To enhance the attractiveness and competitiveness of EU capital markets, the 2024 Listing Act introduces targeted reforms to the Prospectus Regulation and the Market Abuse Regulation (MAR). This article identifies the main amendments to the EU prospectus regime and analyses to what extent they may reduce listing costs and contribute to a more attractive listing environment in the EU, without harming investor protection. The analysis focuses on three key areas of reform. First, the Listing Act significantly broadens exemptions to the prospectus obligation for secondary issuances. Second, it seeks to improve the readability and comprehensibility of prospectuses by introducing page limits and standardized sequences and formats and reducing disclosure regimes for already-listed issuers and Small and Medium-sized Enterprises (SMEs). Third, it addresses fragmentation across Member States by harmonizing the National Competent Authorities' approval procedures for prospectuses. The analysis shows that, although the potential benefits of this reform may not be underestimated, it is unclear to what extent targeted amendments will significantly enhance listing activity in EU capital markets.
This article examines how the principle of energy solidarity and the EU regulatory framework on capacity sharing affect the legal duties of directors in energy companies. Energy solidarity, as established in Article 194(1) of the Treaty on the Functioning of the European Union (TFEU) and reinforced by case law such as Germany v. Poland (OPAL), has evolved into a legally binding norm that reshapes corporate responsibilities. The analysis focuses on how this principle, together with regulations like (EU) 2017/1938 and (EU) 2019/941, interacts with traditional fiduciary duties of care and loyalty in the corporate governance of critical energy infrastructure. Through a doctrinal method, the article argues that solidarity obligations now impose preventive duties on directors, requiring them to integrate crisis response mechanisms and cross-border coordination into their decision-making. Regulatory compliance is no longer limited to internal matters but extends to geopolitical risk modelling, infrastructure resilience, and intergovernmental cooperation. Directors may incur liability for failing to anticipate solidarity-based obligations, especially under national laws aligned with stakeholder governance models. The article concludes that the convergence of EU energy security law and corporate governance requires a recalibration of board practices. Traditional tools such as risk committees and stress testing remain relevant but must be precisely adapted to solidarity-related obligations. Directors who overlook these developments may not only face regulatory consequences but also increasing scrutiny from shareholders and the public. Energy solidarity is thus not a peripheral concern but a core component of lawful and resilient corporate governance in the EU energy sector.
The Flexible Capital Company (Flexible Kapitalgesellschaft-FlexCo), which came into effect on 1 January 2024 in Austrian company law, has been introduced as a hybrid company type between the Gesellschaft mit beschr & auml;nkter Haftung (GmbH) and the Aktiengesellschaft (AG). Created under the 2023 Companies Law Amendment Act (GesRAG 2023), FlexCo aims to offer a less bureaucratic and more flexible corporate structure for start-ups, social entrepreneurs and SMEs. While retaining the core principles of the GmbH, it integrates innovative elements from the AG, such as capital increases, the ability to repurchase its own shares, and financing tools. Notable features of the FlexCo include low capital requirements (minimum individual contribution of EUR one), share transfers without notary approval, company value shares, and the option for written voting. Tax advantages that encourage employee participation and flexible decision-making processes make FlexCo attractive in the modern business world. However, with only 666 FlexCo companies established compared to 12,194 GmbH companies according to 2024 data, this new structure has not yet gained full acceptance in the market. Since FlexCo balances tradition and innovation through a regulatory dualism approach, holding significant potential in financial reporting, transparency, and corporate accountability. This study, therefore, aims to analyse FlexCo's legal framework, characteristics, and long-term impacts.
In this article, I discuss the implications of the Multiple Voting Rights Directive of 23 October 2024, which requires EU Member States to permit multiple voting structures for companies listing on multilateral trading facilities. I reflect on the abandonment of the one-share-onevote principle, assess the risks of excessive flexibility in shareholder rights, and highlight the challenges of effective minority protection and market liquidity. Finally, I question the assumption that legal reform alone will significantly enhance the attractiveness of EU capital markets.
