European Company and Financial Law Review

Published by De Gruyter

Volume 19 Issue 2

Issue of European Company and Financial Law Review

Contents
Journal Overview

Frontmatter

Publicly Available June 22, 2022

Frontmatter

Page range: I-II

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June 22, 2022

Regulation of Shareholder Exits in Closely Held Companies – Reflections from Sweden

Hanna Almlöf

Page range: 175-202

Abstract

The success of closely held companies largely depends on a well-functioning collaboration between the shareholders. Split ambitions, differenced targets and conflicts among owners can create a need to end the collaboration. The owners need a plan for a structural business partner divorce, i. e., regulation of shareholder exits. This study analyze full and partial shareholder exits with the aid of an interview study with eighteen legal advisors. Through a grounded approach to analysis, and with aid of the Nvivo software, different exit situations are identified and categorized. Exit strategies can be regulated in shareholders’ agreements, in the articles of association, or by legislation. The later alternative, correctly constructed, could reduce transactions costs for the shareholders, as the legislation can serve as a standard contract. This study assesses to what extent the Swedish Companies Act functions as a standard contract for closely held firms on the topic of exit regulation. The study reveals that the Swedish Companies Act is of little help. Instead, the cost of contracting to regulate exits in shareholders’ agreements is placed on the parties. This calls for legislative change.

June 22, 2022

Mandatory Dematerialization of Shares in Polish Private Companies: A Missed Opportunity to Do Things Right

Jacek Dybiński, Anne-Marie Weber

Page range: 203-238

Abstract

On 1 March 2021, Polish company law underwent a profound change when the reform introducing the mandatory dematerialization of shares in non-listed companies entered into force. On that day, share certificates became ex lege invalid and were replaced by entries into electronic share registers or securities accounts held by investment firms. With this step, the legislator dealt the nearly-final blow to document securities in Poland, given that the publicly-traded shares have already been subject to dematerialization since 1997 and most of other securities, both listed and non-listed, followed suit in recent years. Like in various jurisdictions which had gone through this process before, the Polish legislator had several options regarding the electronic securities regulation. The article analyses the essential features of the reform and puts it in a broader, comparative context. It also aims to assess whether the new law responds to theoretical and practical challenges inherent to electronic securities in times of innovative financial technologies and fast-changing legislation. The authors argue that an electronically registered share is de facto a new type of a dematerialized security that the reform added to the current catalogue, but its normative design is incomplete and far from what should be expected given the importance of its regulation in company law.

June 22, 2022

Regulatory Barriers to Corporate Restructuring Through Disposition of Major Assets – A Serbian Perspective*

Mirjana Radović, Vuk Radović

Page range: 239-271

Abstract

This article contains a critical analysis of the existing Serbian legal provisions that limit the possibility of a major asset disposition as a way of restructuring companies. In this regard, the authors have identified three main problems affecting such asset deals in Serbia, which can be considered regulatory barriers to this type of restructuring. The three problems are: the specific regulation of necessary shareholder approval and appraisal rights, the unavoidable assumption of liabilities by the purchaser (the buyer or the transferee) and the inadequate implementation of the EU Transfer of Undertakings Directive concerning employee protection. The solutions adopted in Serbian law are analyzed using a comparative approach, especially based on the rules adopted in Europe, including South-East Europe and the U. S. as a reference. It is interesting to show how different influences from these other jurisdictions have led to the specific (unique) development of the Serbian regulation with regard to dispositions of major assets. The ultimate goal of the present article is to examine the possibility and the need for harmonization of these issues on the regional (supranational) level.

June 22, 2022

Robo-Advice as a Digital Finance Platform

Fernando Zunzunegui

Page range: 272-304

Abstract

This paper is about automated financial advice, known as Robo-Advice. Its origin and development are analysed as a prominent Fintech activity. After tackling its legal nature as a service platform and showing how it is different from traditional human advice, its legal framework is addressed, particularly in the European Union, to conclude with some legislative policy proposalsto regulate it as a digital finance platform .

