DIRECTORS' LIABILITY A WORLDWIDE REVIEW SECOND REVIEWPDF电子书下载

Part Ⅰ. Africa 1

Chapter 1 South Africa&Eric Levenstein, David Gewer, David Walker and Patrick Mayer 3

Part Ⅱ. America 17

Chapter 2 Argentina&Javier M. Petrantonio and Laura Lavia Haidempergher 19

Chapter 3 Bermuda&Peter Bubenzer and John Riihiluoma 37

Chapter 4 Brazil&Walter Douglas Stuber 49

Chapter 5 Canada&Markus Koehnen and Erin Cowling 61

Chapter 6 Cayman Islands&Antony Duckworth, Alan de Saram and Wendy Stenning 73

Chapter 7 Chile&Jaime Carey and Cristidn Eyzaguirre 81

Chapter 8 Mexico&Daniel De/Rio and Juan Jose Lopez-de-Silanes 93

Chapter 9 United States of America&Robert Ripin and Christopher Winckler 105

Part Ⅲ. Asia 119

Chapter 10 Hong Kong&Allan Leung and Danny Leung 121

Chapter 11 India&Sore Mandal 135

Chapter 12 Israel&Rachel Levitan and Yael Navon 147

Chapter 13 Japan&Norio Mitsuuchi 165

Chapter 14 Mongolia&Michael Aldrich, Byambaa Batbayar and Dashnyam Zoljargal 175

Chapter 15 The People's Republic of China&Michael Aldrich and Ke Chen 185

Chapter 16 The Russian Federation&Oxana Balayan 197

Chapter 17 Singapore&Andrew M. Lira 209

Chapter 18 Turkey&Serdar Paksoy 223

Chapter 19 United Arab Emirates&Imtiaz Shah and Charlotte Douglass 235

Chapter 20 Vietnam&Christian Schaefer and Phong Nguyen 249

Part Ⅳ. Australia and New Zealand 261

Chapter 21 Australia&Fred Chilton and Michael Scarf 263

Chapter 22 New Zealand&Jeremy Steel, Mark Williamson and Jess Hogan 277

Part Ⅴ. Europe 291

Chapter 23 The European Action Plan&Thorsten M. Volz 293

Chapter 24 Austria&Christian Dorda 303

Chapter 25 Belgium&Roel Nieuwdorp and Jens Van Hecke 315

Chapter 26 Czech Republic&Dagmar Dubecka and Martin Solc 331

Chapter 27 Denmark&Jφrgen Boe and Mads Poulsen 341

Chapter 28 Finland&Kari Lautjarvi and Riikka Leinonen 355

Chapter 29 France&Jacques Buhart 365

Chapter 30 Germany&Alexander Loos 379

Chapter 31 Ireland&Michael Greene and David Dobbyn 389

Chapter 32 Italy&Guido Brosio and Gabriele Fagnano 409

Chapter 33 Lnxembourg&Guy Harles and Saskia Konsbruck 421

Chapter 34 The Netherlands&Willem Calkoen and Martin Grablowitz 437

Chapter 35 Poland&Tomasz Zak 449

Chapter 36 Portugal&Miguel de Avillez Pereira and Bruno Sampaio Santos 461

Chapter 37 Spain&Enric Picanyol, Coro Fernandez-Ramada and Idoya Fernandez 473

Chapter 38 Sweden&Per Berglof ad Sverker Bonde 487

Chapter 39 Switzerland&Matthew T. Reiter and Felix R. Ehrat 499

Chapter 40 Ukraine&Timur Bondaryev and Pavlo Khodakovsky 513

Chapter 41 United Kingdom&Karla Dudek 527

Subject Index 541

About the Editor and the Authors 1

Preface 1

Index of Countries 1

Index of Abbreviations (Country - Abbreviation) 1

Index of Abbreviations (Abbreviation - Country) 1

Part Ⅰ. Africa 1

Chapter 1 South Africa&Eric Levenstein, David Gewer, David Walker and Patrick Mayer 3

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 3

Ⅱ. Recent Cases Dealing with Directors' Liability 5

Ⅲ. Socio-Anthropological Issues 7

Ⅳ. Corporate Governance 7

Ⅴ. Liability Issues 9

A. The Act 9

B. The New Companies Act 10

Ⅵ. Indemnification, Directors' and Officers' Insurance, Other Methods of Protection 13

