Academy Review (Jan 2025)
RELOCATION OF COMPANIES (ENTERPRISES): SOCIO-ECONOMIC AND LEGAL MECHANISMS
Abstract
Relocation of companies in response to extraordinary circumstances. The relocation of companies as a response to extraordinary circumstances requires an understanding of their activities from the perspective of their innovation growth rates in Ukraine and abroad, as well as their dynamic capabilities in management, coordination, and monitoring various elements of the cooperation process. In this article, relocation is considered by the authors as an integral component of companies’ (enterprises’) activities within the context of global processes. The purpose of this article is to analyze issues related to possible algorithms for a company’s response to changes in the level of threats and critical risks to its functioning, as well as the socio- economic and legal aspects of relocation implementation. A comprehensive set of general scientific and specialized research methods was used. The study is based on publications by domestic and foreign scholars, as well as the norms of current legislation in Ukraine and the EU. The authors analyzed the peculiarities of company (enterprise) relocation as a mechanism that allows a company to promptly respond to changes in external socio-economic and legal factors, prospective directions for implementing relocation, and its disadvantages. An analytical examination of relocation was conducted, which manifested in several dimensions: moving the company’s production capacities both internally and across borders; relocating company personnel within diversified structural separate units; and moving the administrative management center. It is asserted that globalization, as a priority trend in global business development, manifests in expanding companies’ opportunities for cross-border relocation. Conversely, internal relocation is an effective mechanism for responding to extraordinary circumstances, such as a state of war or full-scale military invasion, while cross-border relocation is an effective mechanism in the perspective of EU inclusion and the application of relocation opportunities provided for EU member states to domestic companies. In revealing the essence of relocation mechanisms, the authors consider a complex of social, economic, and legal factors that determine the specifics of its implementation. The comprehensiveness of exploring the studied phenomenon is ensured by considering not only the advantages and objective reasons for relocation, but also the system of risks involved in its implementation, which allows asserting the situational nature of the mechanisms applied for company (enterprise) relocation. The authors of the article provide considerations regarding the basic toolkit, which could form the basis for developing directives and procedures that will regulate the company’s immediate actions after relocation.
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