European Commission Consultation on the future of European Company Law

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The Quted Cmpanies Alliance 6 Kinghrn Street Lndn EC1A 7HW Tel: +44 20 7600 3745 Fax: +44 20 7600 8288 Web: www.theqca.cm Email: mail@theqca.

1 The Quted Cmpanies Alliance 6 Kinghrn Street Lndn EC1A 7HW Tel: Fax: Web: mail@theqca.cm Internal Market and Services Directrate F, Capital and Cmpanies Eurpean Cmmissin, SPA2 2/85, 1000 Brussels, Belgium markt-cmplaw@ec.eurpa.eu Dear Sirs, Eurpean Cmmissin Cnsultatin n the future f Eurpean Cmpany Law INTRODUCTION The Quted Cmpanies Alliance is a nt-fr-prfit membership rganisatin wrking fr small and mid-cap quted cmpanies. Their individual market capitalisatins tend t be belw 500m. The Quted Cmpanies Alliance is a funder member f EurpeanIssuers, which represents ver 9,000 quted cmpanies in furteen Eurpean cuntries. Our ID number fr the Eurpean Cmmissin s register f interest representatives is RESPONSE We welcme the pprtunity t respnd t this cnsultatin. As an rganisatin that represents small and mid-cap quted cmpanies, we have nly respnded t the questins that we feel are relevant fr these cmpanies. I BACKGROUND INFORMATION 1. Please indicate yur rle fr the purpse f this cnsultatin: (Single chice) Business federatin 2. Please indicate the cuntry where yu are lcated: (Single chice) United Kingdm 3. Please prvide yur cntact infrmatin (name, address and -address) Tim Ward and Kate Jalbert The Quted Cmpanies Alliance 6 Kinghrn St Lndn EC1A 7HW kate.jalbert@theqca.cm 4. Is yur rganisatin registered in the Interest Representative Register? (Single chice) A funder member f EurpeanIssuers A cmpany limited by guarantee registered in England Reg N:

2 Page 2 Yes. II OBJECTIVES OF EUROPEAN COMPANY LAW 5. What shuld be the bjective(s) f EU cmpany law? (Multiple chice) Imprve the envirnment in which Eurpean cmpanies perate, and their mbility in the EU. Additinal cmments: At the mst basic level cmpany law exists t regulate the existence f cmmercial vehicles which have the benefit f limited liability and thrugh which business can be cnducted, prviding the participants in cmmerce with a degree f prtectin against any negative cnsequences f their cmmercial decisin-making. Accrdingly, cmpany law must set the bundaries in which sciety is prepared t tlerate the prtectin f participants in cmmerce at the expensive f ther creditrs. It is nt clear that there is strng justificatin fr thse tlerances t be reviewed and harmnised at an EU wide level. It is als nt within the ambit f cmpany law t prvide detailed emplyee rights and prtectins as there is substantial jurisprudence in this area deriving frm the cntractual nexus between the cmpany, as emplyer, and emplyee. As such, the nly functin fr harmnised cmpany law at an EU level is t imprve the envirnment fr cmpanies invlved in crss brder intra EU trading and peratins. III SCOPE OF EUROPEAN COMPANY LAW 6. Wuld yu supprt that the EU's pririty shuld be t imprve the existing harmnised legal framewrk r, rather, t explre new areas fr harmnisatin? (Single chice) Yes, the fllwing pieces f existing legislatin harmnising cmpany law culd be mdernised further: The Directive n maintenance and alteratin f the capital f public limited-liability cmpanies. 7. Shuld the fcus f EU cmpany law mve away frm the distinctin between public/private twards listed/unlisted in rder t ensure adequate prtectin t sharehlders? (Single chice) Yes, but nly fr legal instruments related t: Maintenance and alteratin f the capital. IV USER-FRIENDLY REGULATORY FRAMEWORK FOR EUROPEAN COMPANY LAW 8. D yu think that cdifying existing EU cmpany law Directives, thus reducing ptential incnsistencies, verlaps r gaps, is an idea wrth pursuing? (Single chice) V EU COMPANY LEGAL FORMS 9. What, if any, is the added value that EU cmpany legal frms bring fr Eurpean business? (Multiple chice)

3 Page What, if any, are the main shrtcmings f EU legislatin intrducing EU cmpany legal frms? (Multiple chice) 11. Shuld existing EU cmpany legal frms be reviewed? (Single chice) 12. Culd ptinal mdels such as the EMCA r similar prjects be a suitable alternative t traditinal harmnisatin? (Single chice) Yes. Please explain (max 500 characters): Yes. Mdels which add t the variety f vehicles available t participants in cmmerce are clearly a gd thing, prvided their use is vluntary. Hwever, we d nt believe that there is a strng base f empirical evidence that such additinal mdels are either required r necessary as part f any effrt t stimulate the EU ecnmy r fcus investment n high grwth SMEs. VI THE PARTICULAR CASE OF THE SOCIETAS PRIVATA EUROPAEA (SPE) STATUTE 13. Shuld the Cmmissin explre alternative means t supprt Eurpean SMEs engaged in crss-brder activities? (Single chice) Other pssibilities t explre? Additinal cmments: We welcme the Cmmissin s Think Small First apprach and its fcus n supprting Eurpean SMEs as the engines f grwth in the EU ecnmy. We believe that, in rder t maximise the ability f SMEs t access market driven crss-brder netwrks f equity listing venues and t increase the liquidity pl fr SMEs, the Cmmissin shuld nt stp shrt f taking a cmplete and hlistic review f the burdens n small and mid-cap quted cmpanies. It shuld examine verall what is apprpriate and beneficial in terms f a regulatry apprach fr primary markets, rather than examining measures in a piecemeal apprach in rder simply t ech the current structure f the Financial Services Actin Plan Directives and ther Directives affecting SMEs. An EU-wide definitin f an SME is badly needed s that varius EU initiatives in this area can be harmnised and streamlined. A cmmn definitin wuld facilitate the creatin f a hlistic regulatry regime fr SMEs and the ability t identify and measure the effectiveness f actins taken. We strngly supprt the Eurpean Cmmissin s prpsal fr specialised SME grwth market in MiFID II as a step twards defining a market fr these cmpanies. In additin, we believe that the Eurpean Cmmissin shuld create an SME asset class (ie cmpanies f a certain size wuld be a member f this asset class ) we are prpsing that this includes SMEs bth n the regulated and MTF markets. This wuld bring attentin t and raise awareness abut small and mid-cap quted cmpanies t attract investment and facilitate funds t invest in these cmpanies. We wuld like t see pensin funds, insurance cmpanies etc. mandated t state publicly what their investment plicy is twards this asset class. This wuld enable cnsumers t decide whether t buy the prducts/invest in pensin funds, insurance cmpanies etc. based n a cnsideratin f whether these entities are actively investing in the engines f Eurpean ecnmic grwth. VII CROSS-BORDER TRANSFER OF A COMPANY'S REGISTERED OFFICE

