Hungarian Lifting veil of incorporation However, the veil of incorporation can lift by statutory exceptions. Under statutory exceptions, there have some situations show that the veil of incorporated can be lifted. Firstly, under section 36 of company act, 1965, the veil of incorporation can lift when the number of members are below 2 persons. According to Concise Principles Of Companies, page 26[When a company have the members which are below two, the company still can operating its businesses within 6 month, but after 6 months, he member is responsible for all debts belong to the company].
According to Company Law In Malaysia, page 23[Len usual, the reduction of members can due to the death of members, transfer or sell shares of company to others. Case law: Wong Kim Fat V Leone & Nor (1976)]. Secondly, under section 119(1) of company acts, 1965, a company should have registered office wealth Malaysia, when It begin to operate their businesses or fourteen days after Its Incorporation.
According to company act and regulation,2008 edition, page 133 [Otherwise, all communications and notices bout the business should be state and announce to public and announce to public that the minimum daily operating hours of the business are three hours, except for Saturday, Sunday, or holidays. If the officers of the company are default and found guilty of an offence against this act, they will fine Rammer. Thirdly, Section 121(1) of company acts, 1965, requires a company to incorporate its name and number in its documents egg. Register private or public company, capital to start business and the details of directors of the company.
This is to prevent company from committing raid. So, the officers of the company should compliance this requirements. Under section 1 21 (2) of company acts, 1965, according to company law, second edition, page 53,54 state [on behalf of company, the officer of the company who sign, issue or authorize any bills of exchange, promissory notes, cheeses, negotiable instruments, endorsements and orders]. If the officer do not sign those documents under company’s name, then the officer is liable to the holder of the bills, unless the company agree to the bills.
According to company act and regulation,2008 edition, age 61 [Section 45 (1) of the companies act , 1965 state prospectus inviting subscription for or purchase of shares in or debentures of a corporation and Including a statement purporting to be made by an expert or to be based shall not Issue] unless he has given and has not before delivery of a copy of the prospectus for registration register, he has written consent to the Issue thereof with the statement Included in the form and context in which It Is Included and the prospectus that he given did not show that he has withdrawn his consent.
Section 45(2) of company acts, 965 state If any prospectus Is Issued against this section and the person Issue shall be guilty of an offence against this act and penalty Is Imprisonment for five years or fine one hundred thousand ringing. Besides, under section 46(1) of company acts, 1965 state that, If the customers who buy any shares or debentures on believe of the prospectus and due to the untrue statement or the officers purposely non-Dolores any matter that he know and material, as well as cause customers to suffer lost and damage, the officers are liable to their customers.
The officers who are liable include retired or not. Besides, the director who approve the untrue statement should be liable also. Otherwise, the promoter of corporation as well. The name of directors on the untrue statement also liable. Under section(2) of company acts, 1965, state that the notwithstanding anything in section 46(1) of company acts, 1965, the issue of the prospectus is required consent by the expert.
According to company act and regulation,2008 edition page 61 [the expert is liable when they authorize and approve he prospectus except the untrue statement have purporting to be made by him have include the name of banker, auditor and trustee for debenture holders, then he is not only the person should liable on issue of the prospectus. ] Under section 46(3) of company acts, 1965, no person shall be so liable if the director of the company have show that he is not consent before issue of the prospectus and the issue is not under his approved.
In addition, according to company act and regulation, 2008 edition page 62[the officer not so liable when the prospectus is issue without his agree and e announces to public immediately after he notice]. In other situation is the director of company already issue the prospectus and before allotment(allotment means the customer buy shares or debentures from company),and the director realize the untrue statement and he has withdraw his consent in a Jiffy.
Additionally, not every untrue statement are to be made on the authority of an expert public official document, so the director had the reason to believe the statement is true at the time of allotment or sale the shares. According to company act and regulation,2008 edition age 62 [The untrue statement maybe made by expert or based to the statement which create by an expert, or extract copy from the report and the director have reasonable to believe the prospectus].
According to company act and regulation, 2008 edition page 62[The directors has also believe the competent of the expert to make it and the person has given the consent required by section to the issue of prospectus and not yet withdrawn that consent before delivery of the copy of prospectus for registration or to the person’s knowledge ,before any allotment or sale here under].
Regarding to the every untrue statement that made by expert or comprise extract from public official document, it had corrected represent the untrue statement are really extract from the document without change of its details. Section 46(4) state that subsection three may not use in the case of a person liable, his have given a consent required of him by section 45,when a person who has authorized or caused the issue of the prospectus in respect of an untrue statement purporting to have been made by him as an expert.
Otherwise, According to company act and exultation, 2008 edition page 63 [under section 46(5) a person who have not so liable when he authorized the issue of a prospectus in respect of an untrue statement if he proves that he have given a consent required by section 45, to issue of the prospectus, and he have cancel it in writing before a copy of the prospectus was lodged with the register].
Besides, after the prospectus have already been register and before the allotment or sale there under, the officer Just realize the untrue statement, and he has withdrew his consent in writing and announce to the public of he withdrawal and reason there for.
Besides that, according to company act and regulation,2008 edition page 63 [the officer was competent to make the statement and that he had reasonable ground to believe to the time of allotment or sale of the act and regulation,2008 edition page 63, under section 46 (6) of company acts, 1965, state that the prospectus contains the name of a person as a director of the corporation, and he has reject to become a director or withdrawn his consent before the issue of the prospectus and has not authorized or approved to the issue].
In edition, the consent of a person is required under section 45 to the issue of the prospectus and when he is not given that consent or has withdrawn it before the issue of the prospectus, and then the issue of the prospectus still issue out without his acknowledge or consent, and any other person who authorize the issue thereof shall be all liable to compensate the person so named and is in charge of all damages, cost, and expenses to which he may be made liable by reason of his name having been inserted in the prospectus or inclusion of a statement purporting to be made by him as an expert.
