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Durham University

Durham Law School

Staff profile

Publication details for Dr Jonathan Mukwiri

Mukwiri, Jonathan (2013). Free Movement of Capital and Takeovers: a case-study of the tension between primary and secondary EU legislation. European Law Review 38(6): 829-847.

Author(s) from Durham


One of the objectives of the Takeover Directive is to reinforce the single market by enabling
the free movement of capital throughout the European Union. This requires takeover rules to
be in harmony with capital movement rules, yet both 2007 and 2012 European Commission
reports reveal a continuing tension. While art.63 TFEU prohibits obstacles to free movement
of capital, art.12 of the Directive makes the removal of obstacles that would frustrate takeover
bids optional. In order to harmonise takeovers with free movement of capital, this article
examines the extent to which the tension between capital movement and takeover rules could
potentially be resolved with negative integration. The conclusion is that negative integration
could resolve tension. However, the suggestion is made that strict negative integration is
inadvisable since there seems to be a lack of political will in Member States to eliminate
takeover obstacles and an uncertain economic situation in the European Union at present.