In several member states the private company limited can be considered as largely equivalent to the public company, except that its shares are not freely transferable. Other states consider this pe of company as being more akin to the partnerships, although members enjoy limited liability Ithough the internal organisation might be different, the external structure and behaviour of these companies is in fact largely identical to that of the public companies limited. Therefore, there were good arguments to treat both types of companies on the same footing The factual situation in the different directives is quite diverse: while the first, the fourth, the seventh and the eleventh directives are applicable both to the public and the private company types, the second, third, sixth apply only to the public company limited The 12th on the single -membe pany applies only e private limited company, as this is the only form in which a one-man company is usually allowed In fact one should put a question mark beside the above used distinction between public and private companies, as being equivalent to the continental divide between SA en Sarl. In the approach followed in the UK, the former are subspecies of the same single company form, the company ares Inder the continental concept, the Sa and the Sarl, although having many common features, are generally considered different company types. Moreover the differences between the Sa and the Sarl, or what generally are considered equivalent national forms, vary appreciably from state to state The issue is far from merely technical Member states have had ambivalent feelings as to the extension of some of the harmonised European rules to company types that are not explicitly viewed by the directives. Some member states have taken an activist stand, extending the european principles to all company types, at least those with limited liability. So e.g. is part of the capital formation and protection rules that are applicable to the French Sa also applicable to the French Sarl. Belgium has taken a more radical stand it applies the rules equally to both Sa and Sprl, and some of them even to the co-operative societies, although these are considered out of the scope of the harmonisation in other states. Therefore, the effects of the European harmonisation often extend beyond the horizon of the sa One can also understand why some member states that are critical of some of the European rules, will resist any attempt to extend the harmonisation across the board to all companies with limited liability When the Sarl has not been submitted to all of the rules of the European harmonisation, this company type has played the role of a shelter, or some will say, of an evasion technique. The exemption of the Sarl from the cumbersome rules of the Second Directive on financial assistance (art. 23)has opened up the possibility to organise useful transactions, such as management buy outs by interposing a Sarl, there where the deal would be forbidden if done directly by an SA. This form of competition between company types deserves special mention. In some states it has been even more evident between the co-operative societies and the Sarl, as both were, for practical purposes This is especially the case with the extension of the Second directive to the private companies limited,a proposal that has been voiced in Germany as a technique to deal with the issues dealt with in the Centros case See LUTTER, M. "Das Europaische Unternehmensrecht im 21. Jahrhundert,, ZGR 2000, 1 and HIRTE, Die aktienrechtliche Satzungsstrenge: Kapitalmarkt und sonstige Legitimationen versus Gestaltungsfreiheit, ZGR Sonderheft 13, 1998, 71-72 20 See WYMEERSCH, Kritische benadering en synthese van de besproken vennootschappen'in Miskende vennootschapsvormen, Koninklijke Federatie van Belgische Notarissen, Kluwer, Antwerpen, 1991, 153-180 e Financial Law institute. Universiteit Gent 2001© Financial Law Institute, Universiteit Gent, 2001 6 In several member states the private company limited can be considered as largely equivalent to the public company, except that its shares are not freely transferable. Other states consider this type of company as being more akin to the partnerships, although members enjoy limited liability. Although the internal organisation might be different, the external structure and behaviour of these companies is in fact largely identical to that of the public companies limited. Therefore, there were good arguments to treat both types of companies on the same footing. The factual situation in the different directives is quite diverse: while the first, the fourth, the seventh and the eleventh directives are applicable both to the public and the private company types, the second, third, sixth apply only to the public company limited. The 12th on the single-member company applies only to the private limited liability company, as this is the only form in which a one-man company is usually allowed. In fact one should put a question mark beside the above used distinction between public and private companies, as being equivalent to the continental divide between SA en Sàrl. In the approach followed in the UK, the former are subspecies of the same single company form, the company limited by shares. Under the continental concept, the Sa and the Sàrl, although having many common features, are generally considered different company types. Moreover the differences between the SA and the Sàrl, or what generally are considered equivalent national forms, vary appreciably from state to state. The issue is far from merely technical. Member states have had ambivalent feelings as to the extension of some of the harmonised European rules to company types that are not explicitly viewed by the directives. Some member states have taken an activist stand, extending the European principles to all company types, at least those with limited liability. So e.g. is part of the capital formation and protection rules that are applicable to the French SA also applicable to the French Sàrl. Belgium has taken a more radical stand: it applies the rules equally to both SA and Sprl, and some of them even to the co-operative societies, although these are considered out of the scope of the harmonisation in other states. Therefore, the effects of the European harmonisation often extend beyond the horizon of the SA. One can also understand why some member states that are critical of some of the European rules, will resist any attempt to extend the harmonisation across the board to all companies with limited liability19. When the Sàrl has not been submitted to all of the rules of the European harmonisation, this company type has played the role of a shelter, or some will say, of an evasion technique. The exemption of the Sàrl from the cumbersome rules of the Second Directive on financial assistance (art. 23) has opened up the possibility to organise useful transactions, such as management buy outs by interposing a Sàrl, there where the deal would be forbidden if done directly by an SA. This form of competition between company types deserves special mention. In some states it has been even more evident between the co-operative societies and the Sàrl, as both were, for practical purposes, largely equivalent20. 19 This is especially the case with the extension of the Second directive to the private companies limited, a proposal that has been voiced in Germany as a technique to deal with the issues dealt with in the Centros case. See LUTTER, M. ‘Das Europäische Unternehmensrecht im 21. Jahrhundert’, ZGR 2000,1 and HIRTE, ‘Die aktienrechtliche Satzungsstrenge: Kapitalmarkt und sonstige Legitimationen versus Gestaltungsfreiheit’, ZGR Sonderheft 13, 1998, 71-72. 20 See WYMEERSCH, ‘Kritische benadering en synthese van de besproken vennootschappen’ in Miskende vennootschapsvormen, Koninklijke Federatie van Belgische Notarissen, Kluwer, Antwerpen, 1991, 153-180