Legal Position and Responsibility of State-Owned Enterprise Holding Companies to Third Parties for the Actions of Subsidiaries in Justice
Year: 2024
Type: article
Abstract: This paper examines the legal standing and responsibility of State-Owned Enterprise holding firms to third parties for their subsidiaries' acts under current corporate law. This paper examines corporation law's limited responsibility and breaching the corporate veil to establish substantive justice. This research also investigates how holding corporations and subsidiaries might apply the idea of fairness in their legal relationship, particularly when the holding company's strategic decisions directly affect third parties. This research employs normative legal, descriptive-normative, and juridical-analytical methods. Data are examined by studying primary legal documents like laws and regulations and secondary legal elements like academic literature and law magazines. The descriptive-normative method explains restricted responsibility and penetrating the corporate veil, whereas the juridical-analytical approach assesses holding company legal liability justice. The study found that while limited liability protects holding companies from liability for their subsidiaries' actions, the doctrine of piercing the corporate veil allows the court to penetrate this protection when abuse or unreasonable control occurs. State-owned enterprises' strategic role as the main shareholder presents challenges, so more explicit regulations and good corporate governance are needed to balance legal certainty and substantive justice for third parties. To anticipate the complexity of legal connections between holding corporations, subsidiaries, and third parties, this research suggests building an adaptable legal framework.
Author: Elisatin Ernawati
Institution: University of Brawijaya
Language: English
Field: Social Sciences
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W6949539705
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