Company Law Research Articles

Analyzing Astra Michael D Ruslim Education Foundation-SMK Negeri 2 Donorojo Pacitan collaboration model

This study discusses the collaboration between SMK Negeri 2 Donorojo and Astra Michael D Ruslim Education Foundation (YPA MDR) in Corporate Social Responsibility (CSR). The method used is descriptive qualitative, involving researchers as participants who collect data through interviews, observation, documentation, and Focus Group Discussion (FGD). This cooperation is based on legal basis, including the Limited Liability Company Law and the results of coordination meetings with the Pacitan District Education Office. The parties involved include YPA MDR and SMK Negeri 2 Donorojo. The objectives of the cooperation involve improving access and quality of education, community empowerment, creating community involvement, and improving the quality of the workforce. The benefits include improving the company's image, the quality of the company's human resources, and compliance with government regulations. The research concludes that this cooperation has a legal basis, clear objectives, significant benefits, and good governance.

The Existence of Individual Companies As Legal Entities In Micro and Small Enterprises In Indonesia: A Review of The Problems of The Alter Ego Doctrine

The enactment of the Job Creation Law affects the provisions of Limited Liability Companies. The mechanism for establishing an Individual Company which is explained implicitly in the Company Law and the Job Creation Law raises issues related to the process of organ responsibility in an Individual Company which states that directors can concurrently hold positions as shareholders and vice versa. One of the problems of the presence of Individual Companies in MSEs in Indonesia is the birth of Alter Ego conditions. The solution to limit the unlimited liability of corporate organs is that the government needs to strengthen and reinforce the doctrine of Piercing the Corporate Veil for Individual Companies and provide legal certainty regarding the regulation of corporate organs in the Company Law and Government Regulation No. 8 of 2021. This article examines the existence of individual companies in the context of micro and small businesses in Indonesia. The focus of the analysis lies on the concept of the alter ego doctrine which often becomes a problem in business practice. This research utilizes a document analysis approach and literature study to explore the legal and practical implications of the alter ego doctrine on individual companies in Indonesia. The analysis shows that the alter ego doctrine has a significant impact on the personal liability of micro and small business owners. The implications of these findings are discussed in the context of business regulation and legal protection for micro and small business owners in Indonesia.

Corporate Governance and Board Attributes: A Bibliometric View

Numerous high-profile corporate scandals in the 1990s—involving companies like Tyco, Enron, Arthur Anderson, Xerox, AIG Insurance, Lehman Brothers, etc.—elucidated the government's inadequacy in overseeing shareholder interests. These scandals affected markets worldwide. In order to address corporate misconduct and keep investor trust and strong performance, it is claimed that CG must be improved to a "sound" quality. Some well-known examples include the US Sarbanes-Oxley Act, the recommendations for corporations made by the EU Cadbury Committee, and the corporate governance standards set out by the OECD. First and foremost, the Cadbury Committee (1992) supported exposure as "a medium for responsibility," highlighting the need to increase reporting requirements to prevent regulatory complications. " But instead of trying to pin it down, they summed it up as "the ability for investors and others to assess companies' performance and governance practice and respond in an informed way"—commercial gest. "Guidance on Good Practices in Corporate Governance Disclosure" (OGCD, 2006) specifies that any major issues with the company's CG should be disclosed promptly. The "substance over form" principle dictates that the exposure be brief, precise, and easy to understand. As a result of these "new" developments, businesses are being pressured to follow "sharpe practice" requirements, claims Dragmore (2009). Reporting on corporate governance and social responsibility, community across time, adding an operations report, balancing financial and non-financial information, and story reporting are all part of these rules. The quality of financial and non-financial information disclosures is influenced by "the robustness" of the reporting morals, which FASB (2001) states is the basis for disclosures of both types of information. In addition, transparency reveals the company's performance, growth strategies, client demand, and issues (Chahine and Filatotchev, 2008). Shareholders are able to evaluate the operation's effectiveness as a result of information disclosure by observing how efficiently the company's funds are being utilised to benefit the star. It is possible to examine "exposure from two perspectives: marketable exposure and financial account exposure," as Solomon (2004) brought out. Information and its disclosure are the areas where account requirements and company law intersect, according to Parker (2007). One universal element of account regulations is the importance of providing stoners with sufficient and timely information so that they can engage in the request informed.

Judicial Review of the Application of Corporate Legal Veil in Malaysia and Indonesia: A Legal Comparison

This study aims to find a comparison of the Legal Corporate Veil between Malaysia and Indonesia. This research is a normative legal research as a literature review. It is found that in corporate law both in Malaysia and Indonesia there is a principle of limited liability between shareholders and company directors known as Separate Legal Entity. This principle essentially asserts that a person's responsibility in a company is limited to their responsibility within the company and does not extend to personal liability. In Malaysia, this regulation is governed by Section 20 of the Companies Act 2016. Meanwhile, in Indonesia, this principle is scattered in the provisions of the Limited Liability Company Act (UU PT) applicable to shareholders, directors, and commissioners. However, this principle may become inapplicable in certain cases, known as Piercing The Corporate Veil. In Malaysia, this is regulated under the Companies Act 2016 as well as several judicial decisions. In Indonesia, this principle becomes inapplicable if shareholders act in bad faith by using the company for personal gain and are involved in legal actions undertaken by the Company. One form of protection from personal liability for Directors and Commissioners is implemented based on the Business Judgement Rule principle. Personal liability does not apply if Directors and Commissioners can prove that the company's loss is not due to their negligence, they have acted in good faith, have no conflict of interest, and have taken action to prevent losses. In this study, there is also corporate responsibility outside the existing Limited Liability Company Law based on business and economic developments decided by The Constitutional Court.

Regulatory Arrangement in Supporting The Restructuring of State-Owned Plantation Enterprises

The formation of a holdingholding to restructure the state-owned plantation industry cannot be separated from the government’s ability to control the country’s economic engine. Government Regulations Number 72 of 2014 and Number 72 of 2016 which were passed as legalizing the formation of BUMN holdingholding s have sparked controversy and public debate. The fundamental issue of this procedure is the Parent Company’s legal obligation to manage the Parent Company. In the relationship between parent companies and subsidiaries, the concept of limited liability presents its own problems. In addition, there is uncertainty regarding legal obligations to third parties. The research methodology is normative law which is supported and obtained from literature data. The findings of this study indicate that the use of the BUMN Law and Limited Liability Company Law as guidelines for managing Plantation BUMNs does not provide the business confidence that Plantation BUMNs need to grow and stay healthy. Considering that the business world continues to develop and the high need for group company management among business actors who carry out business development and expansion, adjustments to these two regulations are very important. The modern business paradigm has resulted in the consolidation of centralized operations in a way that drives growth. As a result, the formation of a holding companyholding company by the government is inappropriate if it is not preceded by changes to the Limited Liability Company Law which provides business certainty for established Plantation BUMNs.

Fragmentation of Application of the Personal Law of a Legal Entity in the light of the Amended Law on International Companies

The new version of Federal Law No. 290‑FZ dated 03.08.2018 «On International Companies and International Foundations» adopted in August 2023 confirms the relevance of finding ways to regulate companies incorporated in the Russian Federation. The domestic approach has no analogues because under the Russian doctrine a foreign company can move not only with its rights and obligations, but also with its corporate law. Is it possible to call the foreign law applicable in this way a personal law? Why does the law on international companies not follow the logic of the Civil Code of the Russian Federation and does not directly indicate the application of foreign law to international companies and international foundations as a personal law? Can a foreign law partially encroach on the territory of the application of personal law? Is the personal law uniform and indivisible? To answer these questions, the paper analyzes the key characteristics, as well as the novelties of the institute of personal law in relation to international companies, problems arising in this area and ways to solve them. The author concludes that with the globalization of corporate relations, the fragmentation of the scope of personal law will continue. This actualizes the problem of finding mechanisms for the «seamless» application of the norms of different states in the field of application of personal law. The author emphasizes that legislation on international companies can become a regulatory sandbox and contribute to the inclusion of the most modern and effective institutions and approaches in Russian corporate law. Proposed in the paper amendments to the Civil Code of the Russian Federation and Law No. 290‑FZ preserve the logic of current regulation and reduce the uncertainty of regulation in the field of application of the personal law of an international company, the risks of subsequent changes in legislation for participants in international companies, as well as the likelihood of conflicts in the case of reference to foreign law.

Analysis of the Board Oversight and Accountability Mechanism under UK Company Law

This paper focuses on the legal framework and the effectiveness of the board oversight and accountability mechanism within UK company law, highlighting its importance and challenges in ensuring sustainable corporate development and protecting investor interests. UK company law aims to protect stakeholders by regulating directors' behaviour, addressing issues such as conflicts of interest and inadequate information disclosure that hinder effective supervision. As remedies, this study suggests enhancing training for board members, improving information disclosure, and incorporating independent directors to mitigate conflicts of interest and increase oversight transparency and efficiency. Through case analysis, this paper further explicates the implementation outcomes and challenges faced, providing references for corporate governance improvement. Ultimately, the research underscores that refining the oversight and accountability mechanisms is crucial to elevate corporate governance standards, fostering long-term corporate prosperity.

Legal amendments on the reorganization of business entities

Legal amendments on the reorganization of business entities

Piercing the corporate veil system and creditors protection: Based on the investigation of debt paying ability--Empirical evidence from the 2005 Company Law amendment.

This paper uses the difference-in-differences model to research how the "piercing the corporate veil" system marked by the 2005 Company Law amendment affects the level of corporate creditor protection. The research results show that private enterprises and local state-owned enterprises are sensitive and significant to this legal amendment. In contrast, local state-owned enterprises are more sensitive and have a stronger motivation to protect the interests of creditors. The motivation of companies with weaker profitability for creditor protection lasts not only for the year of law revision but also extends to the year of implementation. With the law's implementation, the growth effect of creditor protection for local state-owned enterprises has become more significant. Further analysis shows that the main findings of this article are more significant in companies with larger debt scales, companies with a higher year-on-year growth rate of operating income, companies with controlling shareholders, and companies with higher stock market capitalization. From an empirical research view, this paper explains the economic effect and mechanism of the whole corporate personality under the complete system and adds economic evidence for how the law acts on the capital market.

Duty of Loyalty: Corruption of Company Directors and Prohibition of External Remuneration

39While corruption in the public sphere has traditionally been socially and legally reproached, private corruption has not. In the private sphere, the violation by a decision-maker of his or her positional duties in exchange for receiving an extra-positional benefit has not always been seen as conduct that should be prosecuted by law. However, this has changed in recent times and within the field of company law the prohibition of receiving external remuneration has emerged as one of the manifestations of the directors’ duty of loyalty. This paper examines both the basis and the elements of the prohibition and questions how far it should extend. In this sense, although it shares the convenience of enshrining the prohibition in law, it also warns about the dangers of an excessive extension of the prohibition of receiving external remuneration.

Contract Governance in the Network Economy: Implications for Company Law and Directors’ Duties

Contract Governance in the Network Economy: Implications for Company Law and Directors’ Duties

Analysis of Amendments to the Company Law of China in 2024: Discussing Adequate Capitalization and Creditor Protection

Analysis of Amendments to the Company Law of China in 2024: Discussing Adequate Capitalization and Creditor Protection

Legal Protection for Shareholders of Dissolved Insurance Companies

The capital market is the meeting place between supply and demand in trading securities, including stocks, which is proof of ownership of a company in exchange for shareholders' rights to profits or dividends. Although there are two main groups of shareholders, namely majority and minority, both groups have equal status in company ownership. To protect shareholders, capital market and limited liability company laws provide legal protection, including in cases of dissolution of insurance companies. In this research, normative legal methods were used to analyze relevant laws. The results show that shareholders' legal protection is contained in capital market and limited liability company laws, which give shareholders the right to file a lawsuit or request a company inspection if they feel aggrieved. The case of the dissolution of an insurance company by OJK shows that the institution can carry out its supervisory role and guarantee legal protection for shareholders by ensuring the company is responsible for losses incurred.

Shareholder Protection in Saudi Companies Law: Assessing Merger and Acquisition Efficacy for Unlisted Joint Stock Companies

This paper explores the legal protections afforded to shareholders of unlisted joint stock companies in Saudi Arabia during merger and acquisition activities. There are significant risks associated with using tools like mergers and acquisitions, including market share loss and decreased profitability for shareholders. Thus, this study aims to analyse the Saudi Companies Law for potential gaps that may affect shareholder legal protections. The researchers primarily use a doctrinal legal methodology to assess the legal framework. This approach provides that the study is based on an examination of the legal framework of Saudi Arabia such as statutes, rules, principles, and cases . It will also apply the analytical approach to evaluate the legal framework's fundamentals, conceptual problems, and practical effects, to make sure that the study finds opportunities for improvement. The Article identifies the differences between unlisted and listed companies concerning document disclosure requirements, lack of the method used for asset valuation, lack of forward-looking information disclosure, the absence of obligatory independent financial reports and unclear definitions of shareholder rights to oppose or exit mergers and acquisitions at fair value. The study found that these areas represent potential gaps that could undermine shareholders of unlisted joint stock, improvements to the law, such as the adoption of independent valuation standards, mandatory financial disclosures, and clearer expression of shareholder rights.

The Analysis of the Legal Issues Concerning Directors’ Liability to Third Parties Under China New Company Law

The Analysis of the Legal Issues Concerning Directors’ Liability to Third Parties Under China New Company Law

Juridical Implications of Regional Regulations on the Management of Land Management Rights that have been Incorporated in Public Companies

<em>Inbreng is a deposit of capital in forms other than money. BUMD Tbk. is a company whose capital is invested by the Regional Government Y in the form of Land Management Rights. This capital investment has been approved based on the Governor's Decree regarding Development Guidelines in the BUMD Tbk. Area, as well as giving BUMD Tbk. the right to provide recommendations on Land Management Rights. However, currently the Governor's Decree regarding Development Guidelines in the BUMD The Province of the Special Capital Region of Jakarta has the right to provide recommendations given by the Regional Government. As a result, BUMD Tbk. lost one of its income from providing recommendations. Apart from that, questions arise regarding the status of Land Management Rights which have become capital investments. Bearing in mind that BUMD Tbk. is a Public Company, BUMD This research will focus on Company Law and Capital Market Law. Especially according to the provisions of Financial Services Authority Regulation Number 42/POJK.04/2020 concerning Affiliate Transactions and Conflict of Interest Transactions and Financial Services Authority Regulation Number 17/POJK.04/2020 concerning Material Transactions and Changes in Business Activities</em>

CoC Dharma (Role of Committee of Creditors-IBC, 2016)

The Committee of Creditors (CoC) has been authorized under the IBC, similar to the Board of Directors, to make decisions concerning the corporate debtor, throughout the Corporate Insolvency Resolution Process (CIRP). As an integral part of this authorizing Code, the Adjudicating Authority, when initiating the CIRP for a company, designates a Resolution Professional, who oversees and implements all decision-making processes during the CIRP and thus administers the CIRP of the company. Within this authority, a significant aspect is the power of the CoC to review and subsequently approve a resolution plan pertaining to a company (As per sections 30 and 31 of the Code). This authorization is contingent upon the ultimate approval of the resolution plan by the respective Adjudicating Authority (Section 31 of the Code). During the Code's implementation, the Adjudicating Authority, followed by the National Company Law Appellate Tribunal and the Supreme Court of India, have consistently emphasized the “commercial wisdom” of the CoC in determining the subsequent steps for the corporate debtor thereby facilitating the resolution of the corporate debtor.

