Hostile takeover bids in the European Union: regulatory steps en route to an integrated capital market

This paper intends to highlight the regulatory direction concerning hostile takeover bids, along the European Union moves forward. For the first sight it was difficult to forecast the effects of the EU Takeover Directive. Some of its provisions certainly meant a significant step towards establishing a higher level of protection for minority shareholders. However, some other provisions could have indirect adverse effects. The breakthrough rule for instance, as currently implemented into the national laws, seems unlikely to carry any kind of notable benefit in the short term. There is a fundamental difference that can be revealed between the regulatory systems of the United States and the European Union in terms of their orientation. In the United States the practice of the Delaware courts definitely rejected shareholder decision making in numerous significant decisions concerning takeovers and simultaneously emphasized the importance of directors in corporate management. However, in Europe the regulations rely on shareholder decision making to a much greater extent.