Luca Enriques

Biography

Luca Enriques is Professor of Corporate Law, in association with Jesus College. He studied law at the University of Bologna before completing his LLM at Harvard Law School and working at the Bank of Italy while at the same time earning a Doctorate degree in Business Law at Bocconi University. He then became a member of the University of Bologna Faculty of Law (1999-2012). During that period, he was a consultant to Cleary Gottlieb Steen & Hamilton and an adviser to the Italian Ministry of the Economy and Finance on matters relating to corporate, banking and securities law with a special focus on European Union policy initiatives. He was a Commissioner at Consob, the Italian Securities and Exchange Commission between 2007 and 2012 and Professor of Business Law at LUISS University, Department of Law, in Rome in 2013-14.

He has held visiting appointments at various academic institutions including Harvard Law School, where he was Nomura Visiting Professor of International Financial Systems (2012-13), Cornell Law School (where he was a John Oling Fellow for short stays in 1999 and 2000), the Instituto de Impresa in Madrid (2005), the Radzyner School of Law at the Interdisciplinary Center Herzliya (2013-14), the University of Cambridge Faculty of Law (2015), Columbia Law School (2016 and 2019), and the University of Sydney Law School (2019).

He has published widely in the fields of company law, corporate governance and financial regulation. He is a European Corporate Governance Institute (ECGI) Research Fellow, a member of ECGI's board, the chair of its Research Committee, a Fellow Academic Member of the European Banking Institute, where he co-chairs its FinTech Task Force, and one of the founding academic editors of the Oxford Business Law Blog.

Publications

Recent additions

A Romano, L Enriques and JR Macey, 'Extended Shareholder Liability for Systemically Important Financial Institutions' (2020) 69 American University Law Review 967

Regulators generally have tried to address the problems posed by the excessive risk-taking of Systemically Important Financial Institutions (SIFIs) by placing restrictions on the activities in which SIFIs engage. However, the complexity of these institutions makes such attempts necessarily imperfect. This Article proposes to address the problem at its very source, which is the incentives that SIFI owners have to push for excessive risk-taking by managers. Building on the traditional rule of “double liability,” we propose to modify the current (general) rule limiting the liability of SIFI shareholders to the amount of their initial investments in such companies. We propose replacing the extant limited liability regime with a new system that imposes additional liability over and above what SIFI shareholders already have invested in a preset amount that varies with a SIFI’s centrality in the financial network. Our liability regime has a number of advantages. First, by increasing shareholder exposure to downside risk, it discourages excessive risk-taking. At the same time, by placing a clearly defined ceiling on shareholders’ total liability exposure, it will not obliterate shareholders’ incentives to invest in the first place. Second, the liability to which shareholders are exposed is carefully tailored to the level of systemic risk that their institution creates. Thus, our rule induces shareholders to account for the negative externality SIFIs can impose without unduly stifling such financial institutions’ role within the financial system and in the wider economy. Third, as the amount of liability is clearly defined ex ante using the rigorous tools of network theory, our rule minimizes the influence of interest groups and the impact of idiosyncratic government decisions. Last, as markets know in advance the amount of liability to which shareholders are exposed, our rule favors the creation of a vibrant insurance and derivative market so that the risk of SIFIs defaults can be allocated to those who can better bear it.
L Enriques, Alessandro Romano and T Wetzer, 'Network-Sensitive Financial Regulation' (2020) 45 The Journal of Corporation Law 351

Shocks that hit part of the financial system, such as the subprime mortgage market in 2007, can propagate through a complex network of interconnections among financial and non-financial institutions. As the financial crisis of 2007-2009 has shown, the consequences for the entire economy of such systemic risk materializing can be catastrophic. Following the crisis, economists and policymakers have become increasingly aware that the structure of the financial system is a key determinant of systemic risk. A wide consensus now exists among them that network theory is the natural framework for studying systemic risk. Yet, most of the existing rules in financial regulation are still “atomistic,” in that they fail to incorporate the fact that each individual institution is part of a wider network. This Article shows that policies building upon insights from network theory (network-sensitive policies) can address systemic risk more effectively than traditional atomistic policies, also in areas where an atomistic approach would seem natural, such as the corporate governance of systemically important financial institutions. In particular, we consider four prescriptions for the governance of systemically important institutions (one on directors’ liability, two on executive compensation and one on failing financial institutions’ shareholders appraisal rights in mergers) and show how making them network-sensitive would both increase their effectiveness in taming systemic risk and better calibrate their impact on individual institutions.
ISBN: 0360-795X
L Enriques, 'Pandemic-Resistant Corporate Law: How to Help Companies Cope with Existential Threats and Extreme Uncertainty During the Covid-19 Crisis' (2020) European Company and Financial Law Review 257

