## Facts

- A Dutch company contracted with an entity using the name “Ubbink Isolatie BV,” without indicating it was a company in formation.
- The Dutch commercial register showed “Ubbink Isolatie BV io” (in formation), but no duly incorporated private limited company (BV) under that name.
- The claimant sued “Ubbink Isolatie BV” in Dutch courts seeking termination of the contract and liability findings.
- The defendant argued the action was void because “Ubbink Isolatie BV” did not exist as a legal person.
- Lower Dutch courts treated the entity as continuing to exist for litigation purposes unless and until wound up or declared null under Dutch civil code rules.
- The Dutch Supreme Court referred questions to the EU court on whether Directive 68/151/EEC limited national rules where incorporation formalities were not completed and the company was not registered as existing.

## Issues

1. Whether the nullity regime in Section III of Directive 68/151/EEC applies to acts done in the name of a purported private limited company whose existence is not confirmed in the public register because incorporation formalities were incomplete.
2. Whether, and to what extent, national law governs the legal consequences of acts done in the name of a company not yet incorporated, in light of Article 7 of Directive 68/151/EEC.

## Decision

- The court held that Section III nullity rules apply only where third parties have been led, through disclosures made under Section I, to believe that a company within the Directive exists.
- Section III does not apply where acts were performed in the name of a private limited company whose existence is not confirmed by the public register because national incorporation formalities were not completed.
- Where applicable national law treats such acts as performed for a “company being formed” within Article 7, national law must provide (consistent with Article 7) that the persons who acted are jointly and severally liable, unless the company later acquires legal personality and assumes the obligations.
- The matter returned to the referring court to resolve the dispute under Dutch law applying the EU court’s interpretation.

## Legal Principles

- The Directive’s disclosure system is the basis for third-party reliance; the Directive’s nullity limitations presuppose that the company’s existence is confirmed through required public registration and publication.
- The Directive’s restricted grounds for challenging a company’s existence (Section III) protect third parties only where the public disclosure framework has presented the company as existing.
- If a purported company is not registered as existing due to incomplete incorporation, EU nullity coordination does not constrain Member States from treating the entity as non-existent or as a company in formation.
- For pre-incorporation acts treated under national law as acts of a company being formed, Article 7 requires a regime of unlimited joint and several liability for the persons acting, unless the subsequently incorporated company assumes the obligations.

## Conclusion

The court limited the Directive’s nullity regime to duly disclosed companies and left situations involving incomplete incorporation and absent registration to national law, subject to Article 7’s requirement that those who act for a company in formation may be held jointly and severally liable.


Ubbink Isolatie BV v. Dak- en Wandtechniek BV, Case 136/87, [1988] E.C.R. 4665 (C.J.E.C. 1988)