Open Access June 22, 2022

Approaching the Danske Bank Scandal in a “Tragedy of the Commons” Perspective: Implications for Anti-Money Laundering Institutional Design and Regulatory Reforms in Europe

Andrea Minto, Niels Skovmand Rasmussen

Page range: 305-338

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Abstract

Policy- and law-makers worry increasingly about how recent money laundering scandals unfolded. There is widespread confusion, though, about what went wrong – “the failures” – and uncertainty as to how to control and cope with them. This article offers a conceptual framework and legal analysis for examining the underpinning “failures”, what causes them, and how, if at all, those failures interact with each other. In doing so, it disentangles three layers, namely “corporate failure”, “supervisory failure”, and “political failure”. Historically, scholars have tended to think of each of those failures separately. However, we believe that a greater focus should be devoted to whether and how the three failures exhibit interactions and even feed on one another. This holistic perspective reveals that scandals such as the one in Danske Bank might result from a type of “tragedy of the commons” in which each layer – corporate, supervisory, and political – generate significant asymmetries of information between parties and actors, exacerbating the agency problems which pervade financial markets. The article will apply Elinor Ostrom’s IAD (Institutional Analysis and Development) framework as to account for the complexity and interconnection in financial markets. Such framework is used to examine the recent developments in policy- and law-making in European anti-money laundering legislation. Not only does the IAD framework explain how the supervisor failure escalated and spilled over but it also sheds new light on why it happened. Together these insights are critical in a legal policy evaluation as they allow scholars to look pass the mere effects of the supervisory failure and focus diligently on the underlying causes. From a purely methodological perspective, it thus demonstrates the added value of incorporating an institutional analysis in doctrinal legal research.

About this journal

Please note the press release of the editors of May 27, 2021 in Supplementary Materials

In legislation and in case law, European Union law has become a steadily more dominant factor in determining national company laws as well as financial markets and banking law of the member states. However, national law also continues to play a major role in several fields. Such developments are sometimes of high academic interest in other European jurisdictions.

However, the discussion of these European and national developments is still to a great extent restricted to the national communities of experts and is done in their national language. Therefore, there is still a strong publication and language barrier in Europe. ECFR intends to change this situation by being one of the leading European academic platforms for debate across Europe on drafting and application of European and comparative company and financial markets law. It aims at universities, lawmakers on both the European and national levels, courts, lawyers, banks and other financial service institutions, in house counsel, accountants and notaries who draft or work with European company and financial law.

The journal focuses on all areas of European and national company law and of the financing of companies and business entities. This includes the law of capital markets as well as the law of accounting and auditing and company law-related issues of insolvency law. Banking law is also treated through specific articles as part of financial markets law. Finally, ECFR serves as a platform for the discussion of theoretical questions such as economic analysis of company law. It consists of articles and case notes on both decisions of the European courts as well as of national courts insofar as they are of interest from a comparative perspective. This does not, of course, exclude contributions from other parts of the world which may also be of interest for European readers.

Based on an initiative by the editors of Zeitschrift für Unternehmens- und Gesellschaftsrecht (ZGR), ECFR soon gained the support of many sister journals all of them leading company and financial markets law journals in their respective jurisdictions. Thus, ECFR as a European platform for academic exchange is currently edited by the editors of ZGR in co-operation with Ondernemingsrecht, Revista de Derecho de Sociedades, Revue des sociétés, Rivista delle società, and the Revue pratique des sociétés - Tijdschrift voor rechtspersoon en vennootschap.

Annual conference

ECFR holds an annual conference on recent topics of European company and financial law. The annual conference 2019 took place in Cracow (Poland) on 27 September 2019. Academic presentations, amongst other topics, dealt with the European directive on preventive restructuring, with the implications of Brexit and with recent national company law reforms in Belgium and Poland. For further inquiries please contact the editorial board (ecfr@jura.uni-wuerzburg.de).