The Corporate Personality Deny The Theory And Practice Of Exploration

Disregard of the Corporate Entity is an exception to the principle of the independent corporate personality and limited liabilities of shareholders. The New PRC Corporate Law establishes the system of Disregard of the Corporate Entity in the PRC. In this article, I propose how to implement and consummate the system of Disregard of the Corporate Entity in the PRC based on the academic study of the said system and the legislative and judicial practices and experience in western countries.The article consists of four chapters. In Chapter I, I make a brief introduction to Disregard of the Corporate Entity and point out that the independent corporate personality and limited liabilities of shareholders are the general principle of corporate law, while Disregard of the Corporate Entity is an exception. In Chapter II, I analyze the academic foundation and the applicable standard of Disregard of the Corporate Entity based on the theory and practice of"piercing the corporate veil"in the United States. In Chapter III, I retroactively review the legislative progress of Disregard of the Corporate Entity in the PRC and comment on relevant laws and regulations. In Chapter IV, I try to make practical and feasible suggestions regarding how to implement and consummate the system of Disregard of the Corporate Entity integrating the New PRC Corporate Law.I am of the view that Disregard of the Corporate Entity is designed as a judicial remedy to achieve justice and equity in case of the de facto injustice and unbalance of interest arising from the abuse of the corporate personality and limited liabilities of shareholders by controlling shareholders. Therefore, the standard of Disregard of the Corporate Entity shall be generally stipulated, and the implementing conditions of the application shall be express, specific and normative to ensure that both aims to encourage the investment and secure the transaction will be reached.