SE Regulation: Transposition of the Regulation was finally approved by the Congress (lower house) at the beginning of 2006. The parliamentary discussions were not significant as the proposals of the parliamentary groups were mainly technical. In general terms, it was seen as a positive step towards the creation of legal guarantees under Spanish law on the SE, the modernization of Spanish commercial law – mainly through the possibility of dual-tier corporate governance – and as a possible incentive for foreign firms to invest in Spain and so contribute to reducing the worrying trade deficit. The Socialist parliamentary group emphasised that the Regulation could lead to significant administrative cost savings for firms.

SE Directive: Congress approval of transposition of the Directive at committee level is expected in June 2006. It can then be sent to the Senate (upper house) and return to the Congress after the summer for definitive approval. The political and technical frame for the position of the Socialist majority group was the ruling of the Economic and Social Council ( Consejo Económico y Social) in 2005 (see Report June 2005). The amendments of the conservative Partido Popular included a proposal to regulate confidentiality more strictly, to remove trade union members not belonging to the firm from corporate boards, and to change the composition of the special negotiating body. None of these amendments were included in the (almost) definitive text. The only real amendment to the transposition text proposed by Congress was the extension of the Directive to European cooperatives with SE status (‘Second additional provision’) (four articles).

Social Partners

a) Unions (CCOO & UGT)

In the discussions and analyses of the trade unions the consensus seems to be that the SE Regulation and Directive could become a major issue in the medium term, but not for the time being. Firms do not feel particularly motivated to make use of it as it does not provide clear or significant benefits. Only in the context of possible tax harmonization at the EU level could it lead to significant changes in the Spanish corporate landscape. At present, the Directive is mostly an internal issue in countries with big European firms and board-level participation legislation than a real pan-European issue.

Nevertheless, in the last few months there has been some movement in the insurance sector. When the German firm Allianz, with several thousand employees in a number of Spanish subsidiaries, decided to become an SE, the possibility arose of sending a Spanish representative to the central management board. This issue generated a discussion on corporate governance within the trade unions (finance and insurance sector) which can be considered something of a novelty in Spain, although its possible long-term and strategic significance for society as a whole and the labour movement in particular has not yet come under discussion. It all depends on the direction Allianz will take.

b) Employers and firms

During the parliamentary debates on the Directive, the business press emphasised that its main purpose was to extend the board-level participation traditions of central and northern Europe to the Spanish corporate system. In this way it was attempting to portray it as an ’artificial’ or ’imported’ issue in Spanish industrial relations. This has been, more or less, the ‘official’ position of the Spanish Employers’ Association since the beginning of the discussions on the SE.

Nevertheless, three Spanish firms (whose names were not revealed by the Employers’ Association) – two in the banking sector and one in industry – showed some interest. After examining the details of the Regulation and the Directive they decided not to establish an SE, however. Their arguments were not political but mainly economic and technical: they consider SE law as ’much too complicated’ in technical terms and they do not see how it could lead to a real reduction in administrative costs within their European activities. Another reason for the reluctance of Spanish firms to make use of the SE legislation, according to the Employers’ Association, is simply that there are not many Spanish firms with sufficient capital or otherwise meeting the necessary requirements. For example: there are fewer than 10 Spanish firms with an EWC. Such firms could be considered the first candidates for becoming an SE. As the 10th Directive on transnational mergers will soon be approved by the Spanish Parliament, Spanish firms are more likely to make use of it.