¹ Cf. Friedmann, Wolfgang G. and Kalmanoff, George (ed.), Joint International Business Ventures (New York: Columbia University Press, 1961), pp. 5–6Google Scholar.

² Marchal, André, “Necessity economique des fusions et concentrations intracommunautaires,” Revue du Marché commun, 01–03 1968 (No. 109), p. 31Google Scholar.

³ These motivations emerged from the interviews with executives of firms engaged in transnational collaboration ventures and are confirmed largely by a study undertaken in 1968 by the Comité européen pour le progrès économique et social (CEPES) entitledGrenzüberschreitende Untcrnehmungskpoperation in der EWG (Stuttgart: Forkel Verlag, 1968), pp. 29, 149–157Google Scholar. In this study 1448 cases of transnational business collaboration in Western Europe have been analyzed. The cases were culled from European newspapers and professional journals dating back over several years. The information received from these sources was supplemented by a number of interviews with business executives. In 1136 cases the main activity is within the Common Market, but transnational relations exist also with enterprises in non-EEC countries. Seven hundred six cases are concerned exclusively with intra-Common Market ventures. Thirty case studies are published in detail. See also Marchal, , Revue du Marché commun, No. 109, pp. 44–48Google Scholar.

⁴ For additional details see the CEPES study, pp. 33–52.

⁵ At times license exchanges or acquisitions are forerunners to production collaboration ventures.

⁶ In this venture the most prominent producers of photographic equipment in Germany and Belgium, Agfa Aktien Gesellschaft and Photo Produits Gevaerts, established in each country in 1964 two new corporations, the Agfa-Gevaerts Aktien Gesellschaft in Germany and the Gevaerts-Agfa Naanloze Venootschap in Belgium, each of which has the same capitalization and is owned equally by the founding companies. Both of the new corporations have the same management and substantially the same board of directors and have taken over all activities of the old companies. A similar arrangement has been used in 1969 for the collaboration between the Dutch airplane manufacturer, Fokker, and the German producer of planes, Vereinigte Flugtechnische Werke. The two firms together employ 20,000 workers. See Communautl européenne, 06 1969 (No. 131), p. 19Google Scholar.

⁷ Vernon, Raymond, “Economic Sovereignty at Bay,” Foreign Affairs, 10 1968 (Vol. 47, No. 1), p. 114CrossRefGoogle Scholar.

⁸ This process is a politically sensitive undertaking and requires careful balancing of activities in the countries involved.

⁹ Fortune's annual listing since 1963 of the top 200 industrial companies outside the United States.

¹⁰ These obstacles were inability to overcome the language barrier, differing conceptions of doing business, differing expectations of the monetary results of joint ventures, and fears of take-over on the part of smaller firms engaged in transnational collaboration with a larger company. For details see the CEPES study cited in footnote 3, pp. 67—73.

¹¹ In 1967 the preferred EEC countries for British marketing subsidiaries were the Netherlands, France, and Belgium-Luxembourg, respectively; for production units and financial participations they were Ger-many, Belgium-Luxembourg, and France. In 1968 the preferred EEC countries for the former category were Germany, France, and Belgium-Luxembourg and for the latter category Belgium-Luxembourg, France, and the Netherlands.

¹² In 1967 and 1968 the preferred EEC countries for all United States-established subsidiaries and financial participations were France, Germany, and Belgium-Luxembourg although the order of rank has shifted slightly from category to category and year to year. It is noteworthy that plant and equipment expenditures by Common Market affiliates of American corporations dropped from $1,437 million in 1967 to (1,194 million in 1968 but increased again to $1,584 million in 1968 (estimate). See the Department of Commerce Survey of Current Business, 09 1969 (Vol. 49, No. 9), p. 20Google Scholar.

¹³ Saclé, Robert “Cooperations-Concentrations et fusions d'entrepriscs dans la C.E.E.,” Revue du Marché commun, 01–02 1968 (No. 109), p. 116Google Scholar.

¹⁴ See footnote 3. The number of failures reported is apt to be too low since failures are rarely publicized widely. Cf. pp. 51–54 of the study.

