Reflexive Governance and European Company Law

The use of reflexive forms of governance is growing within the EU, in particular as the open method of coordination (OMC) is applied to a wider range of contexts. Reflexive approaches view diversity of laws and practices across the Member States as the basis for experimentation and mutual learning within the overall process of European integration. Company law, however, seems to be an exception to this trend: recent activity in this area has mostly taken the form of 'hard law' harmonisation through directives, coupled with the stimulation of regulatory competition through judgments of the European Court of Justice concerning freedom of movement, most notably the Centro s case. The deliberations of the European Corporate Governance Forum barely qualify as a 'company law OMC' because of the limited space allowed for 'learning from diversity'; instead, differences in the laws of the Member States are seen, in the discourse of the Forum, as 'distortions of competition'. In the area of labour law, by contrast, a degree of functional convergence and a coordinated raising of standards have recently been achieved by the dovetailing of the OMC with social policy directives. The contrasting experiences of labour law and company law suggest that reflexive or experimentalist approaches to European governance can be effective when they operate so as to complement mechanisms of harmonisation and regulatory competition, rather than being presented as alternatives to them.