- What is Corporate Governance?
- ECL corporate governance goals (transparency and engagement of shareholders);
- one tier vs. two tier systems.
- Board of directors
- boards in listed companies;
- Directors’ liability
- Conflict of interests
- Powers of representation
- executive remuneration;
- statutory audit;

9) Shareholders’ meeting
- Shareholders powers;
- Shareholders/Directors relation;
- procedure;
- listed companies and empty voting;
- one share-one vote rule and its abandonment;
- capital increase and pre-emptive rights of shareholders;
- equal treatment of shareholders;

10) Shareholders’ Right Directives
- Shareholder Primacy

11) Mergers and Divisions
- EU Directives
- Types of mergers and divisions
- Cross-border operations
- Equal treatment of shareholders and squeeze-out

12) The Cross-border Merger Directive

13) Takeover regulation;
- Mandatory bid rule and equity treatment of shareholders
- Breakthrough rule and poison pills
- Passivity rule
- Squeeze-out and sell-out rights

14) Uniform Company Law
- EEIG
- Societas Europaea

Textbook: A. VICARI, European Company Law, De Gruyter, 2021
[Chapters: 1, 2, 3, 5, 6, 8, 9, 10, 12, 13, 14]
OR
N. DE LUCA, European Company Law – Text, Cases and Materials, Cambridge University Press, 2021
[Chapters 1, 2, 3, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16 (except 16.6 and following), 18, 19]


The students are also required to take into account the most recent legislative sources, in particular Directive (UE) 2017/1132.
Some European Court of Justice’s cases will also made available to the students.

Suggested readings (optional):

• L. Enriques, EC company law directives and regulations: how trivial are they?, in University of Pennsylvania journal of economic law, 2006, 1.;
• J. Armour – H. Hansmann – R. Kraakman, The Essential Elements of Corporate Law, available at SSRN: https://ssrn.com/abstract=1436551
• M. Gelter, Centros, the Freedom of Establishment for Companies, and the Court's Accidental Vision for Corporate Law, available at SSRN: https://ssrn.com/abstract=2564765 or http://dx.doi.org/10.2139/ssrn.2564765
• Enriques-Macey, Creditors versus Capital Formation: the case against the European Legal Capital Rules, 2001, available at http://digitalcommons.law.yale.edu
• Miola, Legal Capital and Limited Liability Companies: The European Perspective, in ECFR, 2005.
• G.E. Colombo, International Accounting Principles (IAS/IFRS), Share Capital and Net Worth, ECFR, 2007, 553 ff.;
• Hopt, 2015, Corporate Governance in Europe: A Critical Review of the European Commission's Initiatives on Corporate Law and Corporate Governance, available at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2644156;
• Belcredi, Ferrarini, The European corporate governance framework: issues and perspectives, ECGI Working paper, 2013, at: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2264990
• L. Bebchuck, The Case for increasing Shareholder Power, Discussion Paper No. 500, 12/2004, in Harvard Law Review, Vol. 118, 2005, p. 833-917, at http://www.law.harvard.edu/programs/olin_center/
• J. Schmidt, Cross border mergers, divisions and conversions: accomplishments and deficits of the company law package, in ECFR, 2019,
• Heidenmuller, The Rise and Fall of Regulatory Competition in Corporate Insolvency Law in the European Union, in ECFR, 2019;
• Zhang, Preventive Restructuring Frameworks: A Possible Solution for Financially Distressed Multinational Corporate Groups in the EU, in EBOR, 2019
• Lombardo-Pasotti, The Societas Europaea: a Network Economics Approach, ECFR, 2004

Textbook: N. DE LUCA, European Company Law – Text, Cases and Materials, Cambridge University Press, 2021
[Chapters 1, 2, 3, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16 (except 16.6 and following), 18, 19]
OR
A. VICARI, European Company Law, De Gruyter, 2021
[Chapters: 1, 2, 3, 5, 6, 8, 9, 10, 12, 13, 14]

The students are also required to take into account the most recent legislative sources, in particular Directive (UE) 2017/1132.
Some European Court of Justice’s cases will also made available to the students.

Suggested readings (optional):

• L. Enriques, EC company law directives and regulations: how trivial are they?, in University of Pennsylvania journal of economic law, 2006, 1.;
• J. Armour – H. Hansmann – R. Kraakman, The Essential Elements of Corporate Law, available at SSRN: https://ssrn.com/abstract=1436551
• M. Gelter, Centros, the Freedom of Establishment for Companies, and the Court's Accidental Vision for Corporate Law, available at SSRN: https://ssrn.com/abstract=2564765 or http://dx.doi.org/10.2139/ssrn.2564765
• Enriques-Macey, Creditors versus Capital Formation: the case against the European Legal Capital Rules, 2001, available at http://digitalcommons.law.yale.edu
• Miola, Legal Capital and Limited Liability Companies: The European Perspective, in ECFR, 2005.
• G.E. Colombo, International Accounting Principles (IAS/IFRS), Share Capital and Net Worth, ECFR, 2007, 553 ff.;
• Hopt, 2015, Corporate Governance in Europe: A Critical Review of the European Commission's Initiatives on Corporate Law and Corporate Governance, available at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2644156;
• Belcredi, Ferrarini, The European corporate governance framework: issues and perspectives, ECGI Working paper, 2013, at: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2264990
• L. Bebchuck, The Case for increasing Shareholder Power, Discussion Paper No. 500, 12/2004, in Harvard Law Review, Vol. 118, 2005, p. 833-917, at http://www.law.harvard.edu/programs/olin_center/
• J. Schmidt, Cross border mergers, divisions and conversions: accomplishments and deficits of the company law package, in ECFR, 2019,
• Heidenmuller, The Rise and Fall of Regulatory Competition in Corporate Insolvency Law in the European Union, in ECFR, 2019;
• Zhang, Preventive Restructuring Frameworks: A Possible Solution for Financially Distressed Multinational Corporate Groups in the EU, in EBOR, 2019
• Lombardo-Pasotti, The Societas Europaea: a Network Economics Approach, ECFR, 2004

Teaching will be carried out as frontal lectures (also using telematic instruments for distance courses), aimed at framing the issues in a systematic context, taking into account the connection with European law and the evolution of internal law. During the course legislative, doctrinal and courts material will be provided to the students.
Attendance on a regular basis, although not mandatory, is highly recommended in order to achieve the expected learning outcomes.

During the Covid-19 health emergency, the course is held in "blended" mode, when allowed, or remotely.
Attendance on a regular basis, although not mandatory, is highly recommended in order to achieve the expected learning outcomes.

The final exam consists of a written test. Midterm exams (not mandatory) will take place for students attending the lectures. The written exam may consist in the resolution of some multiple-choice questions, as well as the writing of a short essay on the topics covered in previous lessons, as well as a case study on a ECJ decision.
To pass the exam, it is necessary to achieve a good knowledge of the core subjects of European Company Law. To achieve a higher grading, students are required to show a deep knowledge of the legislative, doctrinal and court subjects and to be able to connect, in a consistent and convincing way, the different issues, offering their own point of view.

- Essential elements of a corporation
- Main cases concerning Freedom of primary establishment

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