DOI: https://doi.org/10.1515/ecfr-2020-0014
This essay argues that, to address the Covid-19 crisis, in addition to creating a special temporary insolvency regime, relaxing provisions for companies in the vicinity of insolvency, and enabling companies to hold virtual meetings, policymakers should tweak company law to facilitate equity and debt injections and address the consequences of the extreme uncertainty firms are facing. After some general reflections upon the type of rules that are needed in these exceptional times, examples of temporary corporate law interventions for the emergency are provided. Specifically, rules to facilitate injections of equity capital and shareholder loans are suggested, together with relaxations of directors’ liability rules and measures to protect firms against hostile takeovers. All of these measures should apply merely by default and only for so long as the emergency lasts. The essay concludes with some thoughts about how to make normal-times corporate law ready for similar emergencies in the future. The goal is both to reduce the risk that the temporary extreme measures enacted for this crisis are made permanent under the pretence that another crisis may hit again and to have quick adaptation mechanisms already in place to respond to such a crisis.
ISBN: 1613-2556

Journal Article (43)

L Enriques and W-G Ringe, 'Bank-fintech partnerships, outsourcing arrangements and the case for a mentorship regime' (2020) 15 Capital Markets Law Journal 374

DOI: https://doi.org/10.1093/cmlj/kmaa019

Fintech firms, once seen as ‘disruptors’ of the traditional banking world, are now increasingly seen as attractive partners for established financial institutions. Such partnership agreements come in different forms and contexts, but most share the goals of outsourcing key banking functions and facilitating market entry for new market players while overcoming relatively tough regulatory hurdles. Yet such arrangements, while generally to be welcomed, pose a number of regulatory problems, in particular concerning the effective supervision of fintechs that operate outside of the direct purview of regulatory authorities. Questions of enforcement and effective supervision emerge, which may ultimately result in problems regarding market stability and systemic risk. Regulatory sandboxes represent one attempt to address these problems but may fail to do so and are often ineffective or unavailable. Other similar solutions, such as fintech charters and umbrella firms, may help but, similarly, provide an imperfect solution. Against this backdrop, we make the case for a ‘mentorship regime’, which provides for a reliable regulatory framework for partnership agreements between fintech firms and established banks. This would allow for a de facto ‘private sandbox’ where experienced firms could mentor new startups and help them to cope with a complex regulatory process. At the same time, a state-backed mentorship plan would clear up the allocation of responsibilities, supervision competences, and liability questions and thus overcome problems of arbitrage and abuse. Ultimately, a mentorship regime may show the way to a new and more reliable future system of banking, making the well-stablished contractual practice of outsourcing banking services more reliable.

ISBN: 1750-7227

L Enriques and D Zetzsche, 'Corporate Technologies and the Tech Nirvana Fallacy' (2020) 72 Hastings Law Journal 55

This Article introduces the term Corporate Technologies (“CorpTech”) to refer to the use of distributed ledgers, smart contracts, Big Data analytics, artificial intelligence and machine learning in the corporate context and analyzes the impact of CorpTech on the future of corporate boards. We focus on the tech manifestation of agency problems within corporations and identify—after considering possible market, governance, and regulatory solutions—elements of a governance framework for the CorpTech age. In particular, we take on a prediction often found in the literature, namely that CorpTech has the potential to solve a number of corporate governance problems for good and even make boards of directors redundant. We argue that this claim is based on what we call the “tech nirvana fallacy,” or the tendency of comparing supposedly perfect machines with failure-prone humans. The inherent features of technology and corporate governance reveal that even well-programmed CorpTech leaves the core issue of corporate governance—conflicts of interest among the relevant corporate stakeholders—untouched. In the Corptech age, the key question becomes: “is the human being that selects or controls the firm’s tech conflicted?” If so, CorpTech itself will be tainted. In fact, the problems arising from the transition to a CorpTech-dominated governance environment may, in the short-term, make things even worse: insufficient understanding of the promise and perils of CorpTech and over-confidence therein may even aggravate agency problems within firms.

