Abstract
partner liability exemptions when faced with an attempt to pierce the corporate veil and attach individual liability for ongoing business decisions. The issue is that although piercing the corporate veil rule serves as an important tool for holding decision-makers accountable for misconduct in public companies and limited liability companies, the Kuwaiti legislature did not adopt this exemption If the promoter or the partner uses the company for fraudulent or illegitimate purposes, If he treats the company’s funds as his own personal funds, or if he does not separate his personal interest from the company’s interest, or if he causes incurring obligations by the company even though he certainly or purportedly knows that the company is not able to perform such obligations on their maturity, or if such obligations have been incurred due to his gross negligence or wrongdoing, if he violates the provisions of the Law or the company’s Memorandum of association or Articles of Incorporation, or if he exceeded its authority or committed fraud or gross negligence in carrying out his duties. Thus, and through the comparative-analysis method, this study seeks essentially to answer the question of whether shareholder and partner liability can be pierced under Kuwaiti law. This is achieved through an understanding the governing philosophical basis for such an exemption through analyzing the piercing of the corporate veil doctrine as it exists in the United States. Finally, this study found that an absolute limited protection on shareholder and partner liability would adversely affect potential the rights of the company’s other financial stakeholders.
Recommended Citation
Alshammari, Fahad N SH K and Alzumai, Fahad A.
(2023)
"Limiting the Shareholder and Partner Liability in Joint-Stock and Limited Liability Companies: A Comparative Study Between Kuwait and U.S Laws,"
UAEU Law Journal: Vol. 2023:
No.
96, Article 3.
Available at:
https://scholarworks.uaeu.ac.ae/sharia_and_law/vol2023/iss96/3