4 Page Shuld the EU act t facilitate the crss-brder transfer f a cmpany's registered ffice? (Single chice) N, as the existing EU framewrk (Eurpean Cmpany Statute, crss-brder mergers Directive) prvides fr sufficient tls fr a crss-brder transfer f registered ffice. 15. What shuld be the cnditins fr a crss-brder transfer f registered ffice? (Multiple chice) 16. What shuld be the cnsequences f a crss-brder transfer f registered ffice? (Multiple chice) VIII CROSS-BORDER MERGERS 17. D yu supprt further harmnized rules in the Directive? IX CROSS-BORDER DIVISIONS 18. D yu supprt intrducing regulatin regarding crss-brder divisins at EU level? (Single chice) X GROUPS OF COMPANIES 19. D yu see a need fr EU interventin in this field? (Single chice) N, there is n need fr EU interventin. XI CAPITAL REGIME 20. In yur pinin, shuld the Secnd Cmpany Law Directive be reviewed? (Single chice) Yes: Please indicate what shuld be the aim f the review: Alternative use f the balance sheet test and f the slvency test. XII ADDITIONAL COMMENTS 21. D yu wish t uplad a dcument with additinal cmments? Yes If yu wuld like t discuss this in mre detail, we wuld be pleased t attend a meeting. Yurs sincerely, Tim Ward Chief Executive

5 APPENDIX B THE QUOTED COMPANIES ALLIANCE (QCA) A nt-fr-prfit rganisatin funded by its membership, the Quted Cmpanies Alliance represents the interests f small and mid-cap quted cmpanies, their advisrs and investrs. It was funded in 1992, riginally knwn as CISCO. The Quted Cmpanies Alliance is gverned by an elected Executive Cmmittee, and undertakes its wrk thrugh a number f highly fcussed, multi-disciplinary cmmittees and wrking grups f members wh cncentrate n specific areas f cncern, in particular: taxatin legislatin affecting small and mid-cap quted cmpanies crprate gvernance emplyee share schemes trading, settlement and custdy f shares structure and regulatin f stck markets fr small and mid-cap quted cmpanies; plitical liaisn briefing and influencing Westminster and Whitehall, the City and Brussels accunting standards prpsals frm varius standard-setters The Quted Cmpanies Alliance is a funder member f EurpeanIssuers, which represents quted cmpanies in furteen Eurpean cuntries. Quted Cmpanies Alliance s Aims and Objectives The Quted Cmpanies Alliance wrks fr small and mid-cap quted cmpanies in the United Kingdm and Eurpe t prmte and maintain vibrant, healthy and liquid capital markets. Its principal bjectives are: Lbbying the Gvernment, Brussels and ther regulatrs t reduce the csting and time cnsuming burden f regulatin, which falls disprprtinately n smaller quted cmpanies Prmting the smaller quted cmpany sectr and taking steps t increase investr interest and imprve sharehlder liquidity fr cmpanies in it. Educating cmpanies in the sectr abut best practice in areas such as crprate gvernance and investr relatins. Prviding a frum fr small and mid-cap quted cmpany directrs t netwrk and discuss slutins t tpical issues with their peer grup, sectr prfessinals and influential City figures. Small and mid-cap quted cmpanies cntribute cnsiderably t the UK ecnmy: There are apprximately 2,000 small and mid-cap quted cmpanies They represent arund 85% f all quted cmpanies in the UK They emply apprximately 1 millin peple, representing arund 4% f ttal private sectr emplyment Every 5% grwth in the small and mid-cap quted cmpany sectr culd reduce UK unemplyment by a further 50,000 They generate: - crpratin tax payable f 560 millin per annum - incme tax paid f 3 billin per annum - scial security paid (emplyers NIC) f 3 billin per annum - emplyees natinal insurance cntributin paid f 2 billin per annum The tax figures exclude business rates, VAT and ther indirect taxes. Fr mre infrmatin cntact: Tim Ward The Quted Cmpanies Alliance 6 Kinghrn Street Lndn EC1A 7HW

CEIOPS Proposals for a Definition of Cross-Border Provision of Service under the Insurance Mediation Directive ("IMD")

CEIOPS Proposals for a Definition of Cross-Border Provision of Service under the Insurance Mediation Directive (IMD) CEIOPS-DOC-15/07 CEIOPS Prpsals fr a Definitin f Crss-Brder Prvisin f Service under the Insurance Mediatin Directive ("IMD") Purpse T respnd t the EIOPC 1 request t present an extensive analysis f different