Removal of Limited Liability of Shareholders of Limited Companies Through the Principle of Piercing The Corporate Veil
Keywords:
Piercing the Corporare Veil, Limited Liability, Shareholders, Limited Liability CompanyAbstract
The limited liability of shareholders has been regulated in Article 3 paragraph (1) of the Company Law 2007 where the shareholders of the Company a r e not personally liable for the agreements made on behalf of the Company and are not responsible for the Company's losses exceeding the shares owned. However, this right is not absolute, considering the many bad intentions of shareholders in running the company, theprinciple of piercing the corporate veil is intended to prevent the abuse of legal protection given toshareholders based on the principle of limited liability. The method in this research is normative legal research method with the focus of the study discussing the doctrines or principles of law. The result of this research is based on the principle of piercing the corporate veil which eliminates limited liability into unlimited liability in a Limited Liability Company, this has also been regulated in Article 3 paragraph (2) of Law Number 40 of 2007 concerning Limited Liability Companies which states that in certain cases the possibility of eliminating limited liability is not closed. Shareholders assume the risk together with the Company to pay the Company's debts from the personal assets of the shareholders concerned.
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