European company statute is approved

Twenty-seven years after it was first proposed, EU leaders broke a deadlock on the establishment of a European company statute yesterday.

The directive will allow companies trading in several EU states to register once in a standard way in only one of them, saving multinationals significant administrative costs.

But the deal, made possible by a Spanish compromise, is also likely to break a blocking minority on another piece of legislation strongly opposed by the Irish, the directive on information and consultation in national enterprises.

It provides for procedures for consulting and informing workforces in companies with more than 50 employees about plans for their future.

Ireland and Britain strenuously oppose mandatory provisions.

And Germany had opposed the measure as a way of pressurising Spain to accept similar provisions in the European company statute.

Berlin is now expected to back the directive, breaking a blocking minority.

The European director of IBEC, Mr Peter Brennan, yesterday expressed concern at the prospect.