Appraising the New EU Appraisal Regime

In 2019 the European Union adopted the Mobility Directive(Directive (EU) 2019/2121 of the European Parliament and of the Council of 27 November 2019 amending Directive (EU) 2017/1132 as regards cross-border conversions, mergers and divisions OJ L 321, 12 December 2019, pages 1–44), which improved the rules governing cross-border mergers and introduced harmonized rules for cross-border conversions and cross-border divisions. Most notably, the Directive introduced a harmonized regime for the exercise of appraisal rights in case of crossborder mergers. The new rules, which significantly strengthen minority shareholder protection, are in line with the EU’s goal of fostering capital markets. The present article will seek to analyse the new appraisal regime introduced by the Mobility Directive and offer an evaluation of the regime and its shortcomings. Part I of this article will offer an introducing to appraisal rights and appraisal litigation and examine whether long-standing fears regarding abuse of appraisal rights are justified. Part II will set out the new appraisal regime, while Part III will offer an evaluation of the new provisions and discuss their shortcomings.