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EU companies not craving to acquire a ‘European image’?

Date

26 May 2010

“Societas Europeae (SE) must be a stepping stone towards a European Private Company Statute”, says global accountancy body

ACCA (the Association of Chartered Certified Accountants) welcomes the Commission’s decision to review the Societas Europeae (SE) legislation - especially in the context of further development of a European Private Company Statute (SPE), which should facilitate small and medium-sized enterprises (SMEs)’ business throughout the EU – but notes in its response published today that the legislative proposal should not only focus on the motives of the founders of SEs, but also address the views and concerns of their various stakeholders.

The SE is a legal instrument that gives companies the option of forming a ‘European Company’, which is supposed to operate on a European-wide basis and be governed by Community law directly applicable in all Member States.

Given its apparent lack of success amongst firms operating within the EU, the European Commission has recently launched a Public Consultation on the operation and the impacts of the Statute for a European Company.

For John Davies, ACCA’s head of Business Law, there is room for SE Regulation improvement. “The minimum capital requirement entailed in the SE legislation is too high and should be reassessed. For those states where the domestic requirement is much lower this must amount to a major disincentive” he said.

“The SE can only be formed in prescribed ways and cannot regrettably be formed directly by individuals or companies. This does not help the apparent lack of concern for companies to acquire a ‘European image’”, John Davies added.

“If the original goal for the SE was to make the company primarily subject to EU law with comparatively little left to national law, this has indeed not happened, and has even arguably led to a degree of regulatory arbitrage. The fact that a disproportionate number of SEs have been established in one small country - Luxembourg not to mention it- , appears to bear out this suspicion”, he observed.

ACCA, the global accountancy body, which previously welcomed the Commission initiative to integrate national business registers throughout the EU, considers that ease of access to published information about the financial position and performance of individual SEs is a material concern for existing and prospective investors and creditors.

“It is essential to establish stakeholder confidence in the planned European Private Company and its application to SMEs, John Davies concluded.

- ends -

For further information, please contact:

Cecile Bonino
tel:+32 (0) 2 286 11 37
mob: +44 (0) 7809595008
cecile.bonino@accaglobal.com

Notes to Editors

1. ACCA is the global body for professional accountants. We aim to offer business-relevant, first-choice qualifications to people of application, ability and ambition around the world who seek a rewarding career in accountancy, finance and management. We have 362,000 students and 131,500 members in 170 countries worldwide.
2. ACCA has worked with governments, national organisations and development agencies in emerging economies- for over 20 years- promoting the accounting profession, to create value for the communities, businesses and individuals it serves.
3. ACCA believes that globalisation of business means that one set of reporting standards is essential. We favour the principles-based IFRS.
4. ACCA understands the real issues facing small businesses as 63,000 of our members work in SMEs or small partnerships worldwide.

Cecile Bonino
Public Affairs and Media Relations Officer-EU ACCA
CBI business house
14 rue de la Science
BE-1040 Brussels
tel:+32 (0) 2 286 11 37
mob: +44 (0) 7809595008
http://www.accaglobal.com

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