|Author (Corporate)||European Commission|
|Series Details||COM (2018) 241|
Legislative proposal published by the European Commission in April 2018 setting out common procedures at EU level on how a company can move one Member State to another, merge or divide into two or more new entities across borders.
In October 2017, the Court of Justice of the European Union clarified in a judgement (Case C-106/16) that freedom of establishment includes the right for a company to convert itself into a company governed by the law of another Member States, provided the requirements of the Member State of destination for incorporation are satisfied (cross-border conversion).
The proposal was adopted in line with the CJEU judgement. The draft law sets out a simplified procedure for companies to move their seat from one Member State to another. The new rules on cross-border conversions and divisions also include specific measures to help national authorities fight against abuse.
The Commission adopted the proposal on 25 April 2018 as part of a legislative package reforming EU company law. The European Parliament's plenary session adopted a negotiating position on 17 January 2019. The ambassadors from Member States adopted a general approach on behalf of the Council of the European Union on 30 January. An informal agreement between the co-legislators on a compromise text was reached on 13 March. The Parliament formally endorsed it on 18 April, followed by the Council on 18 November 2019.
|Subject Categories||Internal Markets, Law|
|Subject Tags||Company | Corporate Law, EU Four Freedoms|
|Keywords||Free Movement of Services
|International Organisations||European Union [EU]|