Objective to Subjective Test: Piercing the Veils of Corporate Members in Companies Groups
佟刚
【关键词】英国法；揭开公司面纱制度
【全文】
(Content)
Introduction
Disregard of legal personalities within a company group is of a somewhat particular nature for the shareholder of the subsidiaries is a corporate entity rather than a natural person. Accordingly, there are more tests developed than that of a single corporate entity; however, the standard of application is no less strict at all.
Definition of company groups
Statutory definitions, clear under ss258 and 259 of CA 1985, describe such legal relationship between holding or parent company and its subsidiary as within any one of the following four kinds of controls: by holding more than half of voting rights at a general meeting; or by having right to appoint or remove more than half of the directors at board meeting; or by being a member and controlling more than half of voting rights at a general meeting under agreements with other shareholders; or sub-subsidiary one. Accordingly, scholars divide groups into two categories: legally vertical groups which consist of a parent and one or more subsidiaries and legally horizontal groups which are made up of companies with cross-shareholdings.[1] Company group in practice is undoubtedly commonplace and dominating. Various reasons for the establishment of associated companies can be listed, such as taxation advantages and running a risky business.
Individual corporate personalities in a company group
Legal corporate personality established by Salomon precedent, as a common and binding sense, is also applicable to individual entities in a company group. Each company, per Roskill LJ, in a group of companies is a separate legal entity possessed of separate legal rights and liabilities.[2] That is to say, despite the fact that the disposal rights of property in subsidiaries are restricted in practice as a result of parent company''s control, that holding or parent companies and their subsidiaries or sub-subsidiaries have such independent personalities as followed:
1) They can sue or be sued in their own name.
2) They will not be liable for the other parties'' debts or obligations in contract or tort nor can the parent or holding company bring an action to enforce rights belonging to its subsidiaries for privity of contract, and vice versa.
