CONSULTATION ON A POSSIBLE STATUTE FOR A EUROPEAN FOUNDATION. Consultation by the Services of the Internal Market Directorate General

Transcription

1 EUROPEAN COMMISSION Internal Market and Services DG MARKT/ CONSULTATION ON A POSSIBLE STATUTE FOR A EUROPEAN FOUNDATION Consultation by the Services of the Internal Market Directorate General Commission européenne, B-1049 Bruxelles / Europese Commissie, B-1049 Brussel - Belgium. Telephone: (32-2)

2 CONSULTATION ON A POSSIBLE STATUTE FOR A EUROPEAN FOUNDATION Consultation document of the Services of the Internal Market Directorate General Preliminary Remark The following document has been drafted by the Services of the Internal Market Directorate General in order to assess the need for a European Foundation. It does not reflect the views of the European Commission and will not prejudice its future decisions, if any, on further measures concerning the European Foundation. 2

3 1. INTRODUCTION In its Action Plan of 2003 on Modernising Company Law and Enhancing Corporate Governance in the EU 1, the Commission foresaw, as a medium term priority, the assessment of the need for the creation of a statute for a European Foundation. A public consultation and hearing on future priorities for the Action Plan was carried out in spring demonstrating a need for further work in this area. In addition the European Parliament invited the Commission to continue its preparation of Community legislation providing for legal forms of entrepreneurial organisation, such as the European Foundation 3. The Commission consequently undertook to launch a study aimed at an indepth assessment of the feasibility of such a statute. Following an open tender, a feasibility study was commissioned by the Commission in November 2007, to be carried out jointly by the Max Planck Institute for Comparative and International Private Law in Hamburg and the University of Heidelberg. The Commission has taken no decision as to the need for a European Foundation Statute or the content or structure of a possible statute. If a European Foundation Statute were to be proposed, the objective would be similar to that sought with other European legal forms, i.e. to make possible the use of a single legal form instead of up to 27 national ones. The European Foundation would be parallel to the national legal forms and its use would be optional. In order to assess these issues better, the Services of DG Internal Market have decided to make the feasibility study public on its website and simultaneously to launch a specific related public consultation. The purpose of the consultation is twofold: to get feedback on the feasibility study itself and on the need for a European Foundation Statute, and to get more in-depth information on the operational problems that foundations face when operating cross-border. The responses will be taken into account in assessing the need for and impact of a new legal form. There are two parts to the questionnaire. Part I contains general questions about the need for and desirability of a new legal form, together with questions about the content of a possible European Foundation Statute. It also contains questions targeted specifically at foundations, aimed at getting concrete information about difficulties and hindrances foundations face in the Internal Market, as well as about their interest in a possible statute. Part II is targeted at donors to, and founders of, foundations and aims at obtaining information on how a potential European Foundation Statute might affect founders' and donors' attitudes. Where appropriate the questions refer to the relevant pages of the feasibility study. 1 European Commission» Internal Market» Company Law» Modernisation of Company Law and Enhancement of Corporate Governance 2 European Commission» Internal Market» Company Law» Consultation on future priorities for the Action Plan 3 3

4 . The Commission Services are aware that many foundations have already answered the survey which was included in the feasibility study. Careful consideration has therefore been given to ensuring that responses supplement rather than duplicate the information already provided by foundations through the feasibility study. Responses to this consultation should be concise, focused specifically on the questions raised and sent no later than 15 May The answers to Part I of the questionnaire (to be found below) should be sent to DG Internal Market and Services, Unit F2, European Commission, B-1049 Brussels. Responses may also be sent by to: markt-consultation-ef@ec.europa.eu Part II of the questionnaire, which is targeted at donors and founders takes the form of an online questionnaire. Respondents to this part are kindly asked to note that the responses cannot be saved before submitting them and that the time allowed for answering is 90 minutes. Link to the questionnaire, Part II. 4

5 2. THE QUESTIONNAIRE, PART I Information about the respondent A. Name of the foundation/company/organisation/person and your function Oceana Foundation Concha Martínez Fundraising Director in Europe B. Address and register ID number of registered organisations 4 Fundación Oceana Leganitos, 47, 6º Madrid (Spain) The Oceana Foundation was registered with the number in the Spanish Ministry of Environment in November C. The legal form, field of activity and country of origin of your organisation Oceana is a foundation in Spain, however in other countries in which we operate, such as UK, USA and Chile we have other legal forms. Oceana is an international non-profit marine conservation organisation. We have offices in Europe (Madrid-Spain and Brussels-Belgium), United States (Washington DC, New York and Juneau-Alaska) and in South America (Santiago de Chile). Oceana focuses on the protection and conservation of marine species and habitats and promotes campaigns to eliminate destructive and/or fishing practices to protect vulnerable marine biodiversity. The European section of Oceana carries out in the water research to identify new possible marine protected areas, habitats or species. We also work denouncing illegal practices of fishing boats. Oceana was created in United States in At the end of 2003 Oceana started working in Spain under the legal form or an Association and in 2004 we changed into the Foundation legal figure. D. If you are answering for a foundation Yes. 1. Does your foundation conduct cross-border activities in the EU/EEA area? 4 The Commission asks organisations who wish to submit comments in the context of public consultations to provide the Commission and the public at large with information about whom and what they represent. If an organisation decides not to provide this information, it is the Commission's stated policy to list the contribution as part of the individual contributions. (Consultation Standards, see COM (2002) 704, and Communication on ETI Follow-up, see COM (2007) 127 of 21/03/2007) 5