A. The Act 13

B. The New Companies Act 14

Ⅶ. Lawyer Directorship 14

Ⅷ. The 'European Action Plan' 15

Part Ⅱ. America 17

Chapter 2 Argentina&Javier M. Petrantonio and Laura Lavia Haidempergher 19

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 19

A. Corporations Legal System in Argentina 19

B. Board's Authority and Structure 19

1. Rules; Meetings 20

2. Duties of the Board 20

3. Composition of the Board 21

4. Directors' Compensation 22

C. Directors' Appointment and Conditions 23

1. Election of Directors 23

2. Individuals Precluded to Be Appointed as Directors 23

D. Delegation 24

E. Removal of Directors 24

Ⅱ. Recent Cases Dealing with Directors' Liabilities 25

A. Nature of Directors' Liability 25

B. Directors' Liability and Economic Situation 25

C. Cases Related to the Administration of the Company 26

D. Delegation and Activities in Competition with the Company 26

Ⅲ. Judicial Review (Tightening of Standards?) 27

A. Directors' Liability Stems from the Sole Fact of Being a Board Member 27

B. Standard of Diligence 27

C. Damages to the Company and Liability: General Conditions 29

D. Judicial Procedure 29

Ⅲ. Corporate Governance 30

Ⅴ. Liability Issues 31

A. The Responsibility Actions Ruled by the Companies Act 31

1. Corporate Liability Action Filed by the Company ('Acci6n de Responsabilidad Social') 31

2. Corporate Liability Action Filed by Any Shareholder 31

3. Individual Responsibility Action 32

B. Limits (Caps) and Statutory Limitations 32

C. Directors' Joint Liability 33

D. Relevance of Bankruptcy with Regard to Bringing a Directors' Liability Action 33

E. Costs and Fees in Liability Litigation 34

Ⅵ. Indemnification 34

Ⅶ. Directors' and Officers' Insurance 34

Ⅷ. Lawyer Directorship 35

Ⅸ. Forecast on Future Legislation Development 35

Chapter 3 Bermuda&Peter Bubenzer and John Riihiluoma 37

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 37

A. Role of Chairman and CEO 38

B. Board Structures 38

C. Directors' Election 39

D. Delegation 39

E. Removal of Directors 40

Ⅱ. Recent Cases Dealing with Directors' Liability 40

Ⅲ. Judicial Review 41

Ⅳ. Typical Approach to Avoid Directors' Liability 41

A. Composition of the Board 41

1. Are the Decision-Making Mechanisms Changing? 41

2. Board/Management Relationship 41

Ⅴ. Corporate Governance 42

Ⅵ. Liability Issues 44

A. Who Can Sue? 44

B. Who Could Be Sued? 44

C. 'De Facto' Directors 44

D. Thresholds and Caps on Liability 44

E. Joint Liability/Solidarity 45

F. Derivative Actions 45

1. Class Actions 46

2. Relevance of Bankruptcy of Corporation with Regard to Bringing a Directors' Liability Suit 46

3. Costs and Fees in Liability Litigation 46

Ⅶ. Indemnification 46

Ⅷ. Directors' and Officers' Insurance 47

Ⅸ. Other Methods of Protection 47

Ⅹ. Lawyer Directorships 47

Ⅺ. Forecast on Future Legislation Development 47

Chapter 4 Brazil&Walter Douglas Stuber 49

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 49

A. Overview 49

B. Limitada 49

C. Sociedade Por Acoes ('SA') 51

Ⅱ. Recent Cases Dealing with Directors' Liability 53

Ⅲ. Judicial Review (Tightening of Standards) 53

Ⅳ. Typical Schemes/Behaviour to Avoid Directors' Liability 54

Ⅴ. Corporate Governance 54

Ⅵ. Liability Issues 56

A. Who Can Sue? 56

B. Who Can Be Sued? 56

C. 'De Facto' Director 57

D. Thresholds and Limitations/Caps of Liabilities 57

E. Joint Liability/Solidarity 57

F. Derivative Actions 58

G. Class Actions 58

H. Relevance of Bankruptcv of Corooration 58

Ⅶ. Indemnification 59

Ⅷ. Directors' and Officers' Insurance 59

Ⅷ. Other Methods of Protection 60

Ⅹ. Lawyer Directorship 60

Ⅺ. Forecast on Future Legislation Development 60

Chapter 5 Canada&Markus Koehnen and Erin Cowling 61

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 61

A. Two-Tier or Unitary Company Structure 61

B. Chairman/CEO 62

C. Board Structures 62

D. Elections/Staggering 62

E. Delegation 62

F. Removal of Directors 63

Ⅱ. Recent Cases Dealing with Directors' Liability 64

Ⅲ. Judicial Review (Tightening of Standards?) 65

A. The Shift from Result to Process 65

B. The Shift from a Subjective to an Objective Standard of Care 66

Ⅳ. 'Socio-Anthropological Issues' 66

A. Is the Composition of Boards Changing in Light of Recent Developments? 66

B. Are Decision-Making Mechanisms Changing in Light of Recent Developments? 66

C. Relationship between Board and Management 67

Ⅴ. Corporate Governance 67

A. Board Procedures 67

B. Structures of Oversight 68

Ⅵ. Liability Issues 69

A. Who Can Sue? 69

B. Who Can Be Sued? 69

C. Thresholds and Limitations/Caps of Liabilities 69

D. Joint Liability 70

E. Derivative Actions 70

F. Class Actions 70

G. Relevance of Bankruptcy 70

H. Costs and Fees in Liability Litigation 71

Ⅶ. Indemnification 71

Ⅷ. Directors' and Officers' Insurance 71

Ⅸ. Other Methods of Protection 71

Ⅹ. Lawyer Directorship 72

Chapter 6 Cayman Islands&Antony Duckworth, Alan de Saram and Wendy Stenning 73

Ⅰ. Introduction 73

Ⅱ. Board Structure 74

A. Appointment of Directors 74

B. Delegation 74

C. Removal of Directors 75

Ⅲ. Duties of Directors 75

A. General Duties of Directors 75

B. Duty of Honesty and Good Faith 76

C. Duties of Care and Skill 77

Ⅳ. Liability Issues 77

A. General Points 77

B. What Can Be Recovered? 78

C. Costs 78

Ⅴ. Indemnification of Directors 78

Ⅵ. Directors' Reliance on outside Professionals and Professionally Qualified Directors 78

