Firms are a crucial part of the explanatory set-up of the economy. They are the dominant organisation of the modern world. Only since the nineteen twenties, economists felt the need to go beyond the market approach and develop a theory to address the reasons for the existence of the institution known as a corporation, its boundaries and its internal organization. As companies are one of the most important social and economic powers in an advanced economy, an efficient corporate legal framework is of considerable importance. This paper describes the subject "corporation" and corporate law from a European perspective. The most important characteristics of a corporation and its economic (dis)advantages, legal personality, limited liability, centralized management and free transferability ofshares, will be discussed. Also issues of the internal structure of the corporation will be analysed. Ownership structures of European companies, conflicting interests, separation of ownership and control and mechanisms mitigating the agency costs due to this separation are briefly described. The last section summarizes the agency relationship between creditors, managers and shareholders.