The European Alternative to Uniformity in Corporation Laws
Although the European Communities chose many patterns of business law that were parallel to the American, they deliberately rejected the American freedom of each state to frame its corporation law to suit itself. They decided to impose not complete uniformity, but a degree of “coordination” of “equivalent safeguards” that they deemed appropriate to the existence of an economic union. Leading commentators have described the process as “harmonization.”
The decision to coordinate stimulates reflection on the relative merits of the American system of giving states a free choice of corporation regimes, restricted only marginally by federal securities regulation, and the European system of “minimum standards.” The “safeguards” that leaders of other industrial societies have chosen as appropriate means of promoting prosperity in a market economy offer Americans a challenging example of such standards.