¹⁵ Cf. also Weber, A. P., “Concentrations en Europe,” Direction, 04 1960 (No. 160), pp. 396—397Google Scholar.

¹⁶ Cf. the CEPES study, p. 206, and Weber, , Direction, No. 160, pp. 394–395Google Scholar.

¹⁷ Cf. Balassa, Bela, The Theory of Economic Integration (Homewood, 111: Richard D. Irwin, 1961), pp. 10–14, 21–25, 102–104, 118–134, 163–167Google Scholar. Another indicator would be an increase in economic growth. See also the interesting article by Lecourt, Robert, “Concentrations et fusions d'entreprises, facteurs d'intégration europeenne,” Revue du Marché comtnun, 01—02 1968 (No. 109), pp. 6–24Google Scholar.

¹⁸ Balassa, p. 1.

¹⁹ Pinder, John, “Comecon, An East European Common Market,” paper presented at the Semaine de Bruges, 03 1969, p. 3Google Scholar. (Mimeographed.)

²⁰ Cf. Balassa, pp. 11–14. See also Tinbergen, Jan, International Economic Integration (2nd rev, ed; Amsterdam, N.Y: Elsevier, 1965), pp. 57–62Google Scholar.

²¹ Cf. Lindberg, Leon N., “The European Community as a Political System: Notes toward the Construction of a Model,” Journal of Common Market Studies, 07 1967 (Vol. 5, No. 4), pp. 344–387CrossRefGoogle Scholar.

²² When the Council of Ministers promulgates a “regulation,” it “shall be binding in its entirety and take direct effect in each Member State” (article 189, EEC treaty).

²³ For details sec Balekjian, W. H., Legal Aspects of Foreign Investment in the European Economic Community (Manchester: Manchester University Press, 1967), pp. 46–60Google Scholar.

²⁴ The Commission has recently charged that a French law of January 1969 requiring prior authorization by the French finance ministry for all investments in France by foreign companies, including those from EEC countries, violates the EEC treaty. It has taken action to bring this violation before the Court of the European Communities. (The Journal of Commerce. October 17, 1969.)

² See the interesting comments by Drancourt, Michel and LePage, Henri, “Obstacles psychologiques (et politiques) au concentrations et fusions intracommunautaires,” Revue du Marché commun, 01–03 1968 (No. 109), pp. 131–142Google Scholar. In a survey of Dutch firms engaged in one way or another in border-crossing ventures France and Italy were singled out for the politico-psychological difficulties encountered. Cf. Jong, H. W. de and Alkema, M., “Communications,” Revue du Marché commun, No. 109, pp. 143–155Google Scholar. These difficulties as well as the sociopsychological difficulty referred to in footnote 10 have encouraged national collaborations, thereby playing into the hands of the member governments.

²⁶ No data is available for the number of refusals. In important cases as reported in the following pages the press uncovers them; in other cases the prospective partners may prefer to keep their unsuccessful efforts for collaboration hidden from any publicity.

²⁷ International Herald Tribune, October 9, 1968, and he monde, October 1, 1968.

²⁸ International Herald Tribune, October 5–6, 6–7, and 13–14, 1968.

²⁹ he monde, October 11 and 12, 1968.

³⁰ International Herald Tribune, October 12–13, 1968, and he monde, October 12, 1968.

³¹ he monde, October 5, 13–14, and 27–28, 1968.

³² International Herald Tribune, October 29, 1968. In response to the apprehension expressed by French labor unions mentioned earlier that Citroen would cut its work force or that an Italian-controlled company would give priority to the employment of Italian labor a communiqué issued by Citroën and Fïat pointed out that the collaboration of the two firms should permit an increase of their competitive position which was the sole guarantee of the stability of employment and future growth. (Le monde, October 27–28, 1968.)

³³ Cf. he monde de léconomie, February 11, 1969, for an interesting and detailed account of the CFP-GBAG affair.

³⁴ Report of the Commission Regarding the Activities of the Communities 1968 (Brussels-Luxembourg, 02 1969)Google Scholar, paragraphs 144 and 145.

³⁵ Agenee europe bulletin, March 27, 1969.

