As countries caught on to the benefits of limited liability corporate structures, it became necessary to protect pecuniary and non- pecuniary rights of shareholders` from the unlawful and harmful actions of the company‘s management and supervisory organs. Differences in national legislations regulating work of companies undoubtedly restrict both the natural tendencies balancing the internal market as well as the protection of the shareholders` rights. To avoid this dischord it is necessary to pay close attention to the company law harmonisation at the EC level. The purpose of law harmonisation is not only to make it easier to exercise the right of establishment found in the EC Treaty, but also to diminish the risk for violation of shareholders`, creditors` and third parties` rights caused by different company law regimes in each of the member states. The company law harmonisation programme in the EC was mostly carried out by passing secondary legislation- the directives. Regulations were passed when there was a need not only to harmonise national legislation, but also to establish transnational business entities. This paper analyses the provisions of company law directives and Societas Europaea regulation related to the protection of shareholders` rights. This paper also highlights the fact that during recent years, the reform of EC company law preceded non-binding legislation passed by the European Commission. The European Commission supports simplification and modernisation... [to full text]