Simplification of the 1st and 11th Directive

2. Simplification of the 1st and 11th Directive • Proposal for a Directive of the European Parliament and of the Council amending Council Directives 68/151/EEC and 89/666/EEC as regards publication and translation obligations of certain types of companies • 17.4.2008 submitted by EC • negotiations started during SI PRES • CZ PRES took over the negotiations from FR on 1st January 2009

3. Why? • company law directives – adopted between 1960s and 1980s • 1st CLD – adopted in 1968 • progress in information technologies • duplication of information provided by companies

4. Type of action • part of the Action programme for the reduction of the administrative burden – number of proposals submitted as a „fast track“ • company law, accounting and auditing – priority areas in admin. burden initiative • in parallel Commission launched initiative for simplification of the regulatory environment for European businesses (within the general context of Better Regulation)

5. Content – 1st CLD • original version – target: publication requirements for limited liability companies (Art. 3) - commercial registers, national gazettes + - national/regional newspapers (outside the scope of the directive) • amendment 2003 – adaptation to new technologies – since January 2007 possibility to file documents and particulars by electronic means + national gazette can be kept in electronic form/equally effective means

6. publication costs: - incorporation of the company - change to documents/particulars (e.g. annual accounts) - publication requirements included also in other directives/regulations (references used to the disclosure rules in 1st CLD); e.g. SE, SCE, 3rd CLD on mergers, 6th CLD on divisions, 10th CLD on cross-border mergers …

7. New proposal • aim: reduce redundant publication requirements = reduce admin. and financial costs for companies • content: obligatory central electronic platform (information disclosed in chronological order, e.g. registers´website or electronic national gazette) + no special fee for companies as regards publication via CEP or any additional publication obligation imposed by MS • justification: electronic availability = no need for the publication in national gazettes (paper based); national gazettes often contain a reference and not the full information • MS free to continue to provide for additional publication obligations – free of charge for companies • registration fees are kept (recital 6)

8. Impact Assesment • the total minimum costs of current rule to publish in national gazettes – estimated at: • around 410 mil. EUR/year (as regards publication of annual accounts) • around 200 mil. EUR/year (as regards publication of changes in the registers) • internal costs of companies for preparation of the information to be published • in some MS – costs for publication in newspapers (no figures available)

9. Challenges • traditions • internet penetration • earnings

10. 11th CLD • the proposal contains modification of 11th CLD on branches • objective: reduce costs for translation and certification • proposed measures: mutual recognition of translations of certain documents of a branch (e.g. memorandum, articles of association, accounting documents)

11. Thank you for your attention! Martina Nemcova Attaché for Company Law Permanent Representation of the Czech Republic martina_nemcova@mzv.cz Tel. 0032 (0) 221 39 324