Page 210 - Albanian law on entrepreuners and companies - text with with commentary

However, as Buchner, Schuster and Winner, recognize, with the benefit is the clear risk
for the minority shareholders in the subsidiaries and the risk for subsidiary’s’ creditors. 192 The
Buchner, Schuster and Winner Commentary was written in 2009 and includes an assessment
of the consequences of the Albanian group clauses as ‘too harsh on parent companies’. In
2015 we have a different understanding of the risks and benefits of company group situations.
Recently it is clear that large companies are using ‘Jurisdiction arbitrage’ to avoid or evade
193
liabilities. The fact that MNCs are series of companies formed in different national legal
systems and tied together in various legal ways, either by holding shares in each other or by
various legally binding agreements between them, presents genuine complexity. This
complexity, moreover, is exploited by some MNCs. There are numerous cases, for example,
of parent companies exporting dirty and dangerous business to poor countries where
regulations are minimal or not enforced; or of paying exploitatively low wages; ignoring the
194
environmental effects of corporate operations and avoiding or evading tax liabilities. This
problem is particularly acute where there are global company groups but it can happen in a
group in one country where the parent company has too much power. A parent has the power
to dissolve a subsidiary to avoid liability. There is a large international soft law movement to
try to stop any unfair practices between parents and subsidiaries. 195 Perhaps the most
influential code is the UN Guiding Principles for business and human rights 196 where the UN
It is also clear that that Albanian law is in complete regard with recent international
jurisprudence.

8. The jurisprudence of the UK and some common law jurisdictions on groups of
197
companies was settled by Adams v Cape Industries in 1990 . Several hundred employees of
the corporate group headed by Cape Industries had been awarded damages for injuries
incurred as a result of exposure to asbestos dust in the course of their employment. Many of
them were dying an unpleasant and lingering death. A court in Texas awarded the damages,
but Cape Industries had no assets in Texas, so the claimants could get no monetary

European Law, Tirana 2009, page 173.
192 Ibid
193 J. Dine, ‘Jurisdictional Arbitrage by Multinational companies’, Journal of Human Rights and the Environment, Vol 3,
No. March 2012, pp 44-69.
194 Just some of them are A. Simms, and D. Boyle, Eminent Corporations (Constable & Robinson Ltd, 2010); G.
Monbiot, Captive State: The Corporate Takeover of Britain, (Macmillan, 2000); D. Korten, When Corporations Rule
the World,(Kumarian, 1995); N. Klein, No Logo,(Picador, 1999), N. Klein, Fences and Windows (Picador, 2002); N.
Hertz, The Silent Takeover,(Heinemann, 2001); M. Chomsky, Profit over People (Seven Stories Press, 1999); G. Palast,
The Best Democracy Money Can Buy (Pluto, 2002),; B. Ehrenreich , Nickel and Dimed (Granta, 2002); E. Schlosser,
Fast Food Nation (Penguin, 2002); P. Toynbee, Hard Work (Bloomsbury, 2003); W. Hutton, The World We’re In
(Little Brown, 2002); C. Chossudovsky, The Globalisation of Poverty,(Pluto, 1998); P. Harrison, Inside the Third
rd
World, (Penguin3 ed, ,1993); M. Hertgaard, Earth Odyssey (Abacus, 1999); ‘Corporate tax avoidance by multinational
firms’, library of European Parliament 2013,
http://www.europarl.europa.eu/RegData/bibliotheque/briefing/2013/130574/LDM_BRI(2013)130574_REV1_EN.pdf,
th
accessed on 25 July 2015
195 Anker-Sørensen, Linn, Parental Liability for Externalities of Subsidiaries: Domestic and Extraterritorial Approaches
(October 7, 2014). University of Oslo Faculty of Law Research Paper No. 2014-36; Nordic & European Company Law
Working Paper No. 14-06. Available at SSRN: http://ssrn.com/abstract=2506508 or
http://dx.doi.org/10.2139/ssrn.2506508
196 http://www.ohchr.org/Documents/Publications/GuidingPrinciplesBusinessHR_EN.pdf, accessed on 25th July 2015.
197 1990 Ch. 433
209