Abstract
This paper focuses on the situation of doctrine of “piercing the corporate veil” in the current Iranian legal system especially in the Iranian Commercial Code and in the Iranian Civil Code. The author discusses the ambiguities and legal challenges which arise, directly or indirectly, from implementation of these challenges. There is also a comparative study of the doctrine with the common law system. The paper aims to highlight the defects of this doctrine in the Iranian law system and provides suggestions to improve it.
Highlights
Common law and civil law countries, there is a basic concept in business law upon which the company has been recognized as a separate legal entity
The Iranian legislator has provided some provisions in the Iranian legal system, especially in the Iranian Commercial Code that may help to protect the doctrine of “Piercing the corporate veil”
The paper examines the situation of the doctrine in the Iranian legal system and evaluates legal challenges of the application of the doctrine in the legal system
Summary
Common law and civil law countries, there is a basic concept in business law upon which the company has been recognized as a separate legal entity. The outcome of this concept is that there is a veil or mask between a company and its members including directors and shareholders. The courts, may in some circumstances and according to the law and some law principles, depart from the concept of separate legal entity, pierce the corporation veil and order that managers or directors be personally liable for debts and claims against corporation. This paper outlines bases of the doctrine of pierce of the corporation veil and circumstances upon which the doctrine may be applied. The paper examines the situation of the doctrine in the Iranian legal system and evaluates legal challenges of the application of the doctrine in the legal system
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