The Defence of the Corporate Veil - Parent Companies Beware!

Company's veil defense - parent company is cautious. Recently, there has been great interest in the potential outcome of the judgment by Stocznia Gdanska SA-v-Latvian Shipping Company and other companies, the appellate court greatly endorsed the ruling on 21 June 2002. The case involved a shipbuilding agreement, but the result strengthened the traditional view that the court does not support any basic principles that further infringe the British company law.

This problem requires analysis of the parent company (A), and is responsible for the request of its subsidiary company. (B) In other words, whether we can unveil corporate veils in this group structure. The parent company and its subsidiary merged and was legally founded. Once the company is founded, it will be a unique law that is completely independent of the founders. The veil of the company was born by an independent legal personality and limited liability principle established by Salomon v Salomon & Co Ltd (1897). )

It is not a legal guideline to clarify the veil of the company, but there have been many legal actions in the past year. In general, according to Salomon vs. Salomon & Co Ltd AC 22, the company is another legal person whose members are legally allowed to hide behind the company. But the court can announce veil, make misconduct, hide illegal acts, due to inappropriate interests. The veil of the company seems to be fake or appearance so that the court can announce the veil. For example, the court will judge criminal responsibilities for employees of the company or injustices of directors to the company's assets.

However, if there were certain factors, the court revealed the company's limit liability claims. In order for the court to clarify the company when the subsidiary is filed suit, this will result in accountability to the parent company. Risks exist because, if they are owned and managed by the parent company, they are assets and may be used to satisfy judgment or obligation. In Missouri, the court generally believes that creditors can obtain a court order to benefit from a subsidiary, but they can not acquire ownership or influence the management of the company . Activities other than general management and supervision of subsidiaries must be restricted so that parent companies or holding companies can not accommodate them.

We will raise the company's veil to the target parent company, but it is difficult, but we usually partner. Ownership, company ownership and control are separated, and SMEs have CEO ownership and control; in partnership ownership and management are unified. All partners have the right to manage. Account; The company's account must be submitted, published and audited before the general meeting. These accounts are open to the public and the partnership account is not subject to public inspection and no audit is required; the LLP account requires the auditor's report and is sent to the company and each member every year.