Piercing the Corporate Veil

The concept commonly known as “piercing the corporate veil” refers to cases where legal boundaries between individual and corporate responsibilities blur. This Guide explores the complexities of corporate accountability, analyzing how different legal systems can address the challenges posed by the misuse of corporate structures.

The authors describe how legal frameworks respond to situations where individuals or entities exploit corporate structures, often leading to scenarios of asset confusion and legal complications. It emphasizes the importance of compliance and formalities in company incorporation and how these aspects differ significantly across various types of companies and jurisdictions. A significant focus is placed on the limitations of the corporate shield and the circumstances under which shareholders and directors can be held accountable beyond their immediate corporate roles.

Furthermore, the Guide highlights the nuanced responsibilities of de facto directors and hidden partners, particularly in contexts of insolvency. It also addresses how these principles apply to groups of companies, underscoring the importance of curbing abuses of power and promoting good governance."