Ⅶ. Winding Up 79

Chapter 7 Chile&Jaime Carey and Cristian Eyzaguirre 81

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 81

A. The Board of Directors 82

B. Composition of the Board 82

C. Powers of the Board and How They Are Used 83

D. Independent Directors and Audit Committee 84

E. Executive Officers 85

Ⅱ. Duties of Directors 85

A. Duty of Care 85

B. Duty of Loyalty 86

C. Duty of Disclosure 87

Ⅲ. Liability of Directors 88

Ⅳ. Directors' Insurance 89

Ⅴ. Actions to Pursue Redress of the Company 89

Ⅵ. Conclusion 90

Chapter 8 Mexico&Daniel Del Rio and Juan Jose Lopez-de-Silanes 93

Ⅰ. Introduction 93

A. Investment Promotion Companies ('Sociedades Anonimas Promotoras de Inversi6n ') 93

B. Stock Exchange Investment Promotion Companies ('Sociedades An6nimas Promotoras de Inversi6n Bursatil') 94

C. Stock Exchange Companies ('Sociedades Anonimas Bursatiles ') 94

Ⅱ. 'National Basics' and National Legal Theories of Directors' Liabilities 95

A. Two-Tier System or One-Tier System 95

B. Chairman and CEO (One or Two People/Checks and Balances) 96

C. Board Structures 96

D. Elections/Staggering 96

E. Delegation 97

F. Removal of Directors 97

Ⅲ. Judicial Review (E.g., Tightening of Standards?) 98

Ⅳ. 'Socio-Anthropological Issues' 98

A. Is the Composition of the Board of Directors Changing in Mexico in Light of Recent Developments? 98

B. Are the Decision-Making Mechanisms Changing in Mexico in Light of Recent Developments? 98

C. Board/Management Relationship 98

Ⅴ. Corporate Governance 99

A. Board Procedures 99

B. Structures of Oversight 99

Ⅵ. Liability Issues 100

A. Who Can Sue? 100

B. Who Can Be Sued? 101

C. Thresholds and Limitations/Caps of Liabilities in Mexico (Statutory Limitations on Directors' Liability) 101

D. Joint Liability/Solidarity 101

E. Derivative Actions 102

F. Class Actions 102

G. Relevance of Bankruptcy of Corporation with Regard to Bringing a Directors' Liability Suit 102

H. Costs and Fees in Liability Litigation 102

Ⅶ. Indemnification 103

Ⅷ. Directors' and Officers' Insurance 103

Ⅸ. Other Methods of Protection 103

Ⅹ. Lawyer Directorship 104

Ⅺ. The 'European Action Plan' 104

Chapter 9 United States of America&Robert Ripin and Christopher Winckler 105

Ⅰ. National Framework for US Corporate Boards 105

A. Regulatory Structure 105

B. Board Composition 106

1. Board and Corporate Structure 106

2. Number of Directors 106

3. Age and Nationality Restrictions 106

4. Independence 106

C. Multiple Roles 106

D. Board Procedures 107

E. Board Elections 107

1. Classified Boards 107

2. Cumulative Voting 107

3. Staggered Board 107

4. Weighted Voting 108

F. Delegation 108

G. Removal of Directors 108

Ⅱ. Standards Applicable to Directors 108

A. General Duties 108

B. State Statute, Securities Exchange, and Common Law Duties 109

1. Duty of Care 109

2. Duty of Loyalty 109

3. Business Judgment Rule 109

Ⅲ. Recent Cases Dealing with Directors' Liabilities 109

A. Citigroup/AIG/Krasner 109

B. WorldCom/Enron/Emerging Communications 110

C. Disney/Van Gorkom 111

D. Are Decision-Making Mechanisms Changing? 111

Ⅳ. Corporate Governance 112

A. Regulation 112

B. Sarbanes-Oxley Act 113

C. Board Composition/Independence 113

1. Independence of Majority of Board Members 113

2. Application to Foreign Private Issuers 113

3. Corporate Governance Guidelines/Code of Ethics 114

