The lex societatis: developments in European case law

Abstract

Commercial companies are part of the wealth of the European Union. However, the types of companies chosen by partners are mostly national, meaning that national law of a Member State applies to the company's life, from its creation to its "death," as well as to shareholders’ internal relationships and with the company's directors. Likewise, the company's legal capacity and legal liability toward third parties are encompassed within the lex societatis. However, conflict of laws rules under European company law do not exist, so each Member State has the power to establish the connecting factors for determining the law applicable to a company. Would it be advisable to standardize the connecting factor that determines the national law applicable to a company at the European Union level?