Effective protection of creditors’ interests in private companies: Obligatory minimum capital rules versus contactual and other ex post mechanisms

    Research output: Contribution to journalArticle

    Abstract

    his article reveals arguments for and against the initial minimum capital of private companies. It explains that the initial minimum capital rule, which was entrenched in the Second Company Directive as of 13 December 1976, provides for little meaningful benefit in terms of creditors’ protection in private companies. Furthermore, the present paper reviews possible alternative mechanisms for creditors’ protection that could achieve the same effects as the minimum capital rule, although more efficiently and at lower costs. Finally, the author evaluates the legislation on the initial capital of private companies in Lithuania and proposes some potential future trends in this field.
    Original languageEnglish
    Pages (from-to)213-228
    JournalSocialinių mokslų studijos: mokslo darbai
    Issue number3 (7)
    Publication statusPublished - 2010

    Fingerprint

    Effective protection
    Private companies
    Lithuania
    Costs
    Legislation
    Future trends

    Keywords

    • Authorized capital
    • Public limited liability company
    • Limited liability
    • Creditors’ protection in a private company
    • Considerable capital reduction
    • Capital sufficiency
    • Capital maintenance

    Cite this

    @article{badec9a8bcf743d0996ee35122bb4fa9,
    title = "Effective protection of creditors’ interests in private companies: Obligatory minimum capital rules versus contactual and other ex post mechanisms",
    abstract = "his article reveals arguments for and against the initial minimum capital of private companies. It explains that the initial minimum capital rule, which was entrenched in the Second Company Directive as of 13 December 1976, provides for little meaningful benefit in terms of creditors’ protection in private companies. Furthermore, the present paper reviews possible alternative mechanisms for creditors’ protection that could achieve the same effects as the minimum capital rule, although more efficiently and at lower costs. Finally, the author evaluates the legislation on the initial capital of private companies in Lithuania and proposes some potential future trends in this field.",
    keywords = "Authorized capital, Public limited liability company, Limited liability, Creditors’ protection in a private company, Considerable capital reduction, Capital sufficiency, Capital maintenance",
    author = "Olga Petroševičienė",
    year = "2010",
    language = "English",
    pages = "213--228",
    journal = "Socialinių mokslų studijos: mokslo darbai",
    issn = "2029-2236",
    publisher = "Mykolas Romeris University",
    number = "3 (7)",

    }

    TY - JOUR

    T1 - Effective protection of creditors’ interests in private companies

    T2 - Obligatory minimum capital rules versus contactual and other ex post mechanisms

    AU - Petroševičienė, Olga

    PY - 2010

    Y1 - 2010

    N2 - his article reveals arguments for and against the initial minimum capital of private companies. It explains that the initial minimum capital rule, which was entrenched in the Second Company Directive as of 13 December 1976, provides for little meaningful benefit in terms of creditors’ protection in private companies. Furthermore, the present paper reviews possible alternative mechanisms for creditors’ protection that could achieve the same effects as the minimum capital rule, although more efficiently and at lower costs. Finally, the author evaluates the legislation on the initial capital of private companies in Lithuania and proposes some potential future trends in this field.

    AB - his article reveals arguments for and against the initial minimum capital of private companies. It explains that the initial minimum capital rule, which was entrenched in the Second Company Directive as of 13 December 1976, provides for little meaningful benefit in terms of creditors’ protection in private companies. Furthermore, the present paper reviews possible alternative mechanisms for creditors’ protection that could achieve the same effects as the minimum capital rule, although more efficiently and at lower costs. Finally, the author evaluates the legislation on the initial capital of private companies in Lithuania and proposes some potential future trends in this field.

    KW - Authorized capital

    KW - Public limited liability company

    KW - Limited liability

    KW - Creditors’ protection in a private company

    KW - Considerable capital reduction

    KW - Capital sufficiency

    KW - Capital maintenance

    M3 - Article

    SP - 213

    EP - 228

    JO - Socialinių mokslų studijos: mokslo darbai

    JF - Socialinių mokslų studijos: mokslo darbai

    SN - 2029-2236

    IS - 3 (7)

    ER -