[Ch. 17. RIGHT OF ESTABLISHMENT AND RIGHT TO PROVIDE SERVICES]

C. Case Law on the Right of Establishment for Business Firms

1. Application of Non-Discrimination Rules

• COMMISSION V. ITALY, p. 692 (1988): does freedom of establishment include the right to non-discriminatory treatment in respect of access to (personal) housing, including financing?
• Council "general programs" for implementation of the right of establishment and freedom to provide services include
• right to purchase, exploit and transfer real estate and other property for business purposes
• right to obtain loans for this purpose
• can unavailability of housing constitute an obstacle to free movement of self-employed persons?
• for purposes of establishment?
• for purposes of providing services?
• does the "official authority" exception of art. 45 (ex 55) apply to a nationality restriction on the operation of private music and dancing schools? Commission v. Greece, n. 3 p. 693 (1988)
• does MS law which limits eligibility of elderly-care facilities for welfare subsidy to non-profit enterprises violate art. 43 (ex 52)? Sodemare, n. 4 p. 693 (1997)
 
2. Establishment Rights of Corporations and Shareholders
• FACTORTAME II, p. 694 (1991): nationality restrictions on ownership of a UK-registered ship (UK national, or UK corp. 75% owned & controlled by UK nationals)
• can a MS decide on the basis of nationality of origin, who can become a citizen?
• can it also decide on the basis of the nationality of their owners what ships can acquire its nationality? What is the difference between the issues?
• How does this case implicate the right of establishment under EC law?
• LEWIS V. BT INVESTMENT MANAGERS, p. 697 (US 1980). Prohibition against out-of-state banking companies from providing investment banking services through a local branch or subsidiary.
• Any room for argument about the conclusion?
• would the ECJ reach a different conclusion?
• CENTROS V. ERHVERVS-OG, p. 698 (1999). Where a Danish corporation requires minimum paid-in capitalization, can an other-MS corporation which doesn't satisfy that requirement just establish a branch rather than a subsidiary, and evade the requirement?
• does it matter whether the corporation has ever done any business in its home country?
• does it matter that the incorporators are themselves Danes intending only to do business in Denmark?
• what would constitute abuse of the right of establishment, justifying its denial?
• Daily Mail Plc, n. 2 p. 701 (1988): restrictions imposed by taxing authority on a UK company's right to transfer its registered head office to another MS without ceasing to be a UK company
• are rules governing dis-establishment and re-establishment in another MS within the scope of art. 43 (ex 52)?
• are conditions attached to maintaining UK-company status while moving operations to another MS covered?
• are differences in MS requirements for obtaining domestic-company status inconsistent with ex art. 52? (registered office, operating head office)
• are differences in MS requirements for maintaining that status inconsistent with ex art. 52?
 
D. Company Law Harmonization
• Two principal forms of company, each with separate regulatory statutes, in MS law
• Current EC directives
• First on commercial register
• DAIHATSU HANDLER V. DAIHATSU DEUTSCHLAND, p. 704 (1997)
• COMMISSION V. GERMANY, p. 706 (1998)
• Second on capital structure
• Minimum capitalization
• Prohibition against treasury shares
• Prohibition against voting of subsidiary-owned shares of parent
• Requirement of preemptive rights (cf. U.S. position)
• SIEMENS V. NOLD, p. 707 (1996)
• PAFITIS V. TRAPEZA KENTRIKIS ELLADOS, p. 708 (1996)
• Third on mergers
• Fourth on accounting procedures
• Proposals for Community Legislation
• Fifth on internal structure: worker participation in management!
• Two boards of directors
• Workers proportionately represented in Supervisory Board
• European Company
• Thirteenth on Takeovers