The European Commission has adopted a proposal for a temporary and targeted derogation from the rules governing “European Companies (SEs)” and the European Cooperative Society (SCEs).
A “European Company” is a type of public limited-liability company, whose status allows to run its business in different European countries using a single set of rules. However, the confinement and social distancing measures applying in the EU make it difficult for SEs and SCEs to organise their general meetings within six months of the end of their financial year, as it is legally required.
The temporary derogation from EU rules concerning the general meeting will allow SEs and the SCEs to hold their general meetings within twelve months of the end of the financial year, but no later than 31 December 2020.
Didier Reynders, Commissioner for Justice, and Thierry Breton, Commissioner for Internal Market, said: “We are fully aware of the challenges and the pressure companies across the EU are facing due to the coronavirus pandemic. Extraordinary times call for extraordinary actions.
Member States have granted national companies a temporary extension of the time limits to organise their general meetings. We must bear in mind that European Companies and the European Cooperative Societies face similar organisational difficulties. This is why the Commission proposed temporary derogation to help them live up to their legal obligations and weather this acute crisis.”
Holding general meetings is critical to ensure that legally required or economically necessary decisions for the company or the cooperative society, shareholders, members and third parties are taken in due time.
Given the urgency, this Commission’s proposal for Council Regulation will require swift adoption by the Council after the consent of the European Parliament in order to become law, and provide legal certainty as regards the fulfilment of the SEs and SCEs’ obligations.
Sonya Gospodinova –