• Corpus ID: 40283272

Creditors versus Capital Formation: The Case Against the European Legal Capital Rules

  title={Creditors versus Capital Formation: The Case Against the European Legal Capital Rules},
  author={Luca Enriques and Jonathan R. Macey},
  journal={Cornell Law Review},
This article presents a critical economic analysis of the European Union's legal capital rules as codified by the Second Directive. Professors Enriques and Macey explore the fundamental differences between United States and European Union approaches to the conflict between fixed and equity claimants and argue that the European Union should abandon its inefficient approach. The costs associated with the European legal capital rules - particularly costs to shareholders, creditors, and society as… 

Legal Capital: An Outdated Concept?

This paper reviews the case for and against mandatory legal capital rules. It is argued that legal capital is no longer an appropriate means of safeguarding creditors’ interests. This is most clearly

Accounting Standards and Legal Capital in EU Law

This paper examines the interaction between accounting standards and legal capital in the European Union legal framework. More in particular, it attempts to compare on a parallel basis the

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Legal capital rules have traditionally been among the cornerstones of European Union Company Law. This led to the early promulgation of the Second (“Capital”) Directive concerning the formation and

Effective Protection of Creditors’ Interests in Private Companies: Obligatory Minimum Capital Rules Versus Contractual and Other Ex Post Mechanisms

This article reveals arguments for and against the initial minimum capital of private companies. It explains that the initial minimum capital rule, which was entrenched in the Second Company

The role of legal capital rules in creditor protection: Contrasting the demands of western market economies with Ukraine's transitional economy.

Rules regulating a company's capital (legal capital rules) have traditionally been considered a creditor protection mechanism. More recently, however, commentators have suggested that legal capital

Choice of Jurisdiction in European Corporate Law — Perspectives of European Corporate Governance

This article addresses the question what will be the impact of the recently admitted choice of corporate law in Europe and how regulators can and should react.Drawing on the empirical evidence and

The Structure of Regulatory Competition in European Corporate Law

In its opinions in the cases Centros, Überseering and Inspire Art, the ECJ has begun to open European corporate law for regulatory competition, as it has been discussed in the US for several decades.

The Myth of the Optimal Capital Structure and the Dogma of Creditor Protection

This paper aims to reassess the dogma of creditor protection in light of the corporate finance principles and theories. To this end, I set forth two methodological premises to reach a substantive

A Synthetic View of Different Concepts of Creditor Protection, or: A High-Level Framework for Corporate Creditor Protection

Protection of corporate creditors has become an important topic within the European Union. At EU level, discussion has been sparked by widespread dissatisfaction with some very rigid and cumbersome

Capital Maintenance in the EU: Is the Second Company Law Directive Really That Restrictive?

This contribution sets out to establish whether, and if so to what extent, the Second Company Law Directive allows the EU Member States to introduce different means of creditor protection, as



Miller , Dos KapitaLSolvency Regulation of tie American Business Enterprise , in CnicAco LFcruizrs IN Lxw x

  • 1999

See discussion supra Part IlI

    FERRAN, supra note 50, at 285; see also KOBLER, supra note 37

      Miller , Dos KapitaL - Solvency Regulation of tie American Business Enterprise , in CnicAco LFcruizrs IN Lxw x