This editorial introduces the European Company Law special issue on Corporate Climate Transition Plans (CCTPs), a fast-evolving legal instrument for aligning corporate conduct with climate objectives. As climate-related regulation moves from voluntary disclosure to enforceable obligations, the European Union has placed transition planning at the core of corporate sustainability law. Key legal developments, including the Corporate Sustainability Due Diligence Directive (CSDDD), the Corporate Sustainability Reporting Directive (CSRD), and the EU Deforestation Regulation (EUDR), require companies to develop credible, science-based plans to reduce greenhouse gas (GHG) emissions and adapt their business models accordingly. Amid these regulatory shifts and the legal uncertainty introduced by the Omnibus reform, this editorial outlines the legal landscape, identifies emerging compliance challenges, and highlights the interplay between EU law, soft law instruments, and climate litigation. It also previews six contributions to the special issue, covering a range of topics from banking regulation and fiduciary duties to litigation and biodiversity. Together, these papers provide legal scholars, practitioners, and policy makers with a multidimensional understanding of climate transition planning as a tool for steering corporate transformation in the face of planetary crisis. The editorial concludes with a call to action: robust transition planning is not only a legal obligation, but a strategic and ethical imperative.
Originally developed for military planning and policy-making purposes, scenario analysis has increasingly been recognized in financial and banking regulation as a key technique for identifying and managing climate and environmental risks. Unlike traditional risk assessment models, scenario analysis captures forward-looking and non-linear risks under conditions of fundamental uncertainty. A growing body of rules and supervisory expectations urges banks to integrate scenario-based methodologies into (climate-related) stress testing exercises and transition plans. This paper examines the legal basis for requiring banks to conduct climate scenario analyses under the EU prudential and corporate framework, exploring their role as a risk-management, strategic planning and disclosure tool. We analyse the powers of supervisory authorities to prescribe and scrutinize climate scenario exercises as well as banks’ obligations to ground their transition planning strategies in scientifically sound scenarios. We argue that, despite the versatile nature of these tools, banks are expected to operate in a persistent state of legal uncertainty.
The European Union (EU) Market Abuse Regulation 596/2014 (MAR) stipulates requirements regarding the disclosure of inside information. National laws of the EU Member States, based on the EU Transparency Directive 2004/109, as well as the MAR, furthermore stipulate rules regarding the disclosure of the possession of certain percentages of shares and/or votes in the issuer/listed company. All these rules and requirements aim at achieving fair market conditions for (potential) investors and the well-functioning of financial markets. In this article, an overview and discussion will be provided regarding the most important rules with respect to transparency in the MAR and in the Financial Supervision Act applicable in the Netherlands, especially in light of the (upcoming) changes in this respect in the MAR implemented via the EU Listing Act 2024/2809.
Since the reform of the enterprise concept in Belgian company law in 2018, there has been a lot of debate in legal doctrine and jurisprudence about the question of whether company directors can be qualified as enterprises in their own right. This article examines the qualification of company directors as enterprises under Belgian law, a question with significant legal and practical consequences. The classification matters because natural persons who qualify as enterprises gain access to bankruptcy proceedings and the included fresh start benefits. In the Belgian Code of Economic Law (CEL), two main conditions are generally identified for natural persons to be considered enterprises: they must act in a self-employed capacity and exercise a professional activity. However, this enterprise concept has sparked significant debate in both legal doctrine and jurisprudence, more specifically about whether a third autonomous condition exists that the individual must also have their own organization. The Belgian Court of Cassation has addressed this issue in three judgments concerning company directors, holding that a director must indeed demonstrate an autonomous organization to be qualified as an enterprise. This case law effectively introduces a new condition not explicitly foreseen in the legislation, which considerably complicates the qualification as an enterprise for all natural persons.
