Law 5110 Quiz: SE and SUP Societas Europea
SE and SUP
• European Economic interest grouping (EEIC)
o This group aims at enabling cooperation between enterprises from different
member states
• Societas Europea (SE)
o Created in 2001
o Aims to facilitate restructuring of companies at an EU level
• European private company
o Proposed in 2008, but withdrawn in 2014
o Was replaced with a proposal for a directive for a single-member private limited
liability company the Societas Unius personae (SUP)
• Primary establishment – where a company wishes to relocate to another member state
• Secondary establishment – where a company wishes to set up a subsidiary or branch in
another member state
• Two doctrines of PIL regarding establishment
o Incorporation theory: a company registered in one member state shall be
recognised in its host
o Siege Réel (real seat): recognition is dependent upon a company conforming to
the requirements of the host
Company migration
• Article 49 and 54 TFEU
o Restrictions on freedom of establishment are prohibited
o This includes setting up firms, as well as the establishing of agencies, branches or
subsidiaries
• Cross-border company migration
o Types:
▪ Setting up a company in another MS
• Possible under Article 49 and 54
▪ Setting up a subsidiary/branch in another MS
• Possible under Article 49 and 54 TFEU
• 11th Company law directive on setting up branches
• Centros ECJ - inbound
o Danish entrepreneurs set up a company in the UK, wanted
to register a branch in Denmark
o The setup was refused because it was argued they just
wanted to avoid capital requirements in Denmark
o ECJ:
▪ The refusal is contrary to Article 49 + 54, the choice
for the least restrictive jurisdiction is not an abuse,
but authorities can introduce measures to avoid
fraud (The last bit established in Gephard) as long
as the rule is:
• Non-discriminatory
• In public interest
• Suitable
• Proportional
• Inspire Art – ECJ – inbound
o A company had their headquarters in the Netherlands but
registered in the UK to avoid capital requirements, they had
no business activities in the UK, and operated in the
Netherlands
o The Dutch registry refused to register them unless they
complied with special requirements within their foreign
company law
o ECJ:
▪ It is contrary to Article 49 + 54 TFEU to impose
extra conditions with respect to minimum capital
and director’s liability,
▪ Moving headquarters
• Daily Mail – outbound
o For tax reasons, a company moved its headquarters to the
Netherlands from the UK
o The UK treasury department refused permission
o ECJ: this is not contrary to Article 49 and 54 TFEU –
companies are creatures of national law and should abide
by its rules.
o However, they ruled because each country adopted by the
incorporation theory, they should facilitate the move
• Uberseering – inbound
o A Dutch company had its shares transferred to German
businessmen, it had its seat there without being
incorporated as a legal person
o The Dutch company started court proceedings against the
German company, it was ruled that had no standing
o ECJ:
▪ If a company is established in an MS, it has
freedom of establishment
▪ The host has to recognise legal capacity and
capacity to be party to legal proceedings
• Cartesio – Outbound
o Hungarian LLP planned to move to Italy, this was refused
o ECJ:
▪ Outbound transfer doesn’t fall within Articles 49+
54
▪ Moving the registered office
• Maintaining business but changing applicable law
• This was proposed within the 14th directive
• Polbud – ECJ - outbound
Document Summary
Netherlands: the dutch registry refused to register them unless they complied with special requirements within their foreign company law, ecj: German company, it was ruled that had no standing: ecj: Inbound migration where a company moves into the host state: outbound migration where a company moves out of a country. Cannot refuse to recognise an incoming company, even where a branch registered in another state is used as a primary place of business. Where a company has moved to state b according to its law from state a, it must recognise legal capacity. Where a company goes to ms b for whatever reason and carries out their business there, it cannot impose conditions relating to minimum capital and director"s liability for whatever reason. Where a company wishes to move its central administration elsewhere whilst remaining registered in its original state, the ms cannot refuse this. A member state cannot refuse a company from moving its seat into their country.
