Constitutionalising the Market,Marketising the Constitution,and to Tell the Difference: On the Horizontal Application of the Free Movement Provisions in EU Law

Ever since the Court's judgment in Walrave, there has been a concerted effort in caselaw and doctrine to limit the horizontal direct effect of free movement provisions to exceptional circumstances. This article suggests that this effort has always been incoherent, and is simply untenable after Viking and Laval. The implications are far reaching, especially in the sphere of the free movement of capital and corporate governance where the Court is well on its way of imposing a model of shareholder primacy on European company law. Full direct horizontal effect will also have important repercussions for private law and its ability to resolve conflicts between economic freedoms and fundamental rights. Given the nature of the free movement provisions, their horizontal effect will sometimes lead to a constitutionalised market and sometimes to a marketised constitution, without there being any principled way of distinguishing between the two. In that light, horizontal direct effect is very unlikely to enhance the effectiveness of internal market law—whichever model of the social market economy it is thought to embody—and is best abandoned.     

Three Principles of Transnational Corporate Bankruptcy Law: A Review

Abstract: After having discussed the weaknesses of the universalist and territorialist approaches to transnational corporate bankruptcy law, this article argues that a free‐choice régime could combine the advantage of ex post value maximisation of the firm's assets with a comparatively higher degree of ex ante predictability to investors. In addition, it could lead to a better alignment between corporate ownership structures and corporate bankruptcy régimes. Moreover, a free‐choice régime could potentially open the door for regulatory competition in corporate bankruptcy law. However, EC Regulation 1346/00 on insolvency proceedings implements a system of modified universalism, which allows for strategic ex post forum shopping by debtors while keeping the national legislatures’ monopoly in the field of corporate bankruptcy in place. It is suggested that even though it cannot be predicted that a free‐choice régime will pressure state lawmakers to improve their corporate bankruptcy laws, a system of free choice could redirect the law‐making agenda in the EU by focusing the coordination efforts of lawmakers on those issues—such as security interests in property and statutory priority rights—which could negatively affect the proper functioning of the Internal Market, while enabling Member States to customise corporate bankruptcy laws to local preferences and needs.     

Does Control Make a Difference? The Moral Foundations of Shareholder Liability for Corporate Wrongs

The doctrine of limited liability, as traditionally understood, prevents shareholders from being held personally liable for corporate wrongs. Several authors have recently argued that the doctrine should be modified to make some or all shareholders individually liable for torts committed by corporations in which they hold shares. This article distinguishes three types of argument that might provide a moral basis for shareholder liability in such cases. I contend that while these arguments support holding at least some shareholders liable for corporate torts, they fail to justify a general regime of unlimited pro rata shareholder liability. The level of control shareholders exercise over a company makes an important difference to their moral duties to compensate victims of corporate wrongdoing.     

Hypothetical consent and moral force

This article starts by examining the appeal to hypothetical consent as used by law and economics writers. I argue that their use of this kind of argument has no moral force whatever. I then briefly examine, through some remarks on Rawls and Scanlon, the conditions under which such an argument would have moral force. Finally, I bring these considerations to bear to criticize the argument of judge Frank Easterbrook's majority opinion in Flamm v. Eberstadt.     

The New Insolvency Law and Governance of Corporate Legal Person

Start of the insolvency proceedings influences the two basic problems of corporate governance: restriction about the “soft budget” of corporation and “information asymmetry” between the interior and exterior person. In fact, the insolvency law is a mechanism of the potential exterior supervision. In the insolvency proceedings, most of the information is open to the creditor and to the superintendent, who is liable for protecting the interest of the creditor. The key problems of corporate governance are transparency and information disclosure. The insolvency law provides the power of supervision to the creditor when corporation insolvency. Of importance is that power is conducted by collectivity and supported by judicatory and professional organization. In June 2004, the finance committee submitted the new draft of the insolvency law to the standing committee of the national people’s congress. There are many articles about corporate governance. These articles are generally divided into two kinds, one is restriction on conduct of the supervisors in the period of the insolvency proceedings, and the other is examination of the conduct before the start of the insolvency proceedings. Translated from Jurist Review, Vol. 2, 2005 (in Chinese)     

Share Capital and Creditor Protection: Efficient Rules for a Modern Company Law

This article examines the case for rules of company law which regulate the raising and maintenance of share capital by companies. The enquiry has practical relevance because the content of company law is currently under review, and the rules relating to share capital have been singled out for particular attention. The existing rules, which apply generally, are commonly rationalised as a means of protecting corporate creditors. The analysis considers whether such rules can be understood as responses to failures in the markets for corporate credit. It suggests that whilst the current rules are unlikely, on the whole, to be justified in terms of efficiency, a case may be made for a framework within which companies may 'opt in' to customised restrictions on dealings in their share capital.     

