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

Abstract

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 provisions, and even with the whole concept of the Second Company Law Directive. At EU Member State level, three landmark decisions by the European Court of Justice — Centros, Uberseering, and Inspire Art — opened the way for an all-out competition between the different company forms provided for by national company laws. At both levels, albeit for different reasons, British company law — and in particular the absence of any legal capital in the private limited company — acts as the main driving force putting pressure on the concept of legal capital as enshrined in the Second Directive, which in turn was modeled on German company law notions.