This study presents a comparative analysis between paper and online processes of the following company operations: company registration; company dissolution; filing and disclosure of company information and merger processes. The study also analyses the impact that the use of digital tools in these operations with regard to:
- Socio-economic area (including level of employment, working conditions and social protection of employees, employee rights to information, consultation and, where relevant, participation in company boards, posting of workers or income distribution);
- Legal certainty;
- Illegal/fraudulent activities of companies.
The study focuses on 13 Member States (Belgium, Bulgaria, Denmark, Estonia, France, Germany, Hungary, Italy, Luxembourg, the Netherlands, Poland, Portugal, Romania) and the United Kingdom*.
* (The UK was a Member State when this study was carried out)
The study found that the use of digital tools in company registration, dissolution, filing and merger processes could have the following effects:
- Enhanced efficiency and legal certainty of the analysed company law operations. An analysis of those Member States' laws and practices, where digital company law processes are available, found that company law processes are significantly quicker and more cost effective when carried out online than when carried out through paper form.
- Hypothesis that digitalisation will lead to proliferation of letterbox companies and would have negative socio-economic impact is rejected.
- Increased ability to detect fraudulent and illegal activities. An analysis of the company registration process across 14 Member States found that the use of digital tools, in particular the lack of physical presence before a local competent authority, does not play any causal role in the corporate form being abused for fraudulent and illegal activities. In fact, the study found that the increased digitalisation of company law enables business registers to consult more efficiently with other competent authorities such as fiscal authorities, social security or business registers in other jurisdictions.
HOW IS THE STUDY USEFUL?
The results of the study highlight the benefits that can be achieved from the appropriate integration of digital tools into company law practices. It displaces a number of perceptions and socio-economic concerns surrounding the use of digital tools in company law and demonstrates that the integration of digital processes into company law operations can be beneficial for companies, public authorities and stakeholders.
The findings of the study were used in preparation of the “Company Law Package” initiative.