There has been an exponential growth in interest in comparative company law in recent years. For example, in the period from 2002 to 2011, no fewer than ten monographs or edited collections were published exploring this new field of enquiry. The burgeoning literature was mirrored by an increase in University Postgraduate courses or programs in comparative company law and corporate governance. Moreover, the dissolution of trade barriers and mass cross-border capital flows engendered by the forces of competition and globalization have necessitated legal practitioners to be conversant with the company laws of jurisdictions other than their own.
In Mathias Siems and David Cabrelli (eds.), Comparative Company Law: A Case Based Approach, Hart Publishing, 2013 (publisher’s website; introduction on SSRN) we have aimed to fill an important gap in this field. Existing books on comparative company law tend to focus on the institutional structure of the corporation but this approach risks overlooking specific cases and how the issues arising from disputes are resolved in different jurisdictions. For example, topics related to directors’ liability, creditor protection and shareholders’ rights may best be understood by analyzing how selected hypothetical cases would be solved in different countries.
The book covers ten legal systems. With respect to countries of the European Union, it focuses on the most populous countries (Germany, France, UK, Spain, Italy, and Poland) as well as two smaller Member States (Finland and Latvia). In addition, the laws of the world’s largest economies (the US and Japan) are included for the purposes of wider comparison. We owe an immense debt of gratitude to our country experts Pierre-Henri Conac (France), Pablo Iglesias Rodríguez (Spain), Hisaei Chuck Ito (Japan), Theis Klauberg (Latvia), Corrado Malberti (Italy), Lena Nordman (Finland), Gordon Smith (USA), Kamil Szmid (Poland), Marco Ventoruzzo (Italy), Horoyuki Watanabe (Japan) and Michał Zurek (Poland).
The introductory chapter of the book outlines our case-based approach to comparative company law. The subsequent ten chapters deal with various topics of directors’ duties, takeovers, creditor protection and shareholder protection. Each of the country experts performed three tasks. First, he or she drafted one hypothetical case and a solution to that case according to the company law of his or her home jurisdiction. The decision to enable each participant to draft one of the cases was predicated on the perceived need to achieve a good mix and balance of cases, possibly reflecting different socio-economic circumstances. Secondly, each of the country experts then circulated their hypothetical cases and solutions amongst the other country experts and solutions were produced by each of the country experts to the hypothetical cases under the law of his/her home jurisdiction. Thirdly, each country expert examined the different solutions to “his/her hypothetical case” and drew up a comparative chapter conclusion.
In the final chapter of the book on the “Form, Style and Substance in Comparative Company Law” we use the case studies in order to engage in a more general discussion about differences and similarities between legal systems in company law. For this purpose, two topics from each of the ten cases, thus twenty components in total, were coded in terms of legal rules, the underlying legal sources and the actual results. This approach enabled us to quantify similarities and differences, going beyond anecdotal examples. The main findings of this chapter can be summarized as follows:
- First, we do not find Americanization of company laws. Rather, in all three categories the US is the outlier, thus, confirming the counter-view of an American exceptionalism.
- Second, there is some evidence that EU Directives have led to some convergence of company laws. Still, the UK system of company law is a bit of an outlier in terms of the nature of the rules, the sources of those rules and the outcome reached when such rules are applied. Moreover, it is remarkable that even the continental European countries differ considerably, for instance, in the role played by case law and the strength of shareholder protection.
- Third, we are skeptical about the role of legal families. There are some similarities between the UK and US in terms of sources of law, yet, case law also plays an important role in Germany, France and Japan. Moreover, our findings do not confirm the hypothesis that the case law of common law countries is a crucial determinant for their high levels of shareholder protection; rather, if case law has an influence on shareholder protection, this appears to be more pronounced in France and Germany.
- Finally, the harmonization of company laws is often countered by the argument that it can only lead to formal harmonization and that it fails to respond to the need for functionally equivalent legal rules. Our results do not confirm such skepticism as we find a strong positive correlation between the content of legal rules and the actual results.