After more than three decades of disagreements, the European Union (EU) Council of Ministers finally adopted on 8 October 2001 the Regulation to establish a European Company Statute and its related Directive concerning employee involvement in European Companies. The formal adoption of the two amended texts is the result of the political agreement reached by the EU Council at the Nice Summit in France held in December 2000. The legislation is due to enter into force in 2004.
The European Company or ‘Societas Europaea’ (SE) represents a “major breakthrough” for companies operating within several EU Member States. Until now, such companies had to establish a whole net of subsidiaries throughout the territories in which they operate. Due to disparities between national legislations and the necessity of incorporating at least one legal entity for each country, crossborder operations have proved to be especially costly and time-consuming. Under the new SE Regulation, companies will have the option of setting up a single company under European law with a single set of rules and unified management and reporting systems.