ISBN: 0017-8322

L Enriques, Alessandro Romano and T Wetzer, 'Network-Sensitive Financial Regulation' (2020) 45 The Journal of Corporation Law 351

Shocks that hit part of the financial system, such as the subprime mortgage market in 2007, can propagate through a complex network of interconnections among financial and non-financial institutions. As the financial crisis of 2007-2009 has shown, the consequences for the entire economy of such systemic risk materializing can be catastrophic. Following the crisis, economists and policymakers have become increasingly aware that the structure of the financial system is a key determinant of systemic risk. A wide consensus now exists among them that network theory is the natural framework for studying systemic risk. Yet, most of the existing rules in financial regulation are still “atomistic,” in that they fail to incorporate the fact that each individual institution is part of a wider network. This Article shows that policies building upon insights from network theory (network-sensitive policies) can address systemic risk more effectively than traditional atomistic policies, also in areas where an atomistic approach would seem natural, such as the corporate governance of systemically important financial institutions. In particular, we consider four prescriptions for the governance of systemically important institutions (one on directors’ liability, two on executive compensation and one on failing financial institutions’ shareholders appraisal rights in mergers) and show how making them network-sensitive would both increase their effectiveness in taming systemic risk and better calibrate their impact on individual institutions.

ISBN: 0360-795X

A Romano, L Enriques and JR Macey, 'Extended Shareholder Liability for Systemically Important Financial Institutions' (2020) 69 American University Law Review 967

Regulators generally have tried to address the problems posed by the excessive risk-taking of Systemically Important Financial Institutions (SIFIs) by placing restrictions on the activities in which SIFIs engage. However, the complexity of these institutions makes such attempts necessarily imperfect. This Article proposes to address the problem at its very source, which is the incentives that SIFI owners have to push for excessive risk-taking by managers. Building on the traditional rule of “double liability,” we propose to modify the current (general) rule limiting the liability of SIFI shareholders to the amount of their initial investments in such companies. We propose replacing the extant limited liability regime with a new system that imposes additional liability over and above what SIFI shareholders already have invested in a preset amount that varies with a SIFI’s centrality in the financial network. Our liability regime has a number of advantages. First, by increasing shareholder exposure to downside risk, it discourages excessive risk-taking. At the same time, by placing a clearly defined ceiling on shareholders’ total liability exposure, it will not obliterate shareholders’ incentives to invest in the first place. Second, the liability to which shareholders are exposed is carefully tailored to the level of systemic risk that their institution creates. Thus, our rule induces shareholders to account for the negative externality SIFIs can impose without unduly stifling such financial institutions’ role within the financial system and in the wider economy. Third, as the amount of liability is clearly defined ex ante using the rigorous tools of network theory, our rule minimizes the influence of interest groups and the impact of idiosyncratic government decisions. Last, as markets know in advance the amount of liability to which shareholders are exposed, our rule favors the creation of a vibrant insurance and derivative market so that the risk of SIFIs defaults can be allocated to those who can better bear it.

L Enriques, 'Pandemic-Resistant Corporate Law: How to Help Companies Cope with Existential Threats and Extreme Uncertainty During the Covid-19 Crisis' (2020) European Company and Financial Law Review 257

DOI: https://doi.org/10.1515/ecfr-2020-0014

This essay argues that, to address the Covid-19 crisis, in addition to creating a special temporary insolvency regime, relaxing provisions for companies in the vicinity of insolvency, and enabling companies to hold virtual meetings, policymakers should tweak company law to facilitate equity and debt injections and address the consequences of the extreme uncertainty firms are facing. After some general reflections upon the type of rules that are needed in these exceptional times, examples of temporary corporate law interventions for the emergency are provided. Specifically, rules to facilitate injections of equity capital and shareholder loans are suggested, together with relaxations of directors’ liability rules and measures to protect firms against hostile takeovers. All of these measures should apply merely by default and only for so long as the emergency lasts. The essay concludes with some thoughts about how to make normal-times corporate law ready for similar emergencies in the future. The goal is both to reduce the risk that the temporary extreme measures enacted for this crisis are made permanent under the pretence that another crisis may hit again and to have quick adaptation mechanisms already in place to respond to such a crisis.

ISBN: 1613-2556

L Enriques and Alessandro Romano, 'Institutional Investor Voting Behavior: A Network Theory Perspective' (2019) University of Illinois Law Review 223

This Article shows how network theory can improve our understanding of institutional investors’ voting behavior and, more generally, their role in corporate governance. The standard idea is that institutional investors compete against each other on relative performance and hence might not cast informed votes due to rational apathy and rational reticence. In other words, institutional investors have incentives to free ride instead of “cooperating” and casting informed votes. We show that connections of various nature among institutional investors, whether from formal networks, geographical proximity, or common ownership, and among institutional investors and other agents, such as proxy advisors, contribute to shaping institutional investors’ incentives to vote “actively.” They also create intricate competition dynamics: competition takes place not only among institutional investors (and their asset managers), but also at the level of their employees and among “cliques” of institutional investors. Employees, who strive for better jobs, are motivated to obtain more information on portfolio companies than may be strictly justified from their employer institution’s perspective, and to circulate it within their network. Cliques of institutional investors compete against each other. Because there are good reasons to believe that cliques of cooperators outperform cliques of noncooperators, the network-level competition might increase the incentives of institutional investors to collect information. These dynamics can enhance institutional investors’ engagement in portfolio companies and also shed light on some current policy issues such as the antitrust effects of common ownership and mandatory disclosures of institutional investors’ voting.

