The use of option, method of resolving disputes under the coordination of laws in the European Economic Community: the case of the Seventh Directive on consolidated accounts.
The Treaty of Rome organized the removal of all barriers to trade resulting from protectionist legislation of the Member States and provided, the abolition of all restrictions on the free movement of goods, persons, services and capital. The founding fathers of European Economic Community have annexed thereto a list of substances for which the Council and the Commission are authorized to develop regulations. It is within this list, Article 54.3-g, that is the legal basis for the coordination of national legislation on company law. Under this Article, the Council has since 1968 adopted a series of measures concerning the coordination of company law within the common market. This coordination will involve the early 1970s, the accounting and financial reporting by companies at the head of a group. When the EU directive on consolidated accounts was adopted in 1983, no fewer than six directives on company law had been adopted. The Seventh European Directive has long been criticized because of the large number of options open to companies in its application. In November 1995, The European Commission announced its new strategy with regard to international accounting harmonization and its willingness to involve the efforts of the IASC and IOSCO. Commenting on the decision of the Commission, Professor Karel Van Hulle, Head of Unit in DG XV (Internal Market and Financial Services) of the European Commission underlined the rigidity of European directives and the fact that this mode of coordination was not adapted to the economic and financial context. Yet a time, updating the European directives was considered but the admission of Van Hulle, it was quickly dismissed. More than twelve years after its adoption by the Council of the European Communities, the Head of Unit of DG XV also refers to the difficulty of obtaining the political agreement on the financial information of groups of companies. From professional private archives of one of the french negotiators in Brussels for the Seventh Directive and of the minutes of proceedings of various European institutions, this paper highlights the difficulty of the coordination of laws within the consolidated of the Economic Community. The analysis of the archives shows that the Groupe d’études des experts-comptables de la Communauté économique européenne, the Economic and Social Committee and the Parliament agree on the general economy of the draft directive. All these institutions emphasize the importance of developing a directive on groups accounting. However, when the debate is placed in front of experts from various national delegations, Brussels become the place of confrontation of radically opposed views on the concept of consolidated accounts. The proliferation of options included in the final text of the Seventh European directive will be the only solution to enable its adoption by the Council on 13 June 1983.
Year of publication: |
2009-07
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Authors: | Bensadon, Didier |
Institutions: | Université Paris-Dauphine (Paris IX) |
Subject: | Accounting history | Group accounting | Coordination of legislation | Seventh european directive |
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