Making the rules and breaking the rules: the political origins of corporate corruption in the new economy

Recent scandals at companies like Enron and WorldCom have pointed to the systemic origins of many corporate frauds. This paper advances the argument that behind those scandals were strategic political actions that changed the regulatory and legal environment in which those firms operated and created criminogenic institutional frameworks that facilitated acts of corporate corruption. Three case studies involving (1) the California energy crisis of the late 1990's, (2) the regulation of energy derivatives, and (3) accounting treatments of stock options, are presented to illustrate how markets and the rules that govern them are the products of political processes and how they can create motivations and opportunities for corporate fraud. The implications these case studies have for the study of corporate crime and corruption are discussed.     

A Dive into Deep Constitutional Waters: Article 50, the Prerogative and Parliament

This article analyses the Article 50 TEU debate and the argument that for the UK Government to trigger the formal withdrawal process without explicit parliamentary authorisation would be unlawful, because it would inevitably result in the removal of rights enjoyed under EU law and the frustration of the purpose of the statutes giving those rights domestic effect. After a brief survey of Article 50, this article argues first of all that the power to trigger Article 50 remains within the prerogative, contesting Robert Craig's argument in this issue that it is now a statutory power. It then suggests a number of arguments as to why the frustration principle may be of only doubtful application in this case, and in doing so it re‐examines one of the key authorities prayed in aid of it ‐ the Fire Brigades Union case.     

Learning Pain: Poetry in Emotion

This paper asks the question; is a poetic response to law and suffering legitimate? It reflects upon Robert Duncan's poem Persephone and imagines the (dis)connections between law, literature and poetry. It muses upon the “Trauma” of the poem and the “wound” considered in the context of both public and private law and considers the politics of sentimentality, dominant within the political agenda of the 21st century. The article uses the poem as a lens which reveals that the law fails to address the question of suffering as the wound of the poem is used by the poet as a pedagogical argument to teach us about loss.

     

(Non‐)Enforcement of Directors’ Duties in Corporate Groups: Goh Chan Peng v Beyonics Technology Ltd

Corporate groups, a ubiquitous feature of modern business, pose formidable challenges for common law courts relying on traditional corporate law doctrine. Arising out of a corporate group's recent bid to recover millions of dollars in lost profits from a former director and CEO who had diverted a core business, Goh Chan Peng v Beyonics Technology Ltd raised thorny issues of separate legal entity doctrine, single economic unit theory, and reflective loss shared by common law legal systems. Despite finding that the defendant had breached his duties to the ultimate holding company, the Singapore Court of Appeal absolved the faithless director from most of his liabilities, relying on limited domestic precedent to the exclusion of a rich body of Commonwealth jurisprudence – including the House of Lords’ landmark Johnson v Gore Wood decision. This note explores the paths not taken by the court, and highlights the pitfalls of a narrow, autochthonous approach to problems of common law doctrine.     

Of ‘Landmark’ or ‘Leading’ Cases: Salomon's Challenge

This article seeks to question the two dominant conceptions of ‘landmark’ or ‘leading’ cases in English legal scholarship, using the House of Lords decision in Salomon v. Salomon Co Ltd. – the most famous case in corporate law – as a case study. It argues that neither the first dominant conception of ‘leading’ or ‘landmark’ cases, characterized by the analysis of the intrinsic merits of a case, nor the second, which looks at the historical contexts in which cases were decided, appears sufficient by itself to determine whether a case is landmark or canonical. Rather, we have to look at how the canonicity of a case is constructed by subsequent courts. The article seeks to advance the debate concerning the formation of landmark cases and aims to challenge certain prevailing views on the canonicity of corporate law's arguably most significant case.     

资本制度变革下的资本法律责任——公司法修改的理性解读

公司法资本制度的重大变革并未否定资本制度的基本原理和与之相关的股东出资义务和责任。取消最低资本额,改变的只是股东出资义务的范围或数额,而非股东出资义务本身。公司资本从有限制的认缴制到无限制的认缴制,改变的只是股东履行出资义务的期限,股东以其认缴而非实缴的出资额为限对公司债务负责,资本的"认而不缴"并不免除股东的出资义务或责任。认缴资本的采用也不能终结或取代实缴资本的独特作用。资本真实的法律要求不因取消法定最低资本额和实行完全的认缴资本制而改变,取消验资的特定法律程序,决非否定资本真实性的法律要求,而只是改变资本真实的实现方式。     

