Seat theory versus incorporation theory

An analysis of the ECJ's jurisdiction and its implications

Research Paper (undergraduate) from the year 2007 in the subject Business economics - Law, grade: 1,2, Heilbronn University of Applied Sciences (Business School Heilbronn (MBA)), course: The governmental and legal environment of business, 23 entries in the bibliography, language: English, abstract: This report is about the European Court of Justice's jurisdiction and its implications on German Corporate Law: It explores how European Law is influencing and thereby changing national Corporate Law. In doing so, the author analyses the impact of the ECJ's rulings in the cases Daily Mail, Centros, Überseering as well as Inspire Art and their effect on the - until recently in continental Europe prevailing - seat theory. Furthermore, the author carefully analyses the subsequent developments in Germany, with a particular focus on the trend to form a British Limited instead of a German GmbH as well as the thus resulting reform of German Limited Liability Company Act (GmbHG). Finally, the new competition of legal forms is evaluated by balancing the arguments in favour and/or against this development. Keywords seat theory, Sitztheorie, incorporation theory, Gründungstheorie, Daily Mail, Centros, Überseering, Inspire Art, race to the bottom, race for laxity, Limited, SE, Limited Liability Company Act, GmbHG