³⁶ It is noteworthy that the German antitrust agency (Kartellamt) recently pronounced itself in favor of controlling all mergers and the German government may well share this view. It based its position on the assumption that optimum production conditions may often be found in medium-sized enterprises and that the superiority of large firms in research and development is not confirmed. (Agenee europe bulletin, June 4 and 18, 1969.)

³⁷ Agenee europe bulletin, June 19, 1969.

³⁸ Perhaps one indication is the declaration of the president of the powerful Société générale de banque (Belgium), a firm strongly engaged in transnational activities, urging the integration of the capital markets of the six. (Agenee europe bulletin, April 22, 1969.)

³⁸ These major objectives are suggested by the CEPES study and survey cited in footnote 3 and are in general confirmed by the interviews and conversations of the author and by Jong, de and Alkema, , Revue du Marché cotnmun, No. 109, p. 156Google Scholar. Collaborating firms are naturally also interested in promoting the coordination of the economic and monetary policies of the member governments since such coordination would have beneficial effects on their collaboration ventures. However, this interest has not evolved into one of their specific major objectives. We should note that the Commission has submitted proposals for such coordination to the Council of Ministers (Agence europe bulletin, February 13, 1969). While member governments agree in principle, they also manifest various reservations and cite difficulties flowing mainly from their desire to retain their full autonomy over these policy areas.

⁴⁰ For a general discussion of tactics used by large companies in Europe and their capacity to influence governmental and community decisions see Meynaud, Jean and Sidjanski, Dusan, L'Europe des affaires: Rle et structure des groupes (Paris: Payot, 1967), pp. 129–204Google Scholar; and Feld, Werner, “National Economic Interest Groups and Policy Formation in the EEC,” Political Science Quarterly, 09 1966 (Vol. 81, No. 3), pp. 392–411CrossRefGoogle Scholar.

⁴¹ Some of the confederations seem to provide mainly a center for entertainment for visitors from the national groups with little serious work being accomplished.

⁴² Agence europe bulletin, February 1, 1969.

⁴³ See also Jong, de and Alkema, , Revue du March1e commun, No. 109, p. 156Google Scholar, whose survey of Dutch companies involved in transnational activities tends to agree with this view.

⁴⁴ Cf.Agcnce europe bulletin, October 1 and 17, 1969. The Netherlands had to impose temporary price controls after the value added tax became effective.

⁴⁵ Agcnce europe bulletin, April 21, 1969.

⁴⁶ Agence europe bulletin, May 7, 1969.

⁴⁷ Agence europe bulletin, January 16, 1969, and May 27, 1969. See also Agence Europe Document No. 519, “European Commission Guidelines on the Tax System Applicable to Shares and Interest in Debentures,” and Mailander, K. Peter, “Mergers and Acquisitions in the EEC: Problems under Corporate Tax and Antitrust Law,” New York University Journal of International Law and Politics, 04 1968 (Vol. 1, No. 11), pp. 19–36Google Scholar. For a comprehensive discussion of this problem see the reports by KaufXman, Joseph and Hutchings, Gerard, Revue du Marché commun, 01–03 1968 (No. 109), pp. 449–474Google Scholar. We should note that the last kind of disparity in fiscal laws may at times constitute also an incentive for transnational ventures in order to take advantage of a particular low tax rate in one of die member states. Collaborations in the banking field involving movements of capital and the establishment of holding companies come to mind. But most collaborations are concerned with movements of goods across borders in one way or another and dierefore full fiscal harmonization remains a preferred objective.

⁴⁸ Agence europe bulletin, March 26, 1969. As far as standards for pharmaceutical products are concerned, the council had already adopted a harmonization directive in 1965, but this directive has not been implemented by some of the member governments(Agence europe bulletin, April 18, 1969).

⁴⁹ Some progress has been made in the spring of 1969 in the harmonization of national customs regulations after many efforts dating back to 1962 had failed. The EEC Council of Ministers adopted a number of directives for the member governments which constitute, when translated into national legislation, at least the beginning of a “European” customs code. SeeLe monde, March 4, 1969.