H Eidenmüller, L Enriques, G Helleringer and K van Zwieten, 'Centros at 20: Regulatory Arbitrage and Beyond. An Introduction' (2019) 20 European Business Organization Law Review 399

DOI: https://doi.org/10.1007/s40804-019-00162-y

ISBN: 1566-7529

J Armour and L Enriques, 'The Promise and Perils of Crowdfunding: Between Corporate Finance and Consumer Contracts' (2018) The Modern Law Review 51

DOI: 10.1111/1468-2230.12316

‘Crowdfunding’ is a burgeoning phenomenon. Its still-evolving status is reflected in diversity of contracting practices: for example, ‘equity’ crowdfunders invest in shares, whereas ‘reward’ crowdfunders get advance units of product. These practices occupy a hinterland between existing regimes of securities law and consumer contract law. Consumer protection law in the UK (but not the US) imposes mandatory terms that impede risk-sharing in reward crowdfunding, whereas US (but not UK) securities law mandates expensive disclosures that hinder equity crowdfunding. This article suggests that while crowdfunding poses real risks for funders, the classical regulatory techniques of securities and consumer law provide an ineffective response. Yet, a review of rapidly-developing market mechanisms suggests they may provide meaningful protection for funders. An initially permissive regulatory approach, open to learning from market developments yet with a credible threat of intervention should markets fail to protect consumers, is justified.

ISBN: 1468-2230

L Enriques and G Hertig, 'Post-crisis Regulation of Asset Management' (2018) Annales des Mines – Réalités Industrielles 88

While asset managers’ behavior has not been among the root causes of the financial crisis, their industry’s size and structure have generated financial stability concerns among policymakers. Global regulatory bodies nowadays agree that asset management activities are “systemically important”. On the other hand, the growth in retail activities has prompted regulatory and self-regulatory bodies to enact new rules relating to conduct of business, advice and best execution. Our essay briefly reviews global reforms affecting the asset management industry, focusing first on systemic interventions and then discussing investor protection reforms. To conclude, it addresses some emerging issues that we expect to be on policymakers’ agenda in the future.

John Armour, L Enriques, Ariel Ezrachi and John Vella, 'Putting technology to good use for society: the role of corporate, competition and tax law ' (2018) Journal of the British Academy 285

Innovation and its main output, technology, are changing the way we work, socialise, vote, and live. New technologies have improved our lives and made firms more productive, overall raising living standards across the world. Thanks to progress in information technology, the rate of change is accelerating. Disruption and disequilibrium are the new normal. In this essay, prepared as a chapter for the first phase of the British Academy ‘The Future of the Corporation’ initiative, we reflect upon the role that corporate, competition and tax law can play both to facilitate innovation and simultaneously assuage emergent societal risks arising from new technologies. We consider means of enhancing investment in research and development (‘R&D’) and optimising corporate organisation. But we also reflect on the risks associated with innovation, such as the use of technology to exploit consumers, manipulate markets or distort, unwittingly or not, the political process. Finally, we consider the way in which the environment for business law reform is subject to new political risks following the challenge to the liberal order from populism and the rising power of dominant technology companies.

L Enriques, 'A Harmonised European Company Law: Are We There Already?' (2017) International and Comparative Law Quarterly 763

DOI: https://doi.org/10.1017/S0020589317000239

To what extent is EU company law harmonized? This article first makes the point that little progress has been made in the direction of company law uniformity within the EU. It then argues that, even leaving aside the question of whether it would be desirable to have a uniform EU company law, that outcome is simply impossible to achieve, due to interest group resistance and the variety in national meta-rules. Yet it concludes that, in a narrow meaning, European company laws have indeed been harmonized: European Member States company laws fit together, which may well be what harmonization, not only etymologically, is all about.

