Coherence of EU choice of law rules for companies

The ECJ strengthens throughout its case - law the coherence of EU law in two particular respects.

First, the ECJ has focused on the parallels between natural and legal persons, and more particularly on the unilateral determination of the nationality of natural persons combined with the other Member States’ duty to recognize this nationality on the one hand and the unilateral determination of the lex societatis combined with a similar duty of recognition on the other hand.

Second, and in a similar logic, the ECJ transposes the rule of mutual recognition to international company law within the internal market. Of course, this doesn’t come as a surprise, as the right of establishment more generally is governed, both through the text of the TFEU and its interpretation by the ECJ, by the same rules on non-discrimination, non-restriction and mutual recognition as the other freedoms. Yet,the determination and the application of the lex societatis according to a logic which lays various duties upon the home and host States respectively, also results in a paradigm shift in conflict of laws. The traditional multilateral and universalist approach which characterizes (continental) conflict of laws possibly must make room for a unilateral approach which grants a central place to intra-Union mobility and recognition of rights granted by other Member States.

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