Tougher regulation and closer scrutiny of executive responsibilities is now an established feature of the corporate landscape across Europe and beyond. Knowing the rules governing directorships is vital, particularly for companies that are expanding through cross-border M&A activity or launching ventures in new jurisdictions.
CMS has updated and expanded its international Guide to Duties and Responsibilities of Directors. The new edition focuses on the rules for the most common form of company in 24 European jurisdictions, together with Brazil, China, Mexico and the Gulf states of Oman and the United Arab Emirates.
Bill Carr, Partner at CMS in London comments, "Today's multinational executives increasingly hold directorships in companies in a number of jurisdictions, and often take on their new duties and responsibilities at short notice. Directorship rules have become more detailed, and can vary significantly from country to country. We have compiled the CMS guide as a quick reference source that points executives towards the key regulations in each country."
The Czech Republic, France, the Netherlands, Spain and Switzerland are among the countries that have introduced significant legislative changes to company law in the past two years. "In the Netherlands, the Management and Supervision Act came into force in 2013, introducing the one-tier-board system. Now, the Dutch parliament intends to adopt new legislation to fight bankruptcy fraud. This new legislation will allow to impose restrictions on a fraudulent director of a bankrupt company on becoming a director of another company or incorporating a new company" adds Roman Tarlavski, Partner at CMS in Amsterdam.
For each country, the CMS Guide outlines rules that apply to executive/managing directors in the following key areas: eligibility requirements; how directors can be appointed to and removed from office; authority and representation; working rules of the board; contractual relationship with the company; conflicts of interest; director's duties; liability and limitation of liability; immigration issues; taxation; and social security.
In addition to including Turkey and the non-European jurisdictions for the first time, the updated CMS Guide reflects legislative and regulatory changes introduced in each of the 29 juridictions since late 2012.
For more information, contact Roman Tarlavski.