ISBN: 0020-5893

L Enriques, 'Il ruolo dei consigli di amministrazione delle società quotate italiane nell’era della disruptive innovation' (2017) Banca Impresa Società 15

DOI: 10.1435/86766

ISBN: 1120-9453

L Enriques and M Gargantini, 'The Expanding Boundaries of MiFID’s Duty to Act in the Client’s Best Interest: The Italian Case' (2017) The Italian Law Journal 485

MiFID requires investment firms to act in accordance with the best interests of their clients. This overarching principle shapes firms’ professional conduct in at least two ways. First, it sets a general standard firms have to comply with when dealing with their clients, and its breach may lead to civil remedies for clients or administrative sanctions for investment firms. Second, the duty is the backbone of the detailed conduct of business rules within the body of MiFID II and its implementing measures, playing a role in their interpretation. In this paper, we analyse the duty to act in the clients’ best interest within the MiFID II framework, and illustrate its practical relevance by looking at its role in Italian financial markets law. More specifically, after recalling how the duty came to be an essential part of the ISD/MiFID framework, we map how the duty is spelt out, at various junctures, in the Directive and highlight its functions. Next, we look into how the duty operates with reference to different investment services and activities covered by MiFID II, claiming that the duty is quite difficult to reconcile with services characterized by at-arms’-length relationships between the investment firm and the client. Then, we focus on the use of the duty in the law in action of one member state, Italy, where retail investors have suffered from egregious cases of mis-selling of bonds issued by the banks acting as their investment services providers. We conclude that the MiFID II regime falls short of clarifying with sufficient precision the implications of the best interest duty and, at least in the civil law jurisdiction we focus on (Italy), significantly expands the scope for judicial review of purely arms-length firms-clients relationships.

ISBN: 2421-2156

L Enriques and M Gargantini, 'Form and Function in Doing Business Ratings: Is Investor Protection in Italy Still So Bad?' (2016) University of Bologna Law Review 1

DOI: 10.6092/issn.2531-6133/5583

The World Bank’s Doing Business Report (DBR) ranks every year numerous jurisdictions across the globe according to their ability to facilitate business activities. Among the indexes contributing to the definition of the global competitiveness of the legislations, the “Protecting investors index” (PII) measures the protection of minority shareholders in listed companies. In this paper, we analyse the DBR’s assessment of the Italian regulatory framework on investor protection. We find that the PII falls short of properly evaluating the applicable rules. First, it underrates Italy because the DBR evaluation falls short of properly evaluating the role performed by independent directors under Italian rules on related party transactions. In particular, the DBR fails to properly account for independent directors’ power to veto unfair transactions before they are submitted to the board, a safeguard that ensures minority investors’ protection at least as well as mandatory abstention by conflicted directors. Second, past DBR overrated the PII, so that subsequent reforms that substantially improved investor protection have not been grasped by more recent assessments, giving the misleading impression that no relevant changes have occurred. Far from representing one of the multiple coding errors reported in the literature, these flaws aptly show that the DBR methodology, while correctly attempting to preserve consistency in the evaluation of different jurisdictions, adopts an excessively formalistic approach and disregards the function of the rules it scrutinizes. In light of the influence that the DBR exerts on national policymakers, this approach is detrimental because it might induce window-dressing reforms. Moreover, it may rule out experimentation, which is key to ensuring that the applicable rules keep pace with the variety of techniques adopted to expropriate minority shareholders.

ISBN: 2531-6133

L Enriques and D Zetzsche, 'Quack Corporate Governance, Round III? Bank Board Regulation Under the New European Capital Requirement Directive ' (2015) Theoretical Inquiries in Law 211

After a crisis, broad and sweeping reforms are enacted to restore trust. Following the 2007-2008 Great Financial Crisis, the European Union has engaged in an ambitious overhaul of banking regulation. One of its centrepieces, the 2013 Fourth Capital Requirements Directive (CRD IV), tackles, amongst other things, the perceived pre-crisis failings in the governance of banks. We focus on the provisions that are aimed at reshaping bank boards composition, functioning, and their members liabilities, and argue that they are unlikely to improve bank boards effectiveness or prevent excessive risk-taking. We criticize some of them for mandating solutions, like board diversity and the separation of chairman and CEO, that may be good for some banks but are bad for others, in the absence of any convincing argument that their overall effect is positive. We also criticize enhanced board liability by showing that it may increase the risk of herd behaviour and lead to more serious harm in the event of managerial mistakes. We also highlight that the push towards unfriendly boards may negatively affect board dynamics and make boards as dysfunctional as when the CEO dominates them. We further argue that limits on directorships and diversity requirements will worsen the shortage of bank directors, while requirements for induction and training and board evaluation exercises will more likely lead to tick-the-box exercises than under the current situation in which they are just best practices. We conclude that European policymakers and supervisors should avoid using a heavy hand, respectively, when issuing rules implementing CRD IV provisions with regard to bank boards and when enforcing them.

