Establishment of Companies

Question 1

Factortame

Answer 1

Companies enjoy similar rights to freedom of establishment as individuals

The Court of justice held that requirements in the Merchant Shipping Act 1988 breached Article 49 by requiring the majority of shareholders in a company owning UK ships to be British. This requirement applied irrespective of whether the shareholder was a person or another company

Question 2

Serger

Answer 2

The rights of a company to set up agencies, branches and subsidiaries

ECJ made it clear that this is even so if the company conducts no business in the state where it was incorporated and conducts its businesses through agencies, branches or subsidiaries in other members states

Question 3

Centros

Answer 3

Danish nationals set up a company in the UK (which has more lenient rules compared to Denmark). They then wanted to set up a branch in Denmark but was rejected.

ECJ: this was a breach of article 49

Question 4

Uberseeing

Answer 4

A company incorporated in a member state (Netherlands in this case) - other MS (Germany) must recognise the company’s legal capacity

Question 5

Inspire Art

Answer 5

A Dutch law was held to breach article 49 to require foreign companies that has established a subsidiary in the Netherlands that their capital requirements in Netherlands has to be in accordance with the minimum in the Netherlands