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Corporate Mobility in Europe through Primary Outbound Establishment: Challenging the Daily Mail Rule

Author(s): Clement Mifsud Bonnici

Journal: ELSA Malta Law Review
ISSN 2225-210X

Volume: 1;
Start page: 209;
Date: 2011;
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Keywords: Free Movement of Companies | Freedom of Establishment | Corporate Mobility | Cartesio | Daily Mail | Primary Establishment | Secondary Establishment | Cross-border Conversion | Incorporation Theory | Real Seat Theory | Private International Law | EU Company Law

Despite the remarkable jurisprudential development on the part of the Courts of Justice of the European Union on the free movement of companies, the freedom of movement of certain categories of establishment has been somewhat hampered by the adoption and use of very fine and subtle distinctions. This paper attempts to address this present stumbling block lying in the path of unobstructed corporate mobility within the European Union to the detriment of achieving undistorted competition and a functional internal market. This author argues that the root of the problem remains the Court’s stubborn attachment to a particular rule developed in the Daily Mail case which effectively places Member States in a privileged and potentially abusive position with respect to companies emigrating towards other Member States. This paper attempts to challenge the ‘Daily Mail rule’ by arguing in favour of its abandonment and by proposing further liberalisation of alternative routes towards establishment, thus furthering the unhindered exercise of the free movement of companies in the European Union.

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