ISBN: 1565-3404

L Enriques, 'Related Party Transactions: Policy Options and Real-World Challenges (with a Critique of the European Commission Proposal) ' (2015) 16 European Business Organization Law Review 1

This paper provides a legal and policy analysis of transactions between a corporation and one of its related parties. It first highlights the reasons why related party transactions (RPTs) are so common around the world. Next, it better identifies the phenomenon as a specific form of potentially abusive behaviour by dominant shareholders and managers, i.e., as an instrument for tunneling, asking why many jurisdictions provide for specific regulations on RPTs in addition to general rules or standards on tunneling. Then, it describes the main legal tools available to prevent corporate agents from diverting value from the corporation via RPTs. Further, it provides a (partially) critical assessment of the measures put forth by the European Commission to harmonise rules on RPTs within the EU, based on the previous analysis of individual legal tools. Finally, it shows that no regulation of RPTs (or tunneling) can succeed in preventing minority shareholder expropriation in the absence of sophisticated enforcement actors (specialised courts and/or active and committed securities regulators) and non-legal supporting institutions, like independent financial media and anti-tunneling social norms.

ISBN: 1566-7529

L Enriques and M. Gatti, 'Creeping Acquisitions in Europe: Enabling Companies to Be Better Safe than Sorry' (2015) 15 Journal of Corporate Law Studies 55

L Enriques, R.J. Gilson and A.M. Pacces, 'The Case for an Unbiased Takeover Law (with an Application to the European Union)' (2014) 4 Harvard Business Law Review 85

L Enriques and D.A. Zetzsche, 'The Risky Business of Regulating Risk Management' (2013) 10 European Company and Financial Law Review 271

L Enriques, 'European Takeover Law: The Case for a Neutral Approach' (2011) 22 European Business Law Review 623

L Enriques and G. Hertig, 'Improving the Governance of Financial Supervisors' (2011) 12 European Business Organization Law Review 357

L Enriques, M. Gargantini and V. Novembre, 'Mandatory and Contract-based Shareholding Disclosure' (2010) 15 Uniform Law Review 713

M. Becht, L Enriques and V. Korom, 'Centros and the Cost of Branching' (2009) 9 Journal of Corporate Law Studies 171

L Enriques, 'Corporate Governance Reforms in Italy: What Has Been Done and What Is Left to Do' (2009) 10 European Business Organization Law Review 477

L Enriques, 'Regulators' Response to the Current Crisis and the Upcoming Reregulation of Financial Markets: One Reluctant Regulator's View' (2009) 30 University of Pennsylvania Journal of International Law 1147

L Enriques and M. Gatti, 'Is There a Uniform EU Securities Law After the Financial Services Action Plan?' (2008) 14 Stanford Journal of Law, Business & Finance 43

P-H. Conac, L Enriques and M. Gelter, 'Constraining Dominant Shareholders? Self-Dealing: The Legal Framework in France, Germany, and Italy' (2007) 4 European Company and Financial Law Review 491

L Enriques and P. Volpin, 'Corporate Governance Reforms in Continental Europe' (2007) 21 Journal of Economic Perspectives 117

L Enriques and M. Gatti, 'EC Reforms of Corporate Governance and Capital Markets Law: Do They Tackle Insiders? Opportunism?' (2007) 28 Northwestern Journal of International Law and Business 1

L Enriques and M. Gelter, 'How the Old World Encountered the New One: Regulatory Competition and Cooperation in European Corporate and Bankruptcy Law' (2007) 81 Tulane Law Review 577

L Enriques, 'Conflicts of interest in Investment Services: the Price and Uncertain Impact of MiFID?s Regulatory Framework' (2006) 2 Revue Trimestrielle de Droit Financier 49

L Enriques, 'EC Company Law Directives and Regulations: How Trivial Are They?' (2006) 27 University of Pennsylvania Journal of International Economic Law 1

L Enriques and M. Gelter, 'Regulatory Competition in European Company Law and Creditor Protection' (2006) 7 European Business Organization Law Review 417

L Enriques and M. Gatti, 'The Uneasy Case for Top-Down Corporate Law Harmonization in the European Union' (2006) 27 University of Pennsylvania Journal of International Economic Law 939

M. Bianchi and L Enriques, 'Corporate Governance in Italy After the 1998 Reform: What Role for Institutional Investors?' (2005) 2 Corporate Ownership & Control 11

L Enriques, 'EC Company Law and the Fears of a European Delaware' (2004) 15 European Business Law Review 1259

L Enriques, 'Silence Is Golden: The European Company Statute as a Catalyst for Company Law Arbitrage' (2004) 4 Journal of Corporate Law Studies 77

