The Societas Europaea: Good News for European Firms

31 Pages Posted: 25 May 2009 Last revised: 10 Oct 2010

See all articles by Horst Eidenmueller

Horst Eidenmueller

University of Oxford - Faculty of Law; European Corporate Governance Institute (ECGI)

Andreas Engert

Freie Universität Berlin, Department of Law; European Corporate Governance Institute (ECGI)

Lars Hornuf

Technische Universität Dresden; CESifo (Center for Economic Studies and Ifo Institute)

Date Written: July 1, 2009

Abstract

When Council Regulation (EC) No 2157/2001 on the Statute for a European Company (Societas Europaea - SE) became effective on 8 October 2004, it offered publicly traded companies, for the first time, a choice between competing company laws, namely the national law of the company’s home state and the law of the supranational SE. Using an event study methodology, we analyse a unique dataset of publicly traded firms that have announced to re-incorporate under the SE Regulation. We find the re-incorporation decision to have a positive impact on firms’ stock market value. The abnormal returns associated with re-incorporating as an SE increase over the years, which we interpret as the result of declining legal uncertainty and a rising reputational value of the SE corporate form.

Keywords: event study, Societas Europaea, European Company, EC company law, incorporation, charter competition, regulatory competition, legal arbitrage

JEL Classification: G34, G38, K22

Suggested Citation

Eidenmueller, Horst G. M. and Engert, Andreas and Hornuf, Lars, The Societas Europaea: Good News for European Firms (July 1, 2009). ECGI - Law Working Paper No. 127/2009, Available at SSRN: https://ssrn.com/abstract=1409555

Horst G. M. Eidenmueller

University of Oxford - Faculty of Law ( email )

St Cross Building
St Cross Road
Oxford, OX1 3UL
United Kingdom

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

Andreas Engert (Contact Author)

Freie Universität Berlin, Department of Law ( email )

Boltzmannstr. 3
Berlin, 14195
Germany

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

Lars Hornuf

Technische Universität Dresden ( email )

Dresden, 01307
Germany

HOME PAGE: http://www.hornuf.com

CESifo (Center for Economic Studies and Ifo Institute) ( email )

Poschinger Str. 5
Munich, DE-81679
Germany

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