International Law and Enterprise Shells: A Proposal for Corporate Liability Reform

Posted: 10 Sep 2014

See all articles by J.S. Nelson

J.S. Nelson

Villanova Law School; Villanova School of Business; The Wharton School, University of Pennsylvania; Institute for Corruption Studies

Date Written: September 1, 2014

Abstract

My fourth article in this series on the intracorporate conspiracy doctrine grows out of my research on the history of the doctrine and its parallels with doctrines in equity such a piercing the corporate veil and “reverse” piercing. In U.S. law, all three of these doctrines originate in the corporate parent-subsidiary context. Only later have the doctrines been interpreted to reach individual shareholders, or, in the case of reverse piercing, “corporate insiders.” By contrast, in Chinese law and other international regulatory fora, veil-piercing doctrine reaches only individuals, not corporate subsidiaries. This limitation has become a significant loop-hole for international corporations to evade liability for wrong-doing. My argument is that the conventional wisdom among academic and international regulators that the umbrella of “enterprise” liability should be expanded is exactly wrong. I argue instead that liability for enterprises should be subdivided to reach through the enterprise shell and enable regulators to penalize specific components and subsidiaries of large corporations.

Suggested Citation

Nelson, Josephine, International Law and Enterprise Shells: A Proposal for Corporate Liability Reform (September 1, 2014). Available at SSRN: https://ssrn.com/abstract=2488914

Josephine Nelson (Contact Author)

Villanova Law School ( email )

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Villanova, PA 19085
United States

Villanova School of Business ( email )

800 Lancaster Avenue
Villanova, PA 19085-1678
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The Wharton School, University of Pennsylvania ( email )

3730 Walnut Street
Room 668 Jon M. Huntsman Hall
Philadelphia, PA 19104-6340
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Institute for Corruption Studies

Stevenson Hall 425
Normal, IL 61790-4200
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