The Court of Justice of the European Union (CJEU) today issued a judgment concluding that EU Member States cannot impose mandatory liquidation on companies that seek to transfer their registered office to another EU Member State. The CJEU found that the transfer of the registered office of a Polish company to Luxembourg, when there is no change in the location of its real head office, falls within the scope of the freedom of establishment protected by EU law.
The case is: Polbud – Wykonawstwo sp. z o.o., C-106/16 (25 October 2017)
As explained in a related CJEU release, a company established in Poland decided to transfer the company’s registered office to Luxembourg, but without transferring to Luxembourg either the place where the company’s business was managed or the place where that company’s business was actually conducted. Because of this action, a liquidation procedure was opened and recorded in the Polish commercial register and a liquidator was appointed.
In today’s judgment, the CJEU found that EU law extends the benefit of freedom of establishment to all companies or firms formed in accordance with the law of an EU Member State and having their registered office, their central administration or principal place of business within the European Union. As such, this includes, in particular, the right of a company to convert itself into a company or a firm governed by the law of another EU Member State.
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