Speech of Commissioner Jourova at the 21st European Company Law and Corporate Governance Conference: Crossing Borders, Digitally in Tallin
...As committed in this year's Work Programme, we are preparing a Company Law package. Its aim is twofold: first, we want to create a digital single market with clear benefits and digital solutions for European businesses, and second, we want to facilitate their cross-border operations.
There are 24 million companies in the EU, and 99% are small and medium sized enterprises. We want to help them flourish and expand, in particular the smaller ones that feel the effects of costs and barriers the most.
When working on this company law package, we must address the following challenges:
- How can we make sure that companies will not abuse the freedom of establishment, as guaranteed by the Treaties?
- How can we address the issue of companies which move across borders for no real economic reasons?
- How should we guarantee that cross-border operations of companies have no negative impact on employees' rights?
- How can we secure the interests of creditors and minority stakeholders?
- And how should we address the challenges of digitalisation, such as identifications of actors, legal certainty and legal security?
We have gathered evidence that clearly supports a need for action – albeit it is a complex task.
- A 2016 consultation showed that the online registration of business activity is the most important one out of ten online procedures for business.
- Between 2008 and 2012 the number of cross-border mergers rose by 173% as a result of the corresponding EU directive.
- In a survey in 2015 companies told us that divisions offer a way for them to change or simplify the structure of their organisation, adapt to market conditions and realise new business opportunities.Yet, only about 100 cross-border divisions occur in the EU every year, because companies cannot do it if there is no reliable legal framework.
- Around 207 million euros could be saved in start-up and merger costs if half a percent of the companies would move within the EU and could use EU rules on cross-border transfer of registered office. The saved money would be better invested in jobs, innovation and growth. But the prospect of these costs deters companies from moving, in particular small ones.
Besides gathering economic evidence, we are collecting the views of stakeholders.
Our broad public consultation closed on 6 August and we are currently analysing the results.
And we would like to hear from you what you consider as the main problems and how you would address them.
Read full speech here.