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40 Comm. L. World Rev. 207 (2011)
The Lifting of Corporate Veil Doctrine in Hong Kong: An Empirical, Comparative and Development Perspective

handle is hein.journals/comlwr40 and id is 213 raw text is: The Lifting of Corporate Veil Doctrine in Hong Kong: An Empirical, Comparative and Development Perspective Thomas K. Cheng* Abstract: This paper provides an empirical, comparative, and devel- opment perspective on the corporate veil doctrine. It contains a compre- hensive survey of the corporate veil cases in Hong Kong. The survey results are then compared with comparable surveys of the US cases to highlight relevant characteristics in the Hong Kong courts' approach to the doctrine. The paper also analyses the doctrine and the limited liabil- ity principle in a development perspective to suggest that the Hong Kong courts should apply the doctrine more assertively to address externalization of corporate business costs, which is the inevitable con- sequence of limited liability. Keywords: company law, lifting of corporate veil, limited liability, Hong Kong, comparative I. Introduction The lifting of corporate veil doctrine remains one of the most difficult areas of Hong Kong company law. There is a dearth of overarching guiding principles for a body of largely incoherent case law.' On the one hand, some of the leading cases, such as China Ocean Shipping v Mitrans Shipping' and Bakri Bunker Trading v The Neptune,3 suggest that Hong Kong courts share the reservations of the English courts towards the doctrine. On the other hand, the courts readily applied the doctrine to achieve justice in a number of cases. In addition, the Hong Kong courts have shown a conflicting attitude regarding the * BA (Yale), JD (Harvard), BCL (Oxon); Attorney & Counsellor, New York State; Assistant Professor, Faculty of Law, the University of Hong Kong; e-mail: thomas k cheng@yahoo.com. The author wishes to acknowledge the able research assistance of Alex Lee and Ginny Ng in compiling the survey of Hong Kong corporate veil cases. This paper would not have been possible without them. 1 One Hong Kong commentator noted that '[i]t is, however, difficult to state precisely when the courts will do so in a particular case and there is no precise test or criteria upon which the courts may rely': P. Kwan, Hong Kong Corporate Law, 1st edn (Lexis-Nexis: Hong Kong, 2006) 88. 2 [1995] 3 HKC 123, HKCA. 3 [1986] HKLR 345, HKC. Common Law World Review 40 (2011) 207-234 DOI: 10.1350/clwr.2011.40.3.0219 207