The Business Judgement Rule and Its Reception in European Countries
Adina PONTA and Radu N. CATANĂ, The Macrotheme Review 4(7), Winter 2015 The Macrotheme Review A multidisciplinary journal of global macro trends THE BUSINESS JUDGEMENT RULE AND ITS RECEPTION IN EUROPEAN COUNTRIES Adina PONTA and Radu N. CATANĂ Faculty of Law, Babeș-Bolyai University, Cluj-Napoca, Romania Abstract The Business Judgement Rule is the core doctrine of Corporate Law, because it has a major implication on the liability of corporate directors, but also influences the relationship between a company’s shareholders and directors. The interpretation of this Rule, as a behavioral standard or as an abstention doctrine, can determinatively influence the judicial findings regarding the liability of directors, who acted in consideration of their fiduciary duties. In the same time, a correct interpretation of the Rule contributes to the innovation of business. This paper examines the application possibility of this typical Common Law Rule in the European legal systems. To test the hypothesis, we present the traditional American approaches of this doctrine and we identify the current procedural, but also cultural impediments of the European jurisdictions, which hinder a faithful transposition of the Business Judgement Rule in Europe. Since this Rule represents the most important consequence of the trust and powers attached to a corporate director’s role, the findings establish that the Business Judgement Rule is the answer to the continuous tension between the major values of the corporate world: authority and liability. Keywords: Business Judgement Rule, directors' liability, fiduciary duties, duty of care, Abstention Doctrine, Immunity doctrine, European Union. 1. Introduction In the Common Law doctrine and jurisprudence, the directors of a company owe what the Delaware Supreme Court has called ”the triad of fiduciary duties": duty of care, good faith and duty of loyalty.
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