DOKTRIN PIERCING THE CORPORATE VEIL: KETENTUAN DAN PENERAPANNYA DI INGGRIS, AUSTRALIA DAN INDONESIA

Abstract

This article discusses about provisions and application of the Piercing The Corporate Veil (PVC) doctrine in the United Kingdom, Australia and Indonesia. The main issue is when and how the courts apply the PVC doctrine, also whether the doctrine can be applied outside the courts or not. In some states such as the United Kingdom and Australia which exercise common law tradition, the courts may apply the PVC doctrine on share holders and directors when there is an exceptional circumstance which requires to apply the doctrine. Similar to both states, Indonesia, through the Indonesian Supreme Court, has already applied the doctrine long before the law on Limited Liability Company was enacted. In 1998, a unique legal case about the Liquidity Aid of Bank Indonesia shows a phenomenon that was beyond the normal understanding of the Law. In that time, the Indonesian Bank Restructuring Agency applied an out-of-court settlement model to hold shareholders' liability. Finally, this article recommends that a legal and economic study should be considered to examine the effectiveness of this approach.