The European Commission has published its proposals for the European Private Company Statute. The European Private Company - or SPE, after its latin name Societas Privata Europaea - will be a new European legal form designed for small and medium sized enterprises. The Statute, which will take the form of a Regulation, will contain a set of uniform company law rules applicable to SPEs across the Member States, including such matters as shareholder rights and creditor protection. With regard to capital protection, the proposal departs from the view that a high minimum level of capital is required to protect creditors. The minimum capital requirement is €1. This reflects the position that it should be easy to from a SPE.
The proposal, in Article 18, provides shareholders with an exit right where the SPE's activities cause them serious harm as a result of several actions including a substantial change in the activities of the SPE or the non payment of a dividend for at least 3 years in circumstances where the SPE's financial position would have permitted such a distribution.
The proposal makes clear that directors' duties are owed to the SPE and Article 31 provides that "[a] director shall have a duty to act in the best interests of the SPE. He shall act with
the care and skill that can reasonably be required in the conduct of the business".
The proposed SPE Regulation will only come into force after unanimous adoption by the Council of Ministers and the approval of the European Parliament. If this happens, the Commission intends that the Regulation will come into force on 1 July 2010.
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