Abstract

This article uses an Economic Analysis of Law approach to propose the adoption of the doctrine of corporate veil piercing in Mexico. This study not only recognizes the economic benefits of limited liability for society, but also identifies the incentives it creates for shareholders to abuse of the corporate form by using the corporation to unduly appropriate a corporation’s assets at the expense of the corporation’s creditors. On this basis, the article describes the American equity doctrine of veil piercing that courts apply in order to reach shareholders’ assets in cases of fraud or misconduct against the corporation’s creditors. Finally, the paper describes the current legal framework in Mexico and proposes the adoption of corporate veil piercing in the Mexican legal system.

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