1. THE EPC VERSUS THE UK PRIVATE LIMITED COMPANY After ECJ decisions in Centros and Überseering competition increased between Company Law systems in EU Member States

2. RESULTS OF THIS COMPETITION France 2002/2003 - abolition of minimum capital for the S.A.R.L. The Netherlands - bill in 2006 proposing the abolition of the €18,000 minimum capital and simplification of procedures Italy - 2003 reform increasing flexibility Germany - proposal to reduce minimum capital to €10,000 or less

3. LIMITEDS IN GERMANY Finanzamt Hannover-Nord unofficial estimate – 20,000 Limiteds tax registered in Germany at end of 2006 Go Ahead Limited, claims more than 28,000 incorporations of Limiteds

4. REASONS FOR USING A UK PRIVATE LIMITED COMPANY i) no minimum capital ii) rapid incorporation iii) flexible structure iv) usable for wide range of purposes that do not have to be commercial or profit-making

5. COMPARISON WITH EPC Private Limited CompanyEuropean Private Company No minimum capitalMinimum capital of €10,000 but no requirement to pay this up Rapid incorporationPossibility of simple and rapid system in all Member States Flexible StructureEven more flexible structure Objects unrestricted – need not be commercial or profit-making. No need to state objects after 2007 No restrictions on objects

6. COST Go Ahead in Germany is offering a Limited for €260 In England for domestic use can buy a private limited company for as little as £24.99 (€37) Limited with a Bank Account, VAT Registration, Domain & Website in 3hrs. for £99 (€147) Jordans offer a full 1 year service including Annual reports etc. for £340 + VAT = £399 (€591).

7. ACTUAL COSTS IN GERMANY Need to have a bank account in Germany and for this you require registration of a branch in the Handelsregister Notarised copies of Memorandum and Articles of Association (Satzung) €70 each. Translations at €10 per line Could cost up to €1500 Cost of EPC could be more expensive at first but the price would inevitably come down.

8. CERTAINTY English Company Law is fairly well established, certain and predictable. Certainty and predictability are factors that have contributed strongly to the current pre-eminence of Delaware in the US New English legislation – Companies Act 2006 Problems of interpreting a new EU Regulation on the EPC

9. REPUTATION English Private Company appears to enjoy good reputation in Germany But many Limiteds used in Germany for purposes connected with insolvent G.m.b.H.s No official communication between Companies House in the UK and the German tax authorities – potential for fraud or malpractice Emphasis on economic credibility in EPC