European Business Law, the fourth volume in our series, shows how the European authorities simultaneously abolish all restrictions on access to and exercise of economic activities and support the growth of domestic markets, through the harmonization the internal legislation or the enactment of genuinely unified regulations.

European Business Law

Under Article 54 TFEU, companies or firms formed in accordance with the law of a Member State and having their registered office , central administration or principal place of business within the EU are treated in the same way as natural persons who are nationals of Member States . Since it is the registered office of companies that serves as the connecting factor with the legal system of a partic …

Registered office within the Union

Under Article 54 TFEU, companies or firms formed in accordance with the law of a Member State and having their registered office , central administration or principal place of business within the EU are treated in the same way as natural persons who are nationals of Member States . Since it is the registered office of companies that serves as the connecting factor with the legal system of a particular State - like nationality in the case of natural persons - a Member State in which a company establishes itself cannot apply different treatment to that company solely by reason of the fact that its registered office is situated in another Member State . Thus, a host Member State cannot refuse to recognize the legal status of a company formed in accordance with the law of another Member State in which it has its registered office on the ground that the company moved its actual registered office to its territory, unless it is reincorporated under the law of the host Member State , or make the recognition of the civil or legal personality of an association subject to the presence of a member holding the nationality of that State in the administration of that structure or a minimum and majority presence of members of that nationality . 

Unlike natural persons who may have a personal residence distinct from their establishment, legal persons only have a professional residence: their registered office. Therefore, a company which transfers its central management and control to another Member State cannot claim that it retains the form of establishment of the State of origin . In effect, companies are created pursuant to a national legal system. They exist only through the various national laws which determine the incorporation and operation. In the absence of perfect harmonization of national legislation on corporate law, in particular concerning the connecting factor to the national territory, the possibility for a company to transfer its registered office or its actual head office to a Member State other than that of incorporation without losing its legal personality under the law of that State and, in certain circumstances, the rules relating to that transfer are determined by the national legislation of the Member State of incorporation, who may impose restrictions to the transfer outside its territory of the actual head office in order for it to retain its legal personality . In the absence of a uniform European definition of companies able to benefit from the right of establishment according to a unique connecting factor which determines the national law applicable to a company , a Member State has the power to define the connecting factor required of a company if it is to be regarded as incorporated under the national law of that Member State and the possibility not to permit a company governed by its national law to retain that status if the company intends to reorganize itself in another Member State by moving its seat to the territory of the latter . A Member State cannot however either adopt or maintain a regulation which provides for the taxing of added values not realized at the transfer of a company or at the transfer of the registered or actual head office of a company to another Member State without contravening its obligations under Article 49 TFEU . Likewise, Articles 49 and 54 TFEU preclude legislation of a Member State which provides that the transfer of the registered office of a company incorporated under the law of one Member State to the territory of another Member State, for the purposes of its conversion into a company incorporated under the law of the latter Member State, in accordance with the conditions imposed by the legislation of that Member State, is subject to the liquidation of the first company  . 

The freedom of establishment does not concern only the registered office of an undertaking; it is applicable to the transfer of activities of a company from the territory of a Member State to another Member State, irrespective of whether the company in question transfers its registered office and its effective management outside that territory or whether it transfers assets at the time of that transfer . 

On the other hand, the provisions on the freedom of establishment cannot be relied on by a company established in a non-Member State . 

Since the registered office was not adopted by the first signatories of the Rome Treaty, the Council set out in its general programme an additional condition - effective economic link with the Member State concerned - for enjoying the right of setting up a secondary establishment. The courts now considers that the connecting factor between a company and a State results solely from the compliance with the law of incorporation, see Case C-208/00 Überseering [2002] ECR I-9919, LawLex200900001113JBJ.

Paragraph 2 indicates that 'companies or firms' means companies or firms constituted under civil or commercial law, including cooperative societies, and other legal persons governed by public or private law, save for those which are non-profit making.

Case C-106/16 Polbud - Wykonawstwo, Judgment of 25 October 2017, LawLex201700001725JBJ. 

Case C-657/13 Verder LabTec GmbH & Co, Judgment of 21 May 2015, LawLex201500000648JBJ.

Case C-452/04 Fidium Finanz [2006] ECR I-9521, LawLex200900000885JBJ; Case C-415/06 Stahlwerk Ergste Westig [2007] ECR I-151*, Summ. pub.

Case 270/83 Commission v France [1986] ECR 273, LawLex200900001801JBJ.

With the result that the company cannot, in the host Member State, bring legal proceedings to defend its rights, Case C-208/00 Überseering [2002] ECR I-9919, LawLex200900001113JBJ.

Case C-172/98 Commission v Belgium [1999] ECR I-3999, LawLex200700001800JBJ.

Case 81/87 The Queen v Treasury and Commissioners of Inland Revenue, ex parte Daily Mail and General Trust PLC [1988] ECR 5483, LawLex200900002331JBJ; Case C-58-98 Corsten [2000] ECR I-7919, LawLex200700001595JBJ.

Case C-208/00 Überseering [2002] ECR I-9919, LawLex200900001113JBJ.

Case 81/87 The Queen v Treasury and Commissioners of Inland Revenue, ex parte Daily Mail and General Trust PLC [1988] ECR 5483, LawLex200900002331JBJ; Case C-58/98 Corsten [2000] ECR I-7919, LawLex200700001595JBJ.

Case C-210/06 Cartesio [2008] ECR I-9641, LawLex200900001115JBJ.

Case C-301/11 Commission v Netherlands  [2013], not available in English.

European Business Law

79. Registered office within the Union

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Les décisions de justice citées dans ce paragraphe :

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79. Registered office within the Union

Demandez un accès gratuit au contenu exclusif Livv – juristes d’entreprise

Les décisions de justice citées dans ce paragraphe :

Les notions juridiques connexes

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au contenu exclusif Livv – juristes d’entreprise