Thomas Papadopoulos

The Mandatory Provisions of the EU Takeover Bid Directive and Their Deficiencies

The two key provisions of the EU Directive on Takeover bids, the Board Neutrality (Article 9) and the Breakthrough Rule (Article 11), are optional at Member State and individual company level. According to the Directives Reciprocity Rule, a target company that applies the Board Neutrality and/or Breakthrough Rule is able to opt out, if the offeror company does not apply the same Board Neutrality and Breakthrough provisions. Some of the few obligatory substantial provisions of the EU Directive on Takeover Bids are the Mandatory Bid Rule (Article 5), the squeeze-out right (Article 15) and the sell-out right (Article 16). The purpose of these provisions is to protect minority shareholders according to the legal basis of the Directive (Article 44, paragraph 2g EC Treaty). However, the Directive itself provides the possibility to evade the enforcement of these provisions: (i) at the transposition of the Directive into the national law, and (ii) after the implementation stage, when the parties to a bid are obliged to launch a mandatory bid. Additionally, the provisions themselves are characterized by many drawbacks and problems of interpretation, which reveal theirweakness to contribute to the protection of the shareholders and subsequently to the freedom of establishment through takeover bids. Furthermore, the most important mandatory provisions of the Directive are easily avoidable and become de facto optional. If this conclusion is combined with the optionality of the two key provisions and the Reciprocity Rule, the EU Directive will not have any significant effect on the integration of the European Market for Corporate Control, the promotion of cross-border corporate mobility, the protection of shareholders and the protection of freedom of establishment in general. The Directive does not really ‘exist’. This Article will analyse the most important mandatory provisions of the Directive, namely the Mandatory Bid Rule (Article 5), the squeeze-out right (Article 15) and the sell-out right (Article 16).

Acquisition of corporate control and clear criteria in the adjustment of the mandatory bid price

This article discusses the adoption of clear criteria for the adjustment of the bid price in mandatory bids. The analysis takes place in the context of Article 5 of the EU Takeovers Directive which harmonises mandatory bids, the notion of “equitable price” of shares and the adjustment of the mandatory bid price, at the EU level. This article focuses on the ruling of the EFTA Court in the case of Periscopus AS v Oslo Børs ASA and Erik Must AS which analysed corporate control transactions and clear criteria for the adjustment of the mandatory bid price, within the framework of the Takeovers Directive. The EFTA Court sought to interpret and to clarify this adjustment mechanism. The protection of minority shareholders is also scrutinised. Moreover, the importance of EU fundamental freedoms with regard to the adjustment of the mandatory bid price is analysed. A few concluding remarks are deduced.

Reincorporations: a comparison between Greek and Cyprus law

This paper aims to analyse the legal framework of reincorporations and subsequent change of applicable law in Greece and Cyprus. A comparison between Greek Law and Cyprus Law is drawn. This paper highlights possible required reforms. Cyprus has a quite detailed legal framework of voluntary inbound and outbound reincorporations. While Greece has certain provisions on outbound reincorporations, it does not have any provisions on inbound reincorporations. The compatibility of these national provisions with internal market rules, as interpreted by the case law of the Court of Justice of the EU (CJEU), is discussed.,This paper follows a comparative approach. After a careful analysis of each national legal framework, a comparison between Greek law and Cyprus law follows. This paper also follows an EU law approach.,These two jurisdictions present some differences. Cyprus adopting the incorporation theory has a detailed, sophisticated and flexible legal framework of reincorporations. Although Greece adopting the real seat theory has some special provisions for outbound reincorporations, there are no specific provisions for inbound reincorporations. Inbound reincorporations are possible under Greek law, but the absence of detailed provisions is against legal certainty. Cyprus law on reincorporations could be used as an example for Greek legislature. However, possible EU harmonisation of seat transfers is expected to have an immense impact on national provisions for reincorporations.,Reincorporations constitute a significant corporate restructuring technique with important practical implications on the economy. Apart from academics, this paper attracts the interest of lawyers, managers, accountants, officers of supervisory and regulatory bodies and policymakers engaged with reincorporations.,This is one of the few academic papers comparing Greek and Cyprus company law and private international law. It is the first paper that compares the Greek and Cyprus legal framework of reincorporations.