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It's hard enough for companies to pick their way through the legal intricacies of their own domestic markets. But throw them into a different jurisdiction and the problems are exacerbated enormously. That's particularly true in the European Community, where corporate decision makers now have to live with a complex, quasi-federal mix of national and Community laws as well as some Community legislation that is standard throughout the EC but applied differently at the member-state level.
With a large and growing international practice, the law firm of Jones, Day, Reavis & Pogue has considerable experience with the legal problems that corporations are likely to face away from home. Managing partner Pat McCartan, who has CEO responsibilities, discusses some of them in this interview with Senior Writer David Fairlamb.
Institutional Investor: Do you expect that the legal relationship between companies and government will change in Europe following the launch of the single market?
McCartan: I think there will be increased regulation in the European Community, and that for the first time judicial decisions may do more to shape and structure the common market than many of the legislative or administrative measures that we have seen so far. The European Court has already intervened in some business areas such as employment legislation!, and I think that with the quasi-federal system that Europe now has, the courts are bound to be called on to arbitrate and resolve more of the problems that were previously handled by government on a member-state basis.
Does that mean Europe is effectively now a federal state from a Legal point of view?
No. I certainly do not mean to suggest that Europe is replicating the federal system of the U.S. But the European Court in now intervening more. especially in the business area, so I think it's fair to say there is a quasi-federal system in Europe and that companies need to take that into account
How will that affect companies?
At present European companies spend a lot less,...