Topic ! Flashcards
purpose of EU legislation
to help cos reap full benefits of Internal Market
proportionate protection of SH and 3rd parties
Eu subsidiarity and proportionality principles
what are some of the plans withtin the European Union
Action Plan for Company Law and Corporate Governance
Financial Service Action Plan
European Banking AUthority
European Security and Markets Authoriy
what is company law convergence:
to make EU and US market more interchangeable
who might be stakeholders
employees
creditors
the community
the nation etc
what are some of the fundamental assumptions of Corporations
voluntary, private, contractual entities
broad powers to earn profit in any legal way
primary obligation of managment is to the SHs
free transferability
what are some of the inherent tenssions in a corporation
SHs v. Creditors v. Mgmt v. employees
Employee employer relations (safty)
shareholder-shareholder/bondholder
company-customer
company-shareholder
shareholder-creditor
final invester-professional investor (churn v. long termism)
company v community
what are agency problems_
managers v. shareholder
shareholders v.other SHs
minority shareholder v. majority
what does it mean to say that the firm is a nexus for contracts
it is the common counterparty in numerous contracts with SHs, employees and customers
separate assets
entity shilding: assets of the legal entity shileded from creditors of the entity’s owner
two rules of law in the entity shielding
- priority rule. Firm’s assets first, afterwards personal credits of SHs
- liquidation protection. SHs cannot withdraw their share at will
what do entity shielding and limited liability do to protect the firms’ assets and the firms’ owners’ assets
ES: protect firm assets from creditors of firm’s owner
LL: protects the assets of the firms’ owner from claims of the firms creditors
principle of agency
actions of others recognized through entity
respondeat superior
what are the evolved theories regarding corporation
Artificial entity view
siege reel
natural entity theory
aggregate theory and privatization of corporate law
CSR movement
For benefit
Why is Delaware special
General Corporation Law:
- DE bar constantly updating the law for real life problems with DE corporation law in DE legislature
Court of Chancery
- specialized court (corporate background judges)
- incredible compendium of case law
Responsive State Gov’t
- Secretary of State and DE Division of Corporations
consequences
- flexible and modern corporate statutes
- worldwide respected courts
- business-friendly government services
- best US corporate law expertise
three theories of State competition in the US
Race for the Bottom
- create the worst system
Race for the Top
Reace for predicatbility and stability
five elements of Corporate
legal personality
limited liability
transferrable shares
delegated management
investor ownership