D. State Law Requirements (Delaware) 114

V. Liability Issues 114

A. Who Can Sue? 114

1. Shareholder Derivative Lawsuit 114

2. Creditors' Rights 115

3. Regulator Actions 115

B. Grounds for Liability 115

1. Criminal and Civil Liability 115

2. Securities Law 115

3. Antitrust 116

4. Theft and Fraud 116

5. Other 116

C. Thresholds and Limitations/Caps of Liabilities 116

D. Shareholder Liability 116

Ⅵ. Indemnification 117

Ⅶ. Insurance 117

Part Ⅲ. Asia 119

Chapter 10 Hong Kong&Allan Leung and Danny Leung 121

Ⅰ. Introduction 121

A. One-System Body 121

B. Board Structure and Duality of Chairman and CEO 122

1. Board Structure 122

2. Duality of Chairman and CEO 122

C. Delegation 123

D. Elections 123

E. Removal of Directors 123

Ⅱ. Liability Issues 123

A. Directors' Duties 123

1. Fiduciary Duties 124

a. Duty to Act in Good Faith in the Best Interests of the Company as a Whole 124

b. No Fetters on Discretion 124

c. Duty Not to Compete 124

d. Duty to Avoid a Conflict of Interest and Not to Make a Secret Profit 124

e. Confidentiality 125

2. General Duties 125

a. Skill, Care, and Diligence 125

b. Duty Not to Exceed Powers 126

c. Duty to Creditors 126

B. Who Can Sue? 126

1. Duties Owed to Individual Shareholder 126

2. Duties Owed to Creditors 127

C. Who Can Be Sued? 127

D. Derivative Actions 127

1. Common Law Derivative Action 127

2. Statutory Derivative Action 128

E. Unfair Prejudice 128

F. Representative Actions 129

G. Insolvency Context 129

1. Misfeasance 129

2. Fraudulent Trading 130

3. Disqualification Order 130

H. Costs and Fees in Liability Litigations 130

Ⅲ. Indemnification 130

Ⅳ. Protection against Wrongs of Directors 131

A. Ratification 131

B. Directors' and Officers' Liability Insurance 131

V. Corporate Governance 131

A. Existing Corporate Governance 131

B. Corporate Governance Reform: Difficulties in Hong Kong 132

1. Family-Controlled Companies 132

2. Quality of INEDs 132

C. Going Forward 133

Chapter 11 India&Som Mandal 135

Ⅰ. Introduction 135

A. Appointment of Directors 135

B. Shareholder Rights 136

C. Government's Right to Appoint Directors 136

D. Removal of Directors 136

E. Power of Directors May Be Amended 137

Ⅱ. Recent Cases and Anthropological Approach to Directors' Liabilities 137

A. Financial Scams 138

B. Judiciary 139

Ⅲ. Government's Approach towards Ensuring Greater Corporate Accountability 139

Ⅳ. Liability Issues 142

A. Officer in Default 143

B. Contractual Liabilities 143

C. Tortious Liability 144

D. Apprehension of Prosecution 144

E. Compounding Offences, a Way Out? 144

F. Managing Director/Whole-Time Director/ Nominee Director/Professional Director 145

G. Object and Scope of Section 633 145

H. Directors' Liability Insurance 145

Chapter 12 Israel&Rachel Levitan and Yael Navon 147

Ⅰ. National Basis: The Companies Law 1999 147

A. History of the Current Company Law 147

B. The Board's Role as a Gatekeeper 148

C. The Structure of the Controlling Powers of a Company 148

1. The General Assembly of Shareholders 148

2. The Board of Directors 149

3. Ancillary Articles Relating to the Board's Activities 149

4. Dismissal of a Director 150

a. The Power to Dismiss a Director 150

b. The Duty to Dismiss a Director 150

c. An Outside Director Can Only Be Dismissed as Follows: 150

5. The Chief Executive Officer 150

