← Back to context

Comment by Gormo

4 days ago

It's funny that the EU pretends not to be a sovereign entity or a state in its own right, but then sets up legal frameworks like this. Even in the US, you can't set up a corporation at the federal level: apart from a handful of entities chartered via special acts of Congress, a business entity must exist under the laws of a particular state.

47 comments

Gormo

Reply
skissane  4 days ago

> Even in the US, you can't set up a corporation at the federal level:

This is only because the drafters of the US constitution didn’t think to list corporations law as an enumerated power of Congress - I don’t think they omitted it out of an ideological conviction, simply because nobody thought of it at the time. That said, given SCOTUS’ expansive reading of the interstate commerce clause, there’s a decent chance SCOTUS would let them get away with a federal corporations law, but they’ve never had the political will to attempt a general federal incorporation law

The drafters of the Australian constitution did list corporations law as a power of the federal government-but they were working over a century later, and they studied the US system intently to try to identify what worked and what mistakes to avoid. However, it took until 1989 for a federal corporations law to be enacted, and then the High Court ruled in 1990 that the new federal corporations law was unconstitutional, because the corporations power in the constitution only authorised federal regulation of existing domestic corporations, not the act of incorporating them - however, this was fixed by a federal-state agreement voluntarily ceding corporations law power to the Commonwealth (this is another innovation the Australian constitution has compared to the US - the ability of the federal level to gain new enumerated powers without constitutional amendment, by the states voluntarily agreeing to cede them)

oytis  4 days ago

You can easily hire a person from Ohio to work for your company incorporated in California without having a separate legal entity in Ohio. Not the case in EU.

  • pyuser583  3 days ago

    True but you do have to register with the state of Ohio, and jump through some hoops.

    It’s possible to be registered in a state you’ve never been to - how many people have actually been to Delaware or Wyoming - and employ nobody at.

    Some countries play this game too - after the Cayman Islands enacted anti money laundering laws, they tried to keep companies with privacy and efficient dispute resolution.

mrtksn  4 days ago

EU is not a sovereign entity or a state but it needs to be and this is one step in that direction. EU eurocrats worked with the people affected of this and put together a proposal and the elected officials of each member state will vote on this.

Anyway, I don't know about the exact wiring of this but an alternative can be to create a virtual country with its own law, sign a trade agreement with the country to give it full access to the EU market and even some special rights and achieve the same effect of getting rid of the regulations and bureaucracy. These arrangements can be very interesting, like the City of London which is like a country inside London that is actually a corporation. Very weird things are possible.

layer8  4 days ago

It’s a mix, some competences lie more with the EU, some remain more, or exclusively, with the member states: https://en.wikipedia.org/wiki/Competences_of_the_European_Un.... Importantly, foreign policy and defense lies more with the member states. In addition, proposals by the European Commission must be approved by the Council (consisting of executives of all member states) in a qualified majority (at least 55% of member states and representing at least 65% of the total EU population) or in some cases unanimously.

pyuser583  3 days ago

Yes, but you can incorporate in any state you want (provided the state allows that).

That means there’s no barrier to movement.

It’d also possible to reincorporate relatively easily.

dmitrygr  4 days ago

They surely became a sovereign entity when they started fining member states (who are allegedly sovereign) for attempting to own their own border policy: https://www.hungarianconservative.com/articles/current/migra...

  • surgical_fire  4 days ago

    Hungary can leave the EU if it wants. Article 50 exists for this.

    If it wants to stay in the EU it has to adhere to the bloc rules. It is not forced to stay in the EU (and, in fact, getting rid of Orban would not be such a bad idea). Hungexit when?

    • joe_mamba  4 days ago

      >If it wants to stay in the EU it has to adhere to the bloc rules.

      What are you supposed to do when the bloc rules imposed upon you now, are not the ones that were agreed upon when you joined? Imagine your landlord or employer changes your contract without your consent and just tells you to walk if you don't like it. It wouldn't be legal anyway, but it would also be a dick move. I'm old enough to see how the EU of today is not the same it was just 20 years ago.

      @dosinga False. All those examples you gave, require bilateral agreement to be legal. At least in Europe. You can't unilaterally change a contract for both parties.

      4 replies →

  • matthewmacleod  4 days ago

    That obviously makes no sense. A club isn’t a sovereign entity just because it has rules. Hungary is free to leave the EU and set a border policy that conflict with EU law if it wishes - but if it wants to remain part of that organisation, particularly one that has open borders thorough The Schengen area, then of course it needs to follow the rules.

    • TacticalCoder  4 days ago

      > Hungary is free to leave the EU ...

      And Poland and Italy and the Netherlands and Luxembourg etc. are all free to voice their opinion as being members of the club.

      The EU is walking on thin ice: it doesn't exist since very long (at least not in that form) and the EUR is a very young currency that is already in serious trouble, with most members of the eurozone deeply indebted (and one that already partially defaulted on its public debt, Greece).

      The hubris of people who think the EU can bully every single country into submission is insane. Many people aren't happy at all with what's going on in the EU. The EU screwed big times on nuclear (and recently acknowledged they fucked up on nuclear), became dependent on Russia for cheap energy (the US warned them this had potential to SNAFU and SNAFU it did) and now has one of the highest energy price in the world. Making it extremely hard for EU industries to compete with the rest of the world.

      There are also many people in the EU who believe that massively importing people from Africa and poor middle-eastern countries (I'm not saying all middle eastern countries are poor: I'm saying middle-eastern countries migration into the EU is mostly from poor middle-eastern countries) won't raise the living standard of the EU.

      The entire "we decide which size cucumbers should have, we decide to break encryption to protect the kids, we decide to flood the continent with migrants, etc. and you STFU or you can get out" is not an acceptable posture.

      Also please let me laugh at the Schengen borders area: we saw how quickly those borders were closed during several occasion, including Covid. But lastly there have been police controls filtrating cars at the borders in Germany: got controlled twice last summer in Germany. So much for the free movement of people.

      My bet is the EUR is going to die a quick death (one of the most stupid currency every invented: cannot work with different fiscal laws and different productivity in the various eurozone countries). And my second bet is that this is going to put a lot of pressure on the entire EU thing.

      The EU is not doing well. The US and China's GDPs grew like crazy since the 2008 financial crisis while inflation-adjusted the EU barely moved.

      At some point people should do well to wonder if the EU construct ain't the root cause of the problem.

      3 replies →