Legal Analysis of the Companies Incorporated Abroad by National Iranian Oil Company

Abstract

Generally speaking, the commercial companies that registered in any country are governed by the laws and regulations of the place of incorporation. However, this general maxim may face with some opponents which believe that in case of governmental companies, there should be special consideration. Governmental companies which are those companies that 50 or more that 50 percent of their shares are owned and controlled by government itself or governmental companies, are being established by law. These companies if registered abroad, will lead to a legal discussion for determining the applicable laws and regulations. There is an idea that only laws and regulations of place of registration will apply on the governmental company that is registered outside of a country based on the general principles of law. However, the governmental companies have special nature because they are created by laws and they use from the public capital. Therefore, while they should apply the laws and regulation of place of registration, mandatory rules of laws and regulations of the related government still are applicable to them and governmental companies cannot evade from application of these rules with the justification of being registered abroad.