Ⅱ. Main Aspects of the Law Relevant to Directors' and Officers' Liability 151

A. Liability towards the Company 151

1. Duty of Care 151

2. Duty of Trust 151

3. Directors with Special Expertise 152

B. Directors' and Officers' Liability towards the Shareholders 152

C. Directors' and Officers' Liability towards Third Parties 153

D. Director and Officer Criminal Liability 155

E. Liability under Specific Laws 157

1. Liability According to the Securities Act of 1968 157

2. Presumption Set in Various Laws Concerning Directors' and Officers' Liability 157

Ⅲ. Claims against Directors and Officers: Procedural Aspects 157

A. Procedure for Claiming 157

1. Claim Filed by an Individual 158

2. Derivative Action 158

3. Class Action 158

B. Claims Against Directors and Officers During Liquidation 158

Ⅳ. Exemption, Indemnification, and Insurance 160

A. General 160

B. Exemption from Liability 160

C. Indemnification 160

D. Directors' and Officers' Liability Insurance 161

E. Invalid Stipulations 162

F. Special Approvals 162

Chapter 13 Japan&Norio Mitsuuchi 165

Ⅰ. Introduction 165

Ⅱ. Basic Structures (to Have a Board or Not, Etc.) 166

A. Overview 166

B. KK without a Board 166

C. KK with a Board 166

D. KK with Committees 166

Ⅲ. CEO, President, and Other Officers 167

Ⅳ. Structures of Board and Committees 167

Ⅴ. Elections 167

Ⅵ. Delegation 168

Ⅶ. Removal of Directors 168

ⅤⅢ. Other Recent Changes 168

A. Outside Director 168

B. Decision-Making Mechanism 168

Ⅸ. Judicial Review 169

A. Relationship between KK and Directors/Executive Officers 169

B. Business Judgment Rule 169

X. Corporate Governance 169

A. Convocation of the Board 169

B. Resolutions 170

C. Structure of Oversight 170

Ⅺ. Liability Issues 170

A. Who Can Sue? 170

1. Company 170

2. Shareholder 170

3. Third Party 171

B. Who Can Be Sued? 171

C. Thresholds and Limitation of Liabilities 171

1. Negligence Requirement 171

2. Exemption from Liabilities 172

3. Partial Exemption from Liabilities 172

4. Prior Agreement to Limit Liabilities 172

D. Relevance of Bankruptcy of a KK with Regard to Bringing a Directors' Liability Suit 172

E. Costs and Fees in Liability Litigations 172

F. Insurance 173

G. Other Methods of Protection 173

H. Lawyer Directorship 173

Ⅻ. Conclusion 173

Chapter 14 Mongolia&Michael Aldrich, Byambaa Batbayar and Dashnyam Zoljargal 175

Ⅰ.　Introduction: General Principles of Mongolian Corporate Law 175

A. The Company Law of Mongolia 176

B. Three-Tiered Body for Corporate Governance 176

C. Executive Administration 178

D. Board Composition 179

E. Delegation 179

F. Directors' Elections 179

G. Chairman of the Board 179

H. Directors' Term of Appointment 180

I. Board Meetings 180

J. Removal of Directors 180

Ⅱ. Recent Cases Dealing with Directors' Liability: Anod Bank 180

Ⅲ. Judicial Review 181

Ⅳ. Corporate Governance 181

Ⅴ. Liability Issues 182

A. Who Can Be Sued? 182

B. Who Can Sue? 183

C. Thresholds and Limitations/Caps of Liabilities 183

D. Joint and Several Liability 183

E. Derivative Actions 183

F. Class Actions 183

Ⅵ. Directors' and Officers' Insurance 184

Ⅶ. Lawyer Directorship 184

ⅤⅢ. Forecast on Future Legislation Development 184

Chapter 15 The People's Republic of China&Michael Aldrich and Ke Chen 185

Ⅰ. Introduction 185

A. Three-Tiered Corporate Governance Body 186

1. Shareholders 186

