Veil of incorporation

Hi

Lifting the veil is an option where, for example, it is believed that the true purpose of a company's formation differs from the declared purpose on incorporation.

A disqualified director participating in management is a statutory offence (not common law) and could result in that 'director' being held personally liable.

Similarly, a public company trading without a trading certificate is also a statutory offence (not common law) and opens the directors to the prospect of personal liability.

I struggled with the wording of option (c). If a company is set up for a 'clearly fraudulent purpose', I had to ask myself 'Why was it registered?' For example 'The company is set up for the purpose of increasing the number of opportunities for the directors to indulge in money laundering' - that would be for a 'clearly fraudulent purpose'. I don't like the wording of the option!

But, given that the other two options are statutory offences rather than common law matters, the correct option has to be the 'clearly fraudulent purpose' option.

OK?

You helped me understand this part completely and really made it click for me. The answer is clear now. Thank you so much, Sir!

You're very welcome. Post again whenever you feel the need

OK?

Okay of course :)

:-)