British Companies Abroad

BRITISH COMPANIES ABROAD The status of British companies trading abroad, so far as Ger many, France, Belgium, Greece, Italy and Spain are concerned, is expressly recognized in a series of conventions entered into between those countries and Great Britain.

In France.—The value of the convention with France has been much impaired by the interpretation put upon the words of it by the court of cassation in La Construction Lim. According to this case the nationality of a company depends not on its place of origin but on where it has its centre of affairs, its principal estab lishment. The result is that a company registered in Britain under the Companies Acts may be transmuted by a French court into a French company in direct violation of the convention.

In Germany.—The convention with Germany, which is in similar terms to that with France, has also been narrowed by judicial construction. The "power of exercising all their rights" given by the convention to British companies has been construed to mean that a British company will be recognized as a corporate body in Germany, but it does not follow from the terms of the convention that any British company may as a matter of course establish a branch and carry on business within the German republic. It must still get permission to trade and to hold land, register itself in the communal register and pay stamp duties.

Foreign companies may found an affiliated company or have a branch establishment in Italy, provided they publish their memorandum and articles and the names of their directors.

Foreign Companies Generally.

Where no convention exists the status of an immigrant corporation depends upon inter national comity, which allows foreign corporations, as it does foreign persons, to sue, to make contracts and hold real estate, in the same way as domestic corporations or citizens; provided the stranger corporation does not offend against the policy of the state in which it seeks to trade.

There is a growing practice for states to impose by express legislation conditions on foreign corporations coming to do busi ness within their territory. These conditions are mainly di rected to securing that the immigrant corporation shall make known its constitution and shall be amenable to the jurisdiction of the courts of the country where it trades. Thus, by the law of Western Australia—to take a typical instance,—a foreign com pany is not to commence or carry on business until it empowers some person to act as its attorney to sue and be sued and has an office or place of business within the State, to be approved of by the registrar, where all legal proceedings may be served. New Zealand, Manitoba and many other States have adopted similar precautions; and by the Companies (Consolidation) Act, 1908, s. 274, a foreign company having a place of business within the United Kingdom is required to file with the registrar of com panies a copy of its Charter or memorandum and articles, a list of directors, and the names and addresses of one or more persons authorized to accept service of process. Special conditions of a more stringent nature are often imposed in the case of particular classes of companies of a quasi-public character, such as banking companies, building societies or insurance companies. Regula tions of this kind are perfectly legitimate and necessary. They are in truth only an application of the law of vagrancy to cor porations, and have their analogy in the restrictions now generally imposed by states on the immigration of aliens.