Company Law Across Europe Adapts to the EmergencyMARCO VENTORUZZO IS THE EDITOR OF TWO JOURNALS MONITORING THE CHANGES TAKING PLACE IN A PERIOD THAT IS TRANSLATING INTO AN UNPRECEDENTED LEGAL EXPERIMENT
In Europe, company, financial and bankruptcy law are all reacting to the COVID-19 pandemic and the lockdown that has forced half the continent to stay at home. Marco Ventoruzzo, as Editor of the European Company and Financial Law Review and the Rivista delle società (in the latter with Bocconi colleagues Piergaetano Marchetti, Federico Ghezzi and Giovanni Strampelli), is working on designing a comparative picture, which maps and interprets the changes.
“European countries are proceeding in a not fully coordinated way but in similar directions,” says the scholar, Head of the Department of Legal Studies at Bocconi, “in introducing special measures to contain the economic effects of the pandemic and the practical complications imposed by the lockdown.”
Some changes are aimed at preventing a potentially temporary crisis, caused by an exogenous shock, from causing insolvencies and a chain of liquidations, for example by suspending the “recapitalize or liquidate” rule when capital falls below the legal minimum. The workings of governing bodies have been simplified everywhere, facilitating, for example, virtual shareholder meetings. Finally, efforts are being made to avoid speculative activities on the financial markets by banning short-selling and strengthening the public golden power to avoid hostile takeovers in strategic sectors.
“Since there has been a lack of European direction,” explains Professor Ventoruzzo, “some disorder, if not some form of competition between the systems, could follow. In a way, what we are witnessing is an unprecedented legal experiment, which will allow measures to be tested that have been discussed for some time (such as the usefulness of a minimum share capital), but which would hardly have been introduced without the urgency imposed by the pandemic and its economic consequences.”
While the Rivista delle società will focus on Italian novelties, albeit with its traditional comparative approach, the contributions collected by the European Company and Financial Law Review analytically cover the main European systems. “We have already observed,” concludes Professor Ventoruzzo, “that no country is an exception with respect to the problems to be tackled with the new rules, but timing is variable, depending on when containment measures were taken, and technical solutions are not identical, due also to the difference in starting conditions.”
by Fabio Todesco