L Enriques, 'The Comparative Anatomy of Corporate Law (Book review of REINIER KRAAKMAN ET AL., THE ANATOMY OF CORPORATE LAW. A COMPARATIVE AND FUNCTIONAL APPROACH (OUP Oxford: 2004))' (2004) 52 American Journal of Comparative Law 1011

L Enriques, 'The Mandatory Bid Rule in the EC Takeover Directive: Harmonization Without Foundation?' (2004) 1 European Company and Financial Law Review 440

L Enriques, 'Bad Apples, Bad Oranges: A Comment from Old Europe on Post-Enron Corporate Governance Reforms' (2003) 38 Wake Forest Law Review 911

L Enriques, 'Do Corporate Law Judges Matter? Some Evidence From Milan' (2002) 3 European Business Organization Law Review 765

J. Macey and L Enriques, 'Creditors Versus Capital Formation: The Case Against the European Legal Capital Rules' (2001) 86 Cornell Law Review 1165

L Enriques, 'The Law on Company Directors' Self-Dealing: A Comparative Analysis' (2000) 2 International and Comparative Corporate Law Journal 297

Chapter (16)

L Enriques and Marco Pagano, 'Emergency Measures for Equity Trading: The Case Against Short-selling Bans and Stock Exchange Shutdowns' in C Gortsos, G Ringe (ed), Pandemic Crisis and Financial Stability (European Banking Institute 2020)

After the Covid-19 crisis struck, equity prices abruptly plunged across the world. The clear prospect of an almost unprecedented decrease in supply and demand, coupled with extreme uncertainty about the longer-term prospects for the economy worldwide, justified the price adjustments. Yet, in conditions of plummeting prices and high volatility, policymakers around the world felt under pressure ‘to do something’ to stop the downward trend in market prices. As was the case during the financial crises of 2008-09 and 2011-12, these pressures have quickly led to the adoption of market-wide short-selling bans. In addition, both in Europe and in the US, there have been calls for an even more drastic measure: a lasting ‘stock exchange holiday’. This chapter reviews the evidence on the effects of short-selling bans during the financial crisis and discusses the merits of stock exchange holidays and concludes that neither of these measures bring benefits to financial markets.

L Enriques, 'Missing in Today’s Shareholder Value Maximization Credo: The Shareholders' in L Zingales, JKasperkevic and A Schechter (eds), Milton Friedman 50 Years Later (ProMarket 2020)

(eBook)

L Enriques and T Tröger, 'The Law and (Some) Finance of Related Party Transactions' in L Enriques and T Tröger (eds), The Law and Finance of Related Party Transactions (Cambridge University Press 2019)

DOI: https://doi.org/10.1017/9781108554442

This paper is the introductory chapter of Luca Enriques and Tobias Tröger (eds.), The Law and Finance of Related Party Transactions (Cambridge University Press: forthcoming). Its goal is to sketch out the individual chapters’ contributions to the scholarly and policy debates on the adequate regulation of related party transactions (RPTs). For that purpose, we scope the issue by highlighting the principal costs and benefits of shareholder control, which allows both the implementation of entrepreneurial vision and various forms of rent-seeking. We next proceed by putting the challenges of regulating RPTs into the broader context of conflicts of interest and tunneling techniques. Against this background, we then turn to the main regulatory options available for legislators (independent/disinterested director approval, majority of the minority approval, ex post fairness review, and involvement of supervisory agencies), highlighting some of the key insights on each of them from individual chapters. Finally, we show how the chapters in the book can also inform European legislators who are currently in the process of implementing the revised Shareholder Rights Directive rules on RPTs.

M Bianchi, L Enriques and M Milic, 'Enforcing Rules on Related Party Transactions in Italy: One Securities Regulators’ Challenge' in L Enriques and T Tröger (eds), The Law and Finance of Related Party Transactions (Cambridge University Press 2019)

DOI: https://doi.org/10.1017/9781108554442

J Armour and L Enriques, 'Equity Crowd Funding: An Acid Test for Securities Regulation' in Franklin Allen, Ester Faia, Michael Haliassos and Katja Langenbucher (eds), Capital Market Union and Beyond (MIT Press 2019)

ISBN: 9780262042765

L Enriques and M Gatti, 'Creeping Acquisitions in Europe' in J Grant (ed), European Takeovers: The art of Acquisition (Global Law and Business 2018)

ISBN: 9781787421769

L Enriques, J Armour and M Bengtzen, 'Globalization ' in M Fox, LR Goltsen, EF Greene, MS Patel (ed), Securities Markets Issues for the 21st Century (e-book 2018)