⁵⁰ Agence europe bulletin, March 3 and 5, 1969. For details of the planned conventions seeAgence europe bulletin, February 12, 1969. For a discussion of a related problem, the harmonization of trademark laws, see Wertheimer, H. W., “The Principle of Territoriality in the Trademark Law of the Common Market Countries,” The International and Comparative Law Quarterly, 07 1967 (Vol. 16, No. 3), pp. 630–662CrossRefGoogle Scholar.

⁵¹ For additional information see Mailander, , New York University Journal of International Law and Politics, Vol. I, No. 1, pp. 22–26Google Scholar, and the CEPES study cited in footnote 3, pp. 191–195.

⁵² Cf.he monde, December 6 and 7, 1968, Der Spiegel, 10 28, 1968 (22nd Year, No. 44), pp. 46–70Google Scholar, and Vetter, Heinz O., “Mitbestimmung ist Fortschritt,” Europäische Gemeinschaft, 09 1968, pp. 5–7Google Scholar. The Italian labor unions oppose the labor participation provisions because they consider “sitting on both sides of die fence” would reduce their bargaining power.

⁵³ Journal officiel des Communautés europiennes, No. C75, July 29, 1968. See also the Report of the Commission Regarding the Activities of the Communities 1968, paragraphs 22–33.

⁵⁴ For an analysis of pertinent Commission decisions see Waelbroeck, Michel, “Cooperation Agreements and Competition Policy in the EEC,” New York University Journal of International Law and Politics, 04 1968 (Vol. 1, No. 1), pp. 5–18Google Scholar. Cf. also Meynaud and Sidjanski, pp. 58–69. An additional problem for transnational collaboration stems from the double application of community and national antitrust provisions where the latter exist. For example, Germany pursues the “doctrine of two barriers” and some-times the German antitrust provisions tend to be more restrictive than the application of the community provisions. German firms engaged in transnational collaboration would like to see the community antitrust law be predominant.

⁵⁵ See Phlips, Louis, “Effets économiques de la concentration industrielle: Essai d'analyse empirique,” 1969Google Scholar. (Mimeographed.) And Jong, H. W. de “De Concentratiebeweging in de Westeuropese Economie,” Economisch-Statistische Bcrichten, 01 22 and 29 and February 5 and 12, 1969, especially Table 3Google Scholar.

⁵⁶ The number of employees of fifteen EEC-based enterprises engaged in transnational ventures of different types that are listed among the 50 largest corporations outside the United States totals a respectable 2,074,931. Fortune, 08 15, 1969 (Vol. 80, No. 3), p. 107Google Scholar. The total civilian labor force in the EEC is nearly 74 million.

⁵⁷ See Pamphilis, Nicola de, “Azione sindicale e concentrazioni industriali,” Conquiste del lavoro, 11 18–24, 1968 (Vol. 21, No. 47), p. 7Google Scholar.

⁵⁸ These topics were discussed, for example, during meetings held in 1967 and 1969 between Christian and Socialist unions and management staff members of Philips. Agence europe bulletin, July 4, 1969. In 1968 an agreement was concluded between the EEC Comite des organisations professionelles agricoles•(COPA) and the Christian and Socialist union confederations which covers working hours and rest,-periods of agricultural workers. See European Community, 06 1969 (No. 124), p. 18Google Scholar.

⁵⁹ International Herald Tribune, January 17, 1969.

⁶⁰ L'express, 12 9–15, 1968 (No. 909)Google Scholar.

⁶¹ The committees of Agfa-Gevaert meet at a motel midway between the locations of their respective.headquarters. Significantly, the name of the motel is Euromotel.

⁶² See Dawson, Richard E. and Prewitt, Kenneth, Political Socialization: An Analytic Study (Boston: Litde, Brown and Co., 1969), pp. 38–39Google Scholar, and Almond, Gabriel A. and Verba, Sidney, An Analytic Study, Civic Culture: Political Attitudes and Democracy in Five Nations (Boston: Little, Brown and Co., 1965), pp. 266–306Google Scholar. Individuals socializing themselves adopt, thereby, new values and beliefs of a political nature.