6 If yes, in which form does your foundation conduct these activities (e.g. foreign foundations, branches, subsidiaries, provision of services, export/direct sales of goods, fund raising, grant making)? The European section of Oceana has an office in Brussels (Belgium) that it is under the Spanish entity. We also carry out our scientific work in many of the Mediterranean countries, either European and non-european. We also fundraise in other European countries such as Italy, non-european like Switzerland. 2. Does your foundation plan to expand its activities to other Member State(s) in the foreseeable future? If yes, in which form (e.g. foreign foundations, branches, subsidiaries, provision of services, export/direct sales of goods, fund raising, grant making)? Please indicate to which Member State(s). Yes, the main problem is that to operate in any Member State country we need to have a registered entity. We are exploring fundraising from France, Germany and the Netherlands. 3. Please indicate the approximate yearly expenditure of your foundation. The European section of Oceana has a budget for 2009 of around 3 million Euros. 4. Please indicate whether the purpose of your foundation is (1) public benefit only, (2) mixed public benefit and private or (3) private only. (1) Public benefit only. Question 1: Barriers to the cross-border activities/establishment of foundations Q 1.1 The study identifies four categories of civil law barriers/difficulties for the crossborder activities of foundations in Europe (pp ): 1) Recognition of foreign foundations (pp ), 2) Recognition of trusts (p. 107), 3) Cross-border transfer of the Real Seat (pp ), 4) Cross-border transfer of the Registered Seat (pp ). Do you agree with these findings? Yes. Q 1.2 Do you see any further civil law barriers/difficulties? Please specify. I think the study covers all. Q 1.3 Please rank the civil law barriers in order, starting with the one you find the most important. - Being able to work in any member state without having to establish and register a new organisation in each country. - Being able to open branches or contract people in other Member state country without the need of opening a new branch organisation (register, etc.). 6

7 Q 1.4 If you are answering for a foundation, please give concrete examples of the civil law barriers and/or difficulties you have encountered. How do you deal with these barriers/difficulties? Have they influenced your plans to conduct cross-border activities? Oceana is currently working on establishing a legal entity in Belgium as we have an office there. Obviously the legal paperwork and establishing the entity there is expensive and we could use that money to achieve the objectives of our organisation. I think most of these efforts and money could be saved if a new figure of European Foundation is created. Q 1.5 If you are answering for a foundation and have tried to transfer your real or registered seat cross-border, have you experienced any problems? Please specify your reasons for wanting to transfer the seat and the problems experienced, if any. We have not done this. Q 1.6 The study identifies eight categories of tax law barriers/difficulties for the cross-border activities of foundations in Europe (pp ): 1) Income taxation of foreign foundations (pp ), 2) Income taxation of domestic foundations operating abroad (pp ), 3) Income taxation of domestic donors of foreign foundations (p. 116), 4) Income taxation of foreign donors of domestic foundations (p. 117), 5) Income taxation of foreign donors of foreign foundations (pp ), 6) Income taxation of affiliated beneficiaries (p. 118), 7) Inheritance taxation (pp ), 8) Further taxes (pp ). Do you agree with these findings? If not, please explain why. Yes. Q 1.7 Do you see any further tax law barriers/difficulties? Please specify. No. Q 1.8 Please rank the tax law barriers in order, starting with the one you find the most important. - Being able to fundraise in any member state without having to establish and register a new organisation in each country. - The European Section of Oceana cannot carry out any fundraising on individuals or companies in other Member States countries due to the unavailability of offering tax deduction as they would get if they give a donation to an organisation established in their countries. - Being able to offer the donor to get the deduction no matter in which Member State has done the donation to a European foundation. Q 1.9 If you are answering for a foundation, please give concrete examples of the tax law barriers and/or difficulties you have encountered. How do you deal with these barriers/difficulties? Have they influenced your plans to conduct cross-border activities? 7

