The European Commission, within the time limit of the feasibility of a legislative procedure (three Presidencies), has been very active in the adoption of proposals in the field of private law. On 25 April last, the initiatives entitled "....Company Law Package"although the regulatory package is made up of all these initiatives plus the proposal and Communication on the law applicable to third party rights in the assignment of receivables and securities discussed in this Tribune in the previous issue. The new issue presents the structure of two directives, one dedicated to the use of digital tools and processes in company law; the other integrating a set of measures to facilitate cross-border structural modifications. Today I will focus on the latter. The Commission has finally opted to integrate cross-border structural changes into a single Proposal, as indicated above, in the form of a Directive and aimed exclusively at unlisted companies. The three amendments envisaged aim to strike a balance between the lawful mobility of companies by removing obstacles through action that is not possible from a national perspective and the effective protection of minority shareholders, employees and creditors. This last aspect is the most relevant.

The directive combines one amendment and two new initiatives. The amendment is to the treatment of cross-border mergers in the Codification Directive (EU) 2017/1132, which repealed, inter alia, Directive 2005/56/EC within the REFIT action approach characteristic of the EU legislation phase. The new actions concern intra-EU conversion and cross-border division. As regards the first of these, the change in terminology is new. It no longer refers to the transfer of registered office, a term that conceptually burnt, but prefers to refer to transformation. In doing so, it accepts that the change of applicable law is a genuine structural change. The proposal is aimed at the creation of a common seat transfer procedure in the European Union, as only five states, including Spain, have legislation in this area based on the non-liquidation of the company. The proposal, in general, addresses the core issue of the limits of corporate mobility. When it is lawful and when it is not, which makes its result very rigid and highly evaluative. In contrast, the CJEU judgment of 25 October 2017 (Pulbud) in relation to the transfer of the registered office of a Polish company to Luxembourg - without changing its real or effective seat - held that this is irrelevant since it is not an abuse in itself to establish the registered or real seat of a company in accordance with the law of a Member State. in order to benefit from more advantageous legislation. The new type of spin-off, on the other hand, attempts, on the basis of avoiding the liquidation of the original company, to prevent the dilution of assets and liabilities, in an attempt to shell without financial muscle. The spin-off presents singularities of a compulsory and patrimonial nature that will lead to the concurrence of other applicable laws, such as the one that affects third parties in the assignment of credits. The three figures have a common core. This consists of establishing a system ex ante of the proposed alteration in the country of origin, with the result that the receiving State will generally take account only of its own law for the requirements for incorporation of the converted, merged or divided company within its territory. The change of domicile requires a certificate issued by the competent authority, which is the basis for the registration of the cross-border structural change in the receiving State. For this purpose, the use of ICT and an appropriate connection between the registers is provided for, so that registration and cancellation can be effected without interruption. The control carried out ex ante is more problematic. The directive is based on a clear lack of confidence in the reasons for the company's decision, and therefore establishes value controls. The procedure consists, in general terms, in the issuing of a report by the administrators, - under their responsibility for certainty, with the Member State establishing appropriate sanctions - in which they explain and justifyThe report must include the legal and economic reasons for the decision and its impact on the groups of employees, shareholders and creditors, accompanied by a report from an independent expert - no doubt appointed by the commercial register - if the company is not an SME (the threshold in Spain will mean that almost all companies are SMEs). The report, which is available to employees, must be approved by the general meeting, with a high and adequate majorityThe shareholder's right of withdrawal, paid in cash, for those who did not vote in favour. Its payment or a possible change of the exchange ratio in the event of the shareholder remaining, under certain parameters, will be subject to a specific judicial appeal. All this documentation, according to our system, will require the execution of a notarial deed in which a prior, generic documentary audit of legality will be carried out. The Directive requires a control, administrative or judicial, to which creditors can also expose their possible prejudice. The competent authority must decide on a new concept that did not appear in any previous document: if there are "serious doubts about the existence of an artificial arrangement or structure - artificial arrangement-. The Directive distinguishes, in various provisions, between a commercial register and a competent authority. It will be up to each State to decide which authority this is, and the Directive does not provide for any appeal against this decision. It is reasonable to assume that the commercial register will have both functions. Law 19/2015 on the European company domiciled in Spain, now incorporated into the Capital Companies Act, based on Regulation (EC) No 2157/2001, already establishes the Commercial Register as the authority that issues the certificate of authority for the transfer, but limits its analysis to the content of the public deed filed and the data recorded in the Register, with the possible opposition to the participation of the Spanish company by the Government at the proposal of the Minister of Justice or an Autonomous Community, as the case may be. The proposal for a Directive is much more demanding in terms of the checks to be carried out by the competent authority. A procedure of this rigidity runs the risk, as has already happened with the statutes of the public limited company and the European cooperative, of failing in practice, as it lacks the necessary balance to be useful to European companies, running the risk of their international relocation.