This paper explores how courts and claimants engage with science-based mitigation pathways in corporate target-setting litigation. In these cases, claimants seek to translate macro-level climate objectives-designed to limit warming to 1.5 degrees C-into enforceable legal obligations for individual companies. They typically favour 1.5 degrees C-compatible pathways with limited or no overshoot, rejecting those that depend heavily on speculative carbon dioxide removal (CDR) technologies. Based on writs of summons from high-profile cases such as Milieudefensie et al. v. Shell (2019), Notre Affaire & agrave; Tous v. TotalEnergies (2020), and Greenpeace v. ENI (2023), the paper highlights the emerging practice of 'normative filtering' through legal reasoning. It also sheds light on the different strategic approaches adopted by claimants, particularly in the debate between applying sector-specific reduction targets and adopting a global target applicable to all businesses. The paper also turns to judicial responses, drawing on the Hague Court of Appeal ruling in Milieudefensie v. Shell (2024), which illustrate courts' reluctance to impose quantified emissions reduction targets on a single company based on a specific mitigation scenario. Ultimately, the article contends that the success of corporate target-setting cases hinges on the judiciary's willingness to engage more proactively with mitigation scenarios as normative tools, rather than deferring to their 'policy-relevant but non-prescriptive' origins.
This paper examines the regulatory potential of EU legislation to push forest-dependent companies to transition from causing forest degradation towards ecologically sustainable forest management. Such a transition is urgent because industrial logging of primary forests.1 remains a structural part of the forest economy, contributing to ecosystem degradation and climate instability. Using institutional theory, this study explores how EU regulation may shape such companies' behaviour and their business models. We apply the Lessig model (1998)2 that argues that law can regulate, directly or indirectly, social and cultural norms ('norms'), market dynamics ('market'), and the physical environment ('architecture'). From this perspective, we analyse the potential of the EU Taxonomy Regulation (TR), the EU Corporate Sustainability Reporting Directive and the European Sustainability Reporting Standards (ESRS), the EU Corporate Sustainability Due Diligence Directive (CSDDD), the European Omnibus package, the EU Deforestation Regulation (EUDR), and the EU Nature Restoration Law (NRL) to urge forest-dependent companies towards new business models. Findings indicate that effective legislation has the potential to reconfigure industrial architecture from primary forest logging towards ecologically sustainable forestry. However, current EU regulation does not explicitly mandate companies to adopt biodiversity transition plans (norms), nor effectively protect existing European primary forests (architecture). Nonetheless, it is argued that climate transition plans also require forest-dependent companies to shift from forest degradation practices to ecologically sustainable forest management. This transition is essential because forests play a crucial role in absorbing carbon emissions and in providing climate stability.
Originally developed for military planning and policy-making purposes, scenario analysis has increasingly been recognized in financial and banking regulation as a key technique for identifying and managing climate and environmental risks. Unlike traditional risk assessment models, scenario analysis captures forward-looking and non-linear risks under conditions of fundamental uncertainty. A growing body of rules and supervisory expectations urges banks to integrate scenario-based methodologies into (climate-related) stress testing exercises and transition plans. This paper examines the legal basis for requiring banks to conduct climate scenario analyses under the EU prudential and corporate framework, exploring their role as a risk-management, strategic planning and disclosure tool. We analyse the powers of supervisory authorities to prescribe and scrutinize climate scenario exercises as well as banks' obligations to ground their transition planning strategies in scientifically sound scenarios. We argue that, despite the versatile nature of these tools, banks are expected to operate in a persistent state of legal uncertainty.
