(FRANKFURT) - German firms BASF and Porsche have boosted European industrial integration by advancing toward, and in the latter case attaining, the statute of Societas Europaea (SE), or European Company.

"The trend is definitely set," industrial specialist Jerome Chauvin at the Brussels-based European business confederation BUSINESSEUROPE told AFP.

BASF said last week it had signed an accord with worker representatives that created a European works council, a crucial step in the process, while the maker of the 911 sports car crossed the finish line November 13 to become Porsche Automobil Holding SE.

Thirty three years after the pan-European statute was conceived, and three years after it took effect, a growing number of groups are mulling the benefits of a single corporate entity that covers 27 countries.

An SE "enables companies with subsidiaries in different member states to have a single board and a single general assembly meeting," Chauvin explained.

"This entails important savings in terms of administration, legal costs and management" and makes it easier for a company to restructure and profit from the European Union's internal market, a region of 480 million people, he noted.

"This is really nice if you want to change the location of your company or if you want subsidiaries in other EU countries," added Franz Josef Leven, an economist who runs the Deutsches Aktieninstitut, an association of listed German companies.

"It is much easier with a European Company than with an AG or Ltd or whatever," he said, in reference to the German and British abbreviations for joint stock companies.

An SE needs minimum capital of 120,000 euros (175,000 dollars), so the statute is clearly aimed at larger groups, though BUSINESSEUROPE hopes a future European Private Company statute will open the way for small and medium-sized enterprises (SMEs) as well.

Other wrinkles to be ironed out are the lack of a specific tax regime that would offer fiscal incentives, and the fact that SEs are still subject to laws that sometimes differ significantly from one country to another.

One of the major steps along the way, meanwhile, is the reconciliation of employee representation on the group's works council, and on its supervisory board, which Leven said "can be a complicated process."

According to Chauvin, "this process is very burdensome," and his group has called for it to be simplified when the statute will be reviewed.

The BASF works council will have 23 members from 12 countries.

A company statement quoted human resources director Hans-Carsten Hansen Thursday as saying that after launching talks in June, he was "pleased that we were able to complete the negotiations in such a short time."

Porsche's registration as an SE faced a legal challenge from the works committee at Volkswagen, in which Porsche holds a 31 percent stake that it is expected to raise to at least 50 percent in the near to medium term.

VW workers objected to getting three seats on the new Porsche supervisory board, at parity with Porsche workers even though the overall ratio is 29 to one.

Leven told AFP: "Its better to have smaller and more efficient boards and this is possible with European Companies," whereas German firms tend to be more top-heavy.

One of the biggest SEs created to date is German insurance giant Allianz, which registered in October 2006 as part of its integration of Italian insurer Riunione Adriatica de Sicurta (RAS).

Chauvin said the SE was a particularly apt choice for financial sector firms like banks and insurance groups as well as for service providers.

Other companies that have expressed interest include the steel giant ArcelorMittal, car maker Daimler, and aerospace group EADS.

Deutsches Aktieninstitut expects the trend to accelerate among the German blue-chip companies listed on Frankfurt's DAX 30 index.

"We think that in five to 10 years, one-third to one-half of the DAX companies will be SEs," Leven said.

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