2. Board of Directors or Executive Director 186

3. Board of Supervisors 187

B. Board Structure and Concurrent Offices 187

1. Board Structure 187

2. Concurrent Office 188

C. Delegation 188

D. Elections 188

E. Removal of Directors 188

F. Qualification of Directors 188

Ⅱ. Liability Issues 189

A. Directors' Duties 189

1. Fiduciary Duty 189

2. General Duties 189

3. Legal Representative 190

4. Apparent Authority 190

B. Who Can Sue? 191

1. Duties Owed to the Company 191

2. Duties Owed to Shareholders 191

3. Duties Owed to Creditors 191

C. Who Can Be Sued? 192

D. Derivative Actions by Shareholders 192

E. Unfair Prejudice 192

1. Compulsory Buy Back 192

2. Compulsory Winding Up 193

F. Representative Actions 193

G. Insolvency Context 193

H. Costs and Fees in Liability Litigations 193

Ⅲ. Indemnification 194

Ⅳ. Protection against Wrongs of Directors 194

A. Ratification 194

B. Directors' and Officers' Liability Insurance 194

V. Corporate Governance 194

Chapter 16 The Russian Federation&Oxana Balayan 197

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 197

A. Two-Tier or Unitary Company Structure 197

B. Chairman/CEO 198

C. Board Structures 198

D. Directors' Elections/Staggering 198

E. Directors' Term of Appointment 199

F. Delegation 199

G. Removal of Directors 199

Ⅱ. Recent Cases Dealing with Directors' Liability 200

Ⅲ. Judicial Review (Tightening of Standards?) 200

Ⅳ. Typical Schemes/Behaviour to Avoid Director's Liability 200

V. Corporate Governance 201

A. Difference between JSCs and LLCs 201

B. Corporate Governance Code 201

Ⅵ. Liability Issues 201

A. Who Can Sue? 201

1. The Company 201

2. The Shareholder 202

3. Creditors and Third Parties 203

4. The Government 203

B. Who Can Be Sued? 204

C. 'De Facto' Director 204

D. Thresholds and Limitations/Caps of Liabilities 204

E. Joint Liability/Solidarity 204

F. Derivative Actions 205

G. Class Actions 205

H. Relevance of Bankruptcy of Corporation with Regard to Bringing a Directors' Liability Suit 205

Ⅶ. Indemnification 206

ⅤⅢ. Directors' and Officers' Insurance 206

Ⅸ. Lawyer Directorship 207

Ⅹ. Forecast on Future Legislation Development 207

Chapter 17 Singapore&Andrew M. Lim 209

I. 'National Basics' and National Legal Theories of Directors' Liabilities 209

A. Directors' Liabilities in General 209

B. Board Structures 211

1. Code of Corporate Governance 211

2. Chairman and CEO 211

3. Board Composition and Guidance 211

C. Elections and Appointment 212

D. Delegation 212

E. Removal of Directors 212

Ⅱ. Cases Dealing with Directors' Liability 213

A. Lim Weng Kee v. Public Prosecutor 213

B. Vita Health Laboratories Pte Ltd & Ors v. Pang Seng Meng 213

C. W&P Piling Pte Ltd (in liquidation) v. Chew Yin What & Ors 214

D. Public Prosecutor v. Lee Thian Soon and Other Decisions 214

E. Public Prosecutor v. Ong Chow Hong 214

Ⅲ. Recent Developments 215

A. Corporate Governance Council 215

B. Audit Committee Guidance Committee 215

C. Legislative Proposals 216

D. Financial Services Industry 216

Ⅳ. Corporate Governance 217

A. Independent Directors 217

B. Oversight Committees 217

V. Liability Issues 218

A. Who Can Sue? 218

B. Who Can Be Sued? 219

C. Thresholds and Limitations on Directors' Liabilities 219

D. False Reports 219

E. Joint/Several Liability 220

F. Derivative Actions 220

G. Oppression Actions 220