The Common Core between Human Rights Law and International Criminal Law: A Structural Account

Legal scholars and theorists have recently drawn a more sustained attention to the link between international human rights law (hereafter IHRL) and international criminal law (hereafter ICL). This concerns both positive and more normative accounts of the link. Whether positive or normative, the predominant approach to constructing the link is substantive. This overlap is normatively justified in similar terms by reference to a subset of moral human rights. In this paper, I offer an alternative to the substantive approach. After identifying two flaws in the substantive approach (the problem of threshold and the problem of ethical neutrality), I defend what I call a structural account by focusing on duty‐holders. I start by reconstructing two structural characteristics common to IHRL and ICL qua international legal regimes: who has the authority to address violations of IHRL and ICL, and who can be liable for those violations. I then infer that public authority (functionally construed) constitutes the common structural core of IHRL and ICL. I rely on the extraterritorial application of IHRL and on the collective dimension of ICL violations to further support the argument. I finally offer an argument explaining the normative point of those structural features. I hold that IHRL and ICL (their adjudicative and liability regimes) are both necessary (but clearly not sufficient) to render this exercise of public authority legitimate to its subjects.     

The Totemic Authority of the Court

This article examines the place of the court within civil religion. It is argued that every civil religion is rooted in a magical anchor that in contemporary democratic civil religions is provided by the court. While in most institutions of civil religion totemic authority is represented, in court it is present. Therefore, court proceedings are occurrences of magic: they are performances (rituals and ceremonies) during which the sacred Thing is present. In court, the law itself and the clerical community to which it was entrusted assume the characteristics of the sacred Thing. The law appears under two facets: on the one hand, it is a norm and a word while, on the other hand, it is a Thing devoid of meaning and reason. Formalism is a magical mode of thinking that treats law as a timeless and meaningless Thing. In the course of the argument, the distinctions between ceremony and ritual, between social structure and communitas, and between religion and magic are reformulated, and the concepts of zone of familiarity and clerical community are laid out in a nutshell. This revised version was published online in July 2006 with corrections to the Cover Date.     

Law against the Rule of Law: Assaulting Democracy

This article examines how authoritarian contenders use law to advance an agenda geared to exclusive state power in light of a paradigmatic case: the National Socialists’ takeover of the German state apparatus in spring 1933. This case highlights two ways in which an office holder is able to expand his power in an authoritarian fashion through legal dispositions. A conjunctural use of law for authoritarian purposes draws on legal statutes to undercut the political capacity of opponents and competitors, hollow out institutional checks, and crucially hamper civil freedoms. Taking advantage of constitutional provisions that make institutional subversion from within possible (‘constitutional Trojan horses’), a structural use of legal statutes reorders the power structure by reallocating decisional rights. In both cases, law serves as a weapon against the rule of law. These considerations raise the question of the standards by which we are to judge the legality of such acts. Contemporary instances of democratic backsliding are cases in point.     

Attribution in Company Law

In Bilta (UK) Ltd (in liquidation) v Nazir (No 2), the Court of Appeal held that the ex turpi causa defence was inapplicable by refusing to attribute the fraud of the directors and the sole shareholder to the company in connection with the company's claim against them and third party co‐conspirators. It is significant that the court has not only clarified the law in relation to attribution, but it did so by rejecting the majority's reasoning and endorsing the dissenting judgment in the House of Lords decision in Stone & Rolls (in liquidation) v Moore Stephens (a firm). This article evaluates the decision in Bilta by critically examining the fundamental principles and policies that apply to the three distinct circumstances under which corporate attribution should or should not take place.     

Schauer's Anti‐Essentialism

In his new book, The Force of Law, Frederick Schauer maintains that law has no necessary properties (a position he calls legal anti‐essentialism), and that therefore jurisprudents should not assume that an inquiry into the nature of law has to be a search for such properties. I argue, however, that Schauer's attempt to show that legal anti‐essentialism is a defensible position fails, because his one main argument (the cognitive science argument) is either irrelevant or else incomplete, depending on how one understands it, and because the other main argument (the family resemblance argument) is false.     

Psycholegal Scholarship's Contribution to False Consciousness About Injustice

The field of psychology and law began with an avowed focus on social justice. In the past two decades, that focus has been diverted. With justice defined more narrowly than previously, psycholegal research has contributed to false consciousness about the degree to which law reduces injustice and promotes social change. Primary components of false consciousness about law include the belief that procedural justice is more important than substantive or distributive justice, the acceptance of legal doctrines that support corporate capitalism, and the belief that the strict rule of law is inherently superior to individualized equity and commonsense justice.