Multinational Group Liability and Directors’ Duties

Oxford University Press eBooks, pp. 300–335

Abstract

Abstract This chapter addresses the impact of the multinational enterprise (MNE) group on company law, considering the themes of corporate control and liability. The existence of group enterprises challenges the basic legal characteristics of the corporation: separate legal personality; directors’ duties to the company; the integrity of corporate capital; and protection of shareholders against liability for corporate debts. Corporate legal separation also hides the underlying group enterprise, reducing accountability for group actions and impacting various classes of potential claimants. The chapter then offers a historical analysis of the corporate legal form as a regulatory device for transnational corporate groups. It looks at the limits of group liability towards voluntary and involuntary creditors in equity-based groups, and in contract-based transnational network enterprises. The chapter also discusses reforms that could enhance MNE group liability and examines the group liability of directors, covering protection of minority shareholders in subsidiaries and compensation of creditors on the insolvency of affiliates.

Authors 2

1. Peter Muchlinski corresponding

   University of London · SOAS University of London

   Affiliation as printed

   School of Oriental and African Studies, University of London

2. Ebbe Rogge Aachen

   Leiden University

   Affiliation as printed

   Leiden University