H. Release of Directors' Duties 220

Ⅵ. Indemnification and Insurance 221

Chapter 18 Turkey&Serdar Paksoy 223

Ⅰ. Introduction 223

Ⅱ. Who Can Be Elected as Director? 224

A. Becoming a Director 224

1. Qualifictions of Directors 224

2. Proposed Amendments 224

Ⅲ. Composition of the Board 225

Ⅳ. Fiduciary Duties of Directors 225

Ⅴ. Liabilities of Directors 226

A. Situations in which Directors Are Held Liable 226

1. Incorrect Payments of the Shareholders for Their Capital Contributions 227

2. Distributed Dividends That Do Not Reflect the Actual Situation 227

3. Non-existing or Unduly Kept Corporate Books and Company Records 227

4. Shareholders Resolutions That Are Not Implemented without a Just Cause 227

5. Directors' Deliberate or Negligent Failure to Perform Other Duties Delegated by the TCC or the Articles of Association 228

6. Failure to Appoint Capable Executives 228

B. Negligence Principle 228

C. Who Can Sue the Directors? 229

1. Company 229

2. Shareholders 229

3. Third-Party Claims 229

D. Liability of Directors under the CML 230

E. Liabilities of Directors Arising out of Extraordinary Transactions 230

1. Capital Increases 230

2. Issuing Bonds 231

3. Liability in Case of Bankruptcy 231

F. Liability of Directors under the Tax Laws 231

G. Liability of Directors under Social Security Law 231

H. Liability of Directors under the Banking Law 232

I. Liability of Directors under Criminal Law 232

Ⅵ. Defences of Directors 232

Ⅶ. Ceasing to Be a Director 232

Chapter 19 United Arab Emirates&Imtiaz Shah and Charlotte Douglass 235

Ⅰ. UAE Legal Regime 235

A. Introduction 235

B. Free Zones 236

C. Permitted Corporate Vehicles 236

Ⅱ. 'National Basics' and National Legal Theories of Directors' Liabilities 237

A. Company Structure 237

B. Chairman and CEO 238

C. Board Structures 239

D. Directors' Elections 239

E. Directors' Term of Appointment 239

F. Delegation 240

G. Removal of Directors 240

Ⅲ. Corporate Governance 240

A. Ministerial Decision No. 32/R of 2007 241

B. Decision 518 241

Ⅳ. Liability Issues 243

A. General Concept 243

1. General Liabilities: Onshore Companies 243

2. Criminal/Other Liabilities: Onshore 244

3. General Liabilities: DIFC Companies 244

a. Loyalty 245

b. Conflict of Interest 245

c. No Secret Profits 245

d. Confidentiality 245

e. Care, Skill, and Diligence 246

Ⅴ. Who Can Sue? 246

Ⅵ. 'De Facto' Director 246

Ⅶ. Thresholds and Limitations/Caps of Liabilities 247

ⅤⅢ. Relevance of Bankruptcy of Corporation 247

Ⅸ. Indemnification 247

Ⅹ. D&O Insurance 247

Ⅺ. Forecast on Future Legislation Development 248

Chapter 20 Vietnam&Christian Schaefer and Phong Nguyen 249

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 250

A. Legal Framework and the Enterprise Law 250

B. Company Forms under the Enterprise Law and Two-Tiered or Unitary Company Structure 250

1. Limited Liability Company 250

2. Joint Stock Company 252

C. Definition of 'Director' 252

D. Chairman/CEO (General Director) 252

E. Board Structures 253

F. Directors' Elections/Staggering and Directors' Term of Appointment 254

G. Delegation 254

H. Removal of Directors 255

Ⅱ. Recent Cases Dealing with Directors' Liability 255

Ⅲ. Judicial Review (E.g., Tightening of Standards?) 256

Ⅳ. Typical Schemes/Behaviour to Avoid Directors' Liability 256

Ⅴ. Corporate Governance 256

Ⅵ. Liability Issