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The Misuse and Abuse of the Corporate Form

NUS - Centre for Law & Business Working Paper No. 14/04

NUS Law Working Paper No. 2014/006

17 Pages Posted: 21 May 2014 Last revised: 5 Aug 2015

Hans Tjio

National University of Singapore (NUS) - Faculty of Law

Date Written: May 21, 2014

Abstract

This paper suggests that there has been little abuse of the corporate form as a proprietary institution. What abuse as there is usually relates to the corporation being used as a unlawful wealth protection device (which should be the preserve of trusts and its perpetuity/accumulation rules) as opposed to one carrying on a business producing goods and services, or perhaps a specific stage in a company’s existence where the separate fund is violated and/or the corporate nomenclature misused in a way which benefits one corporate constituent over another. The former is met by the narrow doctrine of veil piercing and the latter by various rules that may reflect the duty to act for proper purposes, as this counteracts an appeal to the company’s best interests when this is inappropriate.

Keywords: Company law, Separate personality, Lifting the veil, Asset partitioning, Capital maintenance, Insolvency, Takeovers, Proper purposes

Suggested Citation

Tjio, Hans, The Misuse and Abuse of the Corporate Form (May 21, 2014). NUS - Centre for Law & Business Working Paper No. 14/04; NUS Law Working Paper No. 2014/006. Available at SSRN: https://ssrn.com/abstract=2439562 or http://dx.doi.org/10.2139/ssrn.2439562

Hans Tjio (Contact Author)

National University of Singapore (NUS) - Faculty of Law ( email )

469G Bukit Timah Road
Eu Tong Sen Building
Singapore, 259776
Singapore

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