The Contributors

xix

Part I: A Framework for a Modern Company and Takeover Law in Europe: Common Regulatory Issues

(182)

The Need for a Regulatory Framework

(92)

EU Company Law at the Cross-Roads

(18)

Jaap Winter

Introduction

(1)

The European Company Statute

(3)

The European Court of Justice

(3)

Capital Market Law and Company Law

(3)

Parenthesis: Competition and Harmonization

(1)

A Modern Regulatory Framework for Company Law in Europe

(3)

The Takeover Bids Directive

(2)

Outlook

(2)

An Agenda for Reform: Company and Takeover Law in Europe

(30)

Gerard Hertig

Joseph A. McCahery

Introduction

(2)

Reflections on Regulatory Arbitrage and Competition

(6)

The Proposed EU Company and Takeover Law Reforms

(9)

An Alternative Approach to Corporate Law Reform

(7)

Conclusion

(1)

References

(5)

Trusteeship and Conflicts of Interest in Corporate, Banking and Agency Law: Toward Common Legal Principles for Intermediaries in the Modern Service-Oriented Society

(38)

Klaus J. Hopt

Introduction

(1)

Duties of Loyalty of Corporate Organs Under Special Contracts and of Professional Intermediaries: A Survey

(9)

Sources, Differences, and Common Features of the Duties of Loyalty of Intermediaries

(5)

Common Legal Principles for Treating Conflicts of Interest

(13)

Prevention of Conflicts of Interest, Sanctions, and Enforcement

(6)

Summary

(3)

A Modern Regulatory Framework for Company and Takeover Law in Europe

(6)

Michel Prada

Regulation of Corporate Governance, in Particular Disclosure

(50)

Disclosure and Corporate Governance: An Overview Essay

(20)

Reinier Kraakman

Introduction

(2)

The Governance Functions of Disclosure

(2)

Why Make Disclosure Mandatory?

(2)

What Companies Are Subject to Mandatory Disclosure?

101

(5)

The Enforcement of Disclosure Rules

106

(4)

The Limits of Mandatory Disclosure

110

(5)

Disclosing Disclosure: Europe's Winding Road to Competitive Standards of Publication of Company-Related Information

115

(30)

Hanno Merkt

Introduction

115

(2)

Fundamentals of Disclosure

117

(22)

General Principles of Disclosure

139

(4)

Sanctioning of Disclosure Duties

143

(1)

Conclusion

144

(1)

Modern Company Law-Making

145

(38)

About Techniques of Regulating Companies in the European Union

145

(38)

Eddy Wymeersch

Regulation of Companies and Their Conduct

145

(15)

The Regulation of Companies at the EU Level

160

(9)

Which Way Forward?

169

(13)

Conclusion

182

(1)

Part II: Corporate Governance: Inside the Corporation

183

(356)

Board Structure, in Particular the Role of Non-Executive and Supervisory Directors

185

(82)

Post-Enron Developments in the United Kingdom

185

(40)

Paul Davies

The Enron Issues and the British Response

185

(3)

General Points

188

(5)

Board Structure

193

(13)

Auditor Independence

206

(5)

Executive Remuneration

211

(7)

Analysts' Conflicts of Interest

218

(2)

By Way of Conclusion: The Non-Barking Dog

220

(5)

Corporate Scandals Across the Globe: Regulating the Role of the Director

225

(42)

Jennifer Hill

Introduction

225

(2)

A Tale of Two Australian Corporate Collapses

227

(5)

Board Structure and Composition as a Contemporary Corporate Governance Tool

232

(21)

Director and Officer Liability as an Accountability Mechanism

253

(6)

Executive Remuneration

259

(7)

Conclusion

266

(1)

The Remuneration of Executive and Non-Executive Directors

267

(106)

Executive Remuneration and Corporate Governance in the EU: Convergence, Divergence, and Reform Perspectives

267

(80)

Guido Ferrarini

Niamh Moloney

Theoretical Foundations

268

(52)

Comparative Overview

320

(20)

Reform Perspectives

340

(7)

Accounting for Share-Based Remuneration

347

(26)

Kimberley Crook

Introduction

347

(1)

Overview of the Accounting Issues

348

(4)

U.S. Accounting Requirements

352

(2)

IASB Project

354

(4)

Concluding Comments

358

(1)

Appendix: IASB -- Share-Based Payment

358

(15)

The Responsibility of the Management and of the Board and Its Enforcement

373

(44)

The Responsibility of the Management and Its Enforcement

373

(44)

Holger Fleischer

Introduction

373

(1)

Fiduciary Duties in Different Legal Systems

374

(19)

Duties to Creditors and the Responsibility for Wrongful Trading

393

(10)

Management Responsibility for Financial Statements

403

(5)

Directors' Disqualification

408

(9)

The Role of the Shareholder

417

(38)

The Role of the Shareholder in Internal Corporate Governance: Shareholder Information, Communication and Decision-Making

417

(38)

Eilis Ferran

Introduction

418

(2)

The Development of European Company Law

420

(2)

Shareholder Information

422

(14)

Beyond Disclosure: Active Exercise of Internal Control by Shareholders

436

(18)

A Concluding Observation

454

(1)

The Auditors

455

(84)