⁶³ Cf.Le monde, October 15, 1968. Private shareholders of Montecatini-Edison continue to oppose the take-over but with only limited success. SeeFrankfurter Allgemeine Zeitung, April 29, 1969.

⁶⁴ Cf. Loch, Theo M., “Warten auf ein Wunder,”Europäische Gemeinschaft, 10 1969, pp. 4–5Google Scholar, and Herbert Kriedemann, “Die Gemeinschaft ist in grössten Bedrängnis,” ibid., pp. 6–7. The attitude of national civil servants is highly complex and should be a fruitful field for further research. Officials in the EEC countries (except France and Italy) with whom the author had conversations stressed at first their support for European unification. But later in the conversations a variety of reservations and objections appeared, almost reversing their first views.

⁶⁵ A“Phrasen schaffen kein Europa,” Europäische Gemeinschajt, 12 1968, pp. 3–4. It is note-worthy that in Germany young officials are beginning to be interested in being assigned to ministerial sections dealing with European questions. This may suggest a slow change of bureaucratic attitudes.

⁶⁶ Suddeutsche Zeitung, June 20, 1969.

⁶⁷ J. K. De Vree, “Le theme europeen dans Ies elections générales de 1967 au Pays-Bas,” Europa Institute of the University of Amsterdam. (Mimeographed.) And JÁger, Alfred, “Das Thema ‘Europa’ im Bundestagswahlkampf,” Forschungsinstitut fur politische Wissenschaft und europäische Fragen an der Universität zu Köln, 1965. (Mimeographed.)Google Scholar

⁶⁸ It is noteworthy that the strong backing of European unity prominendy displayed in the election program of French presidential candidate Alain Poher, announced six days before the first election ru n in 1969, did not gain him additional votes; in fact, his percentage of votes received during this election run was substantially lower than that indicated in the public opinion polls taken just prior to the announce-ment aldiough no causality between the announcement and the poor election result can be assumed. Cf.Le monde, May 28, 1968, andLe soir, June 2, 1969.

A number of new parties dedicated chiefly to European unification have sprung up during the last few years, but diey have been able to attract only a tiny number of voters. For an account of two such creations, the Europa Partei and the Parti socialiste europeen, seeAgence europe bulletin, May 19, 1969. In the West German elections of September 1969 the Europa Partei received less than 0.5 percent of the votes cast.

⁶⁹ Cf. Gingembre, M. L., “La creation à'éntreprises a l'echelle européenne: L'avenir des petites et moyennes entreprises,” paper presented at a colloquium held at the Free University in Brussels, 10 1968.Google Scholar(Mimeographed.)

⁷⁰ Haas, Ernst B., The Uniting of Europe: Political, Social and Economic Forces, 1950–1957 (Stanford, Calif: Stanford University Press, 1968), p. xxxiiiGoogle Scholar.

⁷¹ Important examples are the collaboration agreements between l'Union chimique beige, the Dutch chemical group Algemene kunstzijde unie (AKU), and the German Glanzstoff Aktien Gesellschaft; the Dutch steel maker Hoogovens and the German steel firm of Hösch; and Fokker Aircraft of the Netherlands and Vereinigte Flugtechnische Werke of Bremen, Germany. SeeLe monde, March 16–17, 1969. Agence eiirope bulletin, March 24, 1969, International Herald Tribune, May 13, 1969, andSüddeutsche Zeitung, July 17, 1969. However, national collaborations and mergers also continue to show a very strong trend. Recent examples are the Volkswagen-Neckarsulmer Motorenwerke merger and the RhonePoulenc acquisitions(International Herald Tribune, June 10, 1969). For explanations of this phenomenon see H. W. de Jong, “Specialisation, concentrations et Marche commun,”Revue de I'economie du CentreEst, 04–06 1968 (Vol. 10, No. 40), pp. 195–213, especially p. 197Google Scholar, and Jürgensen, Harald and Berg, Hartmut, Konzentration und Wettbewerb im Gemeinsamen Markt-Das Beispel der Automobilindustrie (Wirtschaftspolitische Studien 12) (Gottingen: Vanderhök & Ruprecht, 1968)Google Scholar.