Research on the Reform of Authorized Capital System in Chinese Stock Companies: Against the Background of the Implementation of the New Company Law

With the rapid development of the Chinese economy and the continuous improvement of the market economy system, joint-stock companies, as an important form of economic organization, have gradually become the main force of economic development. In order to adapt to the new development trend, China has successively introduced a series of laws and regulations, attempting to reform and improve the authorized capital system, enhance corporate governance, protect investor rights, and promote the healthy development of the market economy. This article analyzes the current situation and problems of the statutory capital system of Chinese joint-stock companies, and based on this, analyzes the reform effects of the new Company Law on the authorized capital system of joint-stock companies. It also explores the transformation path of the authorized capital system of Chinese joint-stock companies after the implementation of the new Company Law, providing reference opinions for the development of joint-stock companies and the optimization of the efficiency of capital system reform.

Regulation of Treasury Shares in Kuwaiti Law: A Comparative Study

Treasury shares have a significant role in companies and capital markets’ regulations. As a result, it gained the attention of legislators and legal scholars. This paper examines the regulatory rules regarding treasury shares in Kuwaiti law, its philosophy, and practicality. The paper adopts a comparative, analytical approach addressing the historical evolution of treasury shares and comparing related regulations and legal provisions in many jurisdictions. With comparative law at hand, this paper aims to thoroughly examine the concept of treasure shares and their legal nature, their characteristics, buy-back procedures, treasury shares’ relation with the company’s capital structure, and ultimately, the uses of treasury shares. By analyzing Law No. 7 of 2010 Regarding the Establishment of the Capital Markets Authority and Regulating Securities Activities and Law No. 1 of 2016 Regarding Companies Law and by incorporating comparative law such as Swiss, German, Swedish, Danish and other laws, this study demonstrates different matters related to treasury shares that are not yet regulated in Kuwait. The research assesses the legal provisions governing treasury shares, addressing matters such as shareholder rights, voting power, and market manipulation concerns. It argues for regulatory reform to further enhance the provisions governing treasury shares. As a result of the analysis given, recommendations are provided to enhance the regulatory framework in Kuwait.

Penerapan keselamatan dan kesehatan kerja sebagai upaya pencegahan kecelakaan kerja di PT. Perusahaan Gas Negara (Persero) Tbk tahun 2023

Occupational Safety and Health is one way to protect workers from work accidents and dangerous risks. K3 is carried out by the company based on applicable company laws and regulations. The implementation of Occupational Safety and Health at the Pasar IX Gas Station functions to protect workers from the risk of occupational hazards at the gas station. The aim of this research is to analyze the implementation of occupational safety and health as an effort to prevent work accidents at PT. Perusahaan Gas Negara (Persero) Tbk 2023. Descriptive research method with a qualitative approach which aims to analyze the implementation of occupational safety and health at the Pasar IX Gas Station – PT. Perusahaan Gas Negara Tbk. Informants were taken using a purposive sampling technique, totaling 7 people, namely 1 HSSE person, 3 fire fighter team members, and 3 first aid team members. The selected informants are considered to be able to provide information regarding the implementation of occupational safety and health which includes K3 policies, K3 communications, K3 inspections and K3 evaluations. The research results show that the implementation of K3 at PT. Perusahaan Gas Negara Tbk has been running well and is in accordance with applicable regulations. The K3 policy is established and signed by the main director. K3 communication is carried out by HSSE to promote and inform workers to implement occupational safety and health. K3 inspections are carried out to check the condition of all equipment, work environment and worker actions. K3 evaluation is carried out by HSSE and the K3 Audit Institute to assess the extent of K3 implementation. As a research suggestion, the Pasar IX gas station operator collaborates with the Fire Department and hospitals in holding K3 training to increase awareness and knowledge of occupational safety and health among station workers.