Gatekeeper Failure and Reform: The Challenge of Fashioning Relevant Reforms

455

(52)

John C. Coffee, Jr

Introduction

455

(5)

Gatekeepers: Past and Present

460

(20)

The Near Future of Gatekeepers: Sarbanes-Oxley and the Looming Litigation Crisis

480

(9)

The Future Gatekeeper: Remedies for Gatekeeper Failure

489

(16)

Conclusion

505

(2)

Corporate Governance and Auditor Independence: The Battle of the Private Versus the Public Interest

507

(32)

Werner F. Ebke

Introduction

507

(7)

The Role and Position of the Independent Auditor

514

(3)

Auditor Independence

517

(19)

Public Oversight

536

(2)

Conclusions

538

(1)

Part III: Corporate Governance: The Market for Corporate Control and the Level Playing Field

539

(258)

American Experience and EU Perspectives

541

(136)

An American Perspective on Anti-Takeover Laws in the EU: The German Example

541

(20)

Jeffrey N. Gordon

Introduction

542

(3)

Germany and the `Level Playing Field': The Problem of Economic Nationalism

545

(3)

The Different Impact of Anti-Takeover Measures, Germany vs US

548

(8)

Prospects for a Revised 13th Directive?

556

(2)

Conclusion

558

(3)

Why Continental European Takeover Law Matters

561

(14)

Allen Ferrell

Why Worry About Continental European Takeover Regulation?

561

(2)

Interaction Between Technical and Structural Barriers to Takeovers

563

(3)

Standing the Test of Time? Two Case Studies

566

(8)

Conclusion

574

(1)

The Economics of the Proposed European Takeover Directive

575

(72)

Joseph A. McCahery

Luc Renneboog

Peer Ritter

Sascha Haller

Introduction

576

(2)

Corporate Governance and the Cost of Capital

578

(6)

The Pattern of Ownership and Control in Europe

584

(5)

Explanations for Differences in Ownership and Control Concentration Across Companies and Countries

589

(10)

Takeovers in the European Union and the U.S: Evolution

599

(6)

The Determinants of Bidder and Target Returns in the Economic Literature

605

(8)

Takeover Regulation in the European Union

613

(3)

The Market for Corporate Control and Tender Offers

616

(15)

Board Neutrality

631

(4)

Squeeze-Out

635

(9)

The Level Playing Field Considered and Conclusions

644

(3)

Reciprocity in Takeovers

647

(30)

Marco Becht

Introduction

647

(4)

Models of Corporate Control

651

(2)

Achieving Reciprocity

653

(6)

Reciprocity in Takeovers as a Policy Objective

659

(3)

Conclusion

662

(3)

Figures

665

(12)

The Proposed `Break-Through' Rule

677

(60)

Ownership, Takeovers and EU Law: How Contestable Should EU Corporations Be?

677

(34)

John C. Coates IV

The DTB and the BTR

677

(3)

The High-Level Goals of the DTB

680

(2)

Doubts About the BTR

682

(8)

Why Do Takeover-Proof Firms Exist?

690

(12)

Summary

702

(1)

Implications

703

(2)

Alternatives to the BTR: Mandatory Re-Openings

705

(2)

Conclusion

707

(2)

Appendix

709

(2)

Make It or Break It: The Break-Through Rule as a Break-Through for the European Takeover Directive?

711

(26)

Peter O. Mulbert

Introduction

711

(3)

The Break-Through Concept of the High-Level Group

714

(7)

Shareholder Decision-Making

721

(5)

Proportionality

726

(8)

Concluding Remarks

734

(3)

Mandatory Bids, Squeeze-Outs and Similar Transactions

737

(60)

Mandatory Bids, Squeeze-Out, Sell-Out and the Dynamics of the Tender Offer Process

737

(30)

Mike Burkart

Fausto Panunzi

Introduction

737

(7)

Economics of the Tender Offer Process

744

(4)

Mandatory Bid Rule

748

(5)

Squeeze-Out Right

753

(3)

Sell-Out Right

756

(2)

Controlling Owners and Mandatory Bid Rule

758

(4)

Conclusions

762

(1)

References

763

(4)

The Mandatory Bid Rule in the Proposed EC Takeover Directive: Harmonization as Rent-Seeking?

767

(30)

Luca Enriques

Introduction

768

(1)

The Group's Proposals on Mandatory Bid Price, Squeeze-Out and Sell-Out Rights

769

(4)

The Proposal's Provisions on Mandatory Bids and Squeeze-Out and Sell-Out Rights: The Devil Is in the Details

773

(11)

The Uneasy Case for the Proposed EC Mandatory Bid Rule

784

(10)

Conclusions: A Lawyers' and Regulators' Plot?

794

(3)

Annex 1: Commission of the European Communities Modernising Company Law and Enhancing Corporate Governance in the European Union -- A Plan to Move Forward (21 May 2003)

797

(28)

Annex 2: Report of the High Level Group of Company Law Experts on Issues Related to Takeover Bids (10 January 2002)

825

(100)

Annex 3: Report of the High Level Group of Company Law Experts on a Modern Regulatory Framework for Company Law in Europe (4 November 2002)

925

(166)

Cases

1091

(6)

Index