Piercing the Corporate Veil
Its Recognition and Application in Ethiopia
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Company law is a complex and fascinating area of law. The attributes of separate legal personality and limited liability of a company makes it a preferable medium to engage in business, for it provides protection to the individual share holders from the reach of outsiders. Nonetheless, the protection is not meant to justify the use of the company s separate legal personality and limited liability for illegitimate and unlawful purposes, in which case the protective veil will be pierced and individual members will be held liable. Even though the principle of piercing the corporate veil got its o...
Company law is a complex and fascinating area of law. The attributes of separate legal personality and limited liability of a company makes it a preferable medium to engage in business, for it provides protection to the individual share holders from the reach of outsiders. Nonetheless, the protection is not meant to justify the use of the company s separate legal personality and limited liability for illegitimate and unlawful purposes, in which case the protective veil will be pierced and individual members will be held liable. Even though the principle of piercing the corporate veil got its origin in the common law legal system, the author examines the legal as well as the judicial recognition of the principle in the Ethiopian legal system. His book thus explores the possible grounds by which the veil of the company may be pierced under the Ethiopian company law, and the role of the Ethiopia courts in applying the principle.
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