It is possible, in some situations, for shareholders to be sued for the acts of a corporation. The concept is called “piercing the corporate veil.” The Supreme Court of Korea has noted that the corporate veil may be pierced and a shareholder may be sued: “Where a company maintains the external appearance of a juristic person while it merely takes the form of a juristic person and, in substance, it is equivalent to other person’s private enterprise behind the corporate veil or used without justifiable reason in order to circumvent the application of laws against the person behind the corporate veil, the denial of any responsibility of the person behind the corporate veil with respect to an action of the company, based on the ground that such person is a separate entity and the legal effect of such action is attributed only to the company, cannot be permitted. It cannot
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Korea’s Improper Solicitation and Graft Act: Kim Young-ran Act
The Improper Solicitation and Graft Act of Korea (“Graft Act”) was enacted on March of 2015 and came into effect in September of 2016. Korea’s Anti-Corruption and Civil Rights Commission published in English and Korea a decent Handbook to the Graft Act. The Handbook may be found at: Handbook to Korea’s Graft Act. All companies doing business in Korea should understand compliance basics and have an understanding of the myriad of compliance rules. The Graft Act is, only, the tip of the iceberg. We shall be focusing on Korean compliance basics over the next couple of months on this blog. The Moon Administration and the Korean FTA have aggressively acted upon alleged malfeasance in Korean companies and this is a time to consider a compliance audit, redrafting of compliance policies and procedures and, potentially, your employment rules. Please check back to the Korean Law Blog. We shall be writing over the
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