8 It is mentioned in the previous answer. Mainly with international companies it is difficult to work on fundraising since the tax deduction is important for the company and we cannot offer it. Q 1.10 Do you consider the civil law barriers or the tax law barriers more important? In our case, they have the same importance. Q 1.11 Why do foundations set up additional organisations/structures in other Member States in your view? I think it depends on the organisation. I think a foundation sets up additional structures to be able to fundraise in the countries, to work on local issues and be perceived as closer to the society, to benefit their donors (individuals and companies) with tax benefits, to work directly with each government when the organisation is an advocacy one. Q 1.12 The study seems to identify tax barriers as the main reason for foundations setting up additional organisations/structures in other Member States (p. 122). Do you agree with this finding? If not, what do you think is the main reason for foundations setting up additional structures/organisations in other Member States? Yes, we agree that tax barriers are one of the main reasons. Question 2 What solutions would be most appropriate Q 2.1 The study assesses five different options to deal with the barriers/difficulties identified. The options assessed are (p ): 1) Status quo combined with soft law instruments 2) Harmonization 3) Bilateral or multilateral treaties 4) A European Foundation Statute without tax elements, and 5) A European Foundation Statute with tax elements What other options for solving the problems do you see if any? No, I think it covers all. Q 2.2 The study suggests that of the above options, the European Foundation Statute seems to be the preferable policy option (p. 1). Do you agree? Why/why not? Yes. Q 2.3 If you do not agree, what do you consider as the preferable policy option? Why? Q 2.4 Would you consider a European Foundation Statute which does not include tax elements (for instance a tax-exempt status in all EU Member States, p.191) as a useful/attractive instrument? Why/why not? We would consider, obviously it is better than the current situation, but it is not the perfect one. 8

9 Q 2.5 Do you believe that an accreditation system (pp ) could be a proportionate solution to the problems for cross-border activities that foundations face today? Why/why not? No, I think to have an accreditation could be part of the solution but other important issues should be included as well. Q 2.6 What added value do you think a "European label" (obtained for instance through a European legal form like the European Foundation) would bring for the foundations? I think it will give confidence to the donor. Q 2.7 In your view, the benefits attached to a "European label" for foundations: can only be achieved through a specific European legal form (European Foundation Statute) can be achieved through an accreditation system can already be achieved through national foundations (e.g. through their names, statutes, marketing) can be achieved through other means, which ones? In my opinion, the European label can be achieved through a specific European legal form to have the relevance and to be respected. Question 3: Content and form of a possible statute for a European Foundation Q 3.1 According to the study the European Foundation should have the following five main characteristics (p.194): 1) Legal personality 2) Promotion of a public benefit purpose 3) No membership 4) State supervision, and 5) Establishment by registration Do you agree that a European Foundation should have these five characteristics? If not, please explain why. Yes. Q 3.2 How detailed should the European Foundation Statute be? Should it be as comprehensive as possible (as is the case for the Commission proposal for a European Private Company Statute) or should it only contain basic rules and refer to national laws on other issues (as is the case for the European Company Statute) (pp )? I think it should contain basic rules and refer to national laws. 9

10 Q 3.3 Should an initial endowment be required (p. 199)? If yes, how large an endowment should be required? I think so. I would say no more than 25,000. Q 3.4 What should be the rule on economic activities by the European Foundation itself (p. 204)? I think as the study recommends, the economic activities should be subordinated to the foundation s public benefit purpose. Q 3.5 How should the supervision of a European Foundation be arranged (pp )? In the state where the main office is based. Q 3.6 On what conditions should an existing foundation be able to transform itself into a European Foundation (p 184)? When it is for public benefit and works at least in two Member States. Q 3.7 If you think that the European Foundation should have other characteristics, please specify which ones. Question 4: Potential transformation of existing foundations into a European Foundation If a European Foundation Statute were introduced, the possibility of transforming existing foundations into a European Foundation would seem to depend on several factors e.g. the statutes of the foundation ("will of the founder"), the agreement of the board of the foundation, the approval of the supervisory authority, the scope of crossborder activities and existing barriers, as well as on the content of a possible European Foundation Statute (p.184). Q 4.1 If you are answering for a foundation, would you consider transforming your foundation into a European Foundation if possible? Yes, that s for sure. Q 4.2 On what criteria would the decision of the board depend? Being able to work in different European countries without establishing a legal entity in each one and the possibility of fundraising without problems in Member States. Q 4.3 What do you think the benefits and drawbacks of a transformation in the case of your foundation would be? The drawback of having to invest an endowment for the European foundation. Q 4.4 Would the possibility to transform itself into a European Foundation be decisive in order for your foundation to expand its activities to other Member States? Why/why not? Oceana works already in different issues in different Member State countries. The transformation into a European Foundation will give us more opportunities to fundraise and work in other countries without problems. 10

11 Q 4.5 In case your foundation already operates cross-border, would this possibility lead to a substantial increase of cross-border activities? Hopefully, yes. Question 5: Any other comments 11