Since 2014, the European Union's (EU's) Non-Financial Reporting Directive (NFRD) has mandated large EU firms to disclose non-financial performance, aiming to promote corporate sustainable behaviour. This study empirically examines the impact of the NFRD on corporate environmental performance, with a focus on greenhouse gas (GHG) emissions. The analysis consists of two main components: (1) a descriptive, industry-level overview of both absolute GHG emissions (Scopes 1, 2, and 3) and emissions intensity among firms subject to the NFRD, and (2) a quantitative estimation of the Directive's causal impact on GHG emissions, both in absolute terms and intensity, across ten different industry sectors. The results reveal significant variation across sectors. The highest absolute and intensity emitters are the Energy, Materials, and Utilities sectors. Across all industries, GHG emissions are largely driven by Scopes 2 and 3 sources. On average, the NFRD is associated with a 22.12% reduction in total GHG emissions. Nonetheless, this effect is highly uneven across sectors and primarily driven by reductions in low-emission industries. In contrast, high-emission sectors such as Energy, Materials, and Utilities show no statistically significant reductions. The results highlight the limited effectiveness of a horizontal approach to sustainability regulation, suggesting the need for sector-specific requirements in terms of non-financial publication and Climate Transition Plans.
EU legislation aiming to foster sustainable corporate behaviour (notably the Corporate Sustainability Due Diligence Directive (CSDDD)) compels large European corporations to adopt and put into effect climate transition plans. The banks among these corporations face a similar obligation under the EU's prudential supervision framework. This dual demand raises the question what requirements a climate transition plan of a bank should meet. This question has been put in sharp relief by climate litigation initiated against ING Group by Friends of the Earth Netherlands (Milieudefensie). The NGO argues that ING's climate transition plan is insufficient to address its significant contribution to climate change, thereby violating the bank's duty of care under the Dutch Civil Code. This paper argues that requirements can be derived from the systemic role of banks as 'universal owners', providing financial services across the economy. Combined with norms found in EU regulation and international standards, this provides sufficient grounds to determine what constitutes proper emission reduction targets in banks' climate transition plans. Concretely, we argue that large, diversified banks in industrialized countries should set (1) absolute reduction targets that (2) minimally align with the global average reduction needed to achieve the 1.5 degrees C climate goal of the Paris Agreement.
The EU's recent legislations on corporate sustainability have reignited the debates about the roles and duties of directors in addressing climate change, mainly due to the obligation on climate transition plans outlined under Article 22 of the Corporate Sustainability Due Diligence Directive (CSDDD). However, defining the directors' role in this regard remains a challenging task due to the silence of the European legislation regarding directors. Moreover, the tensions between the obligations under the EU legislation on climate, national corporate laws that strongly emphasize corporate interest, and corporate dynamics that often grant shareholders a dominant position, create a web of conflicting dilemmas. As a result, directors are caught in a love triangle of competing shareholder, corporate, and climate-related interests. These dilemmas can further lead to risks for liability if directors want to go beyond mere legal compliance and seek ambitious climate strategies. Against this background, this paper aims to answer two interconnected questions: (1) What dilemmas could directors face in the climate transition processes? (2) What intervention scenarios targeting directors and shareholders could enable more ambitious climate strategies? While this paper primarily draws on Dutch corporate law as a point of departure for a more concrete examination, its findings may offer broader insights as comparison allows.
In this article, I examine the development of multiple voting rights in French company law, with a focus on listed companies. I first outline the traditional loyalty share system and its gradual consolidation following the Florange Act. I then analyse the 2024 reform allowing multiple voting shares (MVS) at the time of listing. Finally, I argue that despite this significant innovation, loyalty shares will likely remain the dominant mechanism due to the restrictive conditions attached to multiple voting rights.
In this article, we analyse the legal framework for loyalty voting shares (LVS) in Belgium and the implications of the EU Directive on Multiple Voting Shares (MVS). We evaluate the limited uptake and practical use of LVS, highlighting their function as a control-enhancing tool for insiders. Based on proposals by a working group within the Belgian Centre for Company Law, we present a policy framework to implement MVS in Belgium, including safeguards for minority shareholders, a 1:20 maximum voting ratio, and the possibility of midstream adoption. We conclude that MVS provide a more flexible and effective governance mechanism than LVS to stimulate long-term ownership and listing activity in Belgium.