J Armour and L Enriques, 'Individual Investors’ Access to Crowdinvesting: Two Regulatory Models ' in Douglas Cumming and Lars Hornuf (eds), The Economics of Crowdfunding (Palgrave 2018)

Crowdinvesting--raising many small contributions of capital from individual funders via specialized online platforms--is a burgeoning phenomenon. This Chapter first highlights the perils to which individual investors are exposed when they access these platforms. Next, it describes the legal regime in two sample jurisdictions, the US with its tradition of high-fixed-cost, disclosure-intensive securities laws that had to be tweaked to make equity crowdfunding viable, and the UK, which has early on provided for a nimble set of rules for the same. Finally, the Chapter offers some thoughts on the merits of introducing a lighter regime for equity crowdfunding.

ISBN: 978-3-319-66119-3

L Enriques, 'Related Party Transactions' in JN Gordon and G Ringe (eds), The Oxford Handbook of Corporate Law and Governance (Oxford University Press 2018)

DOI: 10.1093/oxfordhb/9780198743682.013.27

L Enriques, 'Empty Threats – Why the UK Has Currently No Chance to Become a Tax or Regulatory Haven' in J Armour and H Eidenmueller (eds), Negotiating Brexit (Beck 2017)

L Enriques and M Gargantini, 'The Overarching Duty to Act in the Best Interest of the Client in MiFID II ' in D Busch and G Ferrarini (eds), Regulation of EU Financial Markets: MIFID II and MiFIR (Oxford University Press 2017)

ISBN: 9780198767671

L Enriques and S Gilotta, 'Disclosure and Financial Market Regulation' in N. Moloney, E. Ferran and J. Payne (eds), The Oxford Handbook of Financial Regulation (Oxford University Press 2015)

M Belcredi and L Enriques, 'Institutional Investor Activism in a Context of Concentrated Ownership and High Private Benefits of Control: The Case of Italy' in JG Hill and RS Thomas (eds), Research Handbook on Shareholder Power (Edgar Elgar 2015)

This chapter describes the experience with activist institutional investors in an apparently unfavorable corporate environment (Italy), commonly depicted as one of concentrated ownership, notoriously inadequate legal protection for minority shareholders and an apparent disregard for their interests by controlling shareholders. We document a non-negligible volume of core active institutional investment, together with some idiosyncratic forms of activism (the appointment of minority directors on the boards of Italian listed companies). We attempt to evaluate whether what we see is genuine shareholder-value oriented activism or a strategy to engage in a privileged relationship with controlling shareholders, in order to share in private benefits of control extraction. We find no sufficient evidence to support a dark side view of shareholder activism, at least as a general explanation. Instead, we provide recent anecdotal evidence of initiatives effectively aimed to curb the extraction of private benefits by dominant shareholders.

ISBN: 978 1 78254 684 9

L Enriques and G. Hertig, 'Shadow resolutions as a no-no in a sound Banking Union' in E. Faia, A. Hackethal, M. Haliassos and K. Langenbucher (eds), Financial Regulation. A Transatlantic Perspective (Cambridge University Press 2015)

L Enriques, 'Company Law Harmonization Reconsidered: What Role for the EC?' in S.M. Bartman (ed), European Company Law in Accelerated Progress (Kluwer Law International 2006)

L Enriques, 'Pyramidal Groups and Separation Between Ownership and Control in Italy' in F. Barca and M. Becht (eds), The Control of Corporate Europe (Oxford University Press 2001)

Other (5)

H Eidenmüller, L Enriques, G Helleringer and K van Zwieten (eds), 'Centros at 20: Regulatory Arbitrage and Beyond' (2019) 20 European Business Organization Law Review 399

ISBN: 1566-7529

L Enriques, 'Società per azioni' (2017) X Giuffrè Editore Enciclopedia del diritto. Annali. 958

Martin Bengtzen and L Enriques, 'Editorial: The ‘Argumentum a Crise’: So Powerful, So Prone to Misuse' (2016) European Company Law 120

ISBN: 1572-4999

L Enriques, 'EU Prospectus Regulation: Some Out-of-the-Box Thinking' (2016) Revista Lex Mercatoria 39

ISBN: 2445-0936

L Enriques, 'Il Regno Unito dopo la Brexit: un nuovo, enorme paradiso fiscale e societario alle porte dell’Unione Europea?' (2016) Osservatorio del diritto civile e commerciale 577

DOI: 10.4478/84999

The Editorial examines whether one of the possible consequences of Brexit could be the creation of a tax and/or regulatory haven in the UK, arguing that the political preconditions for such an outcome are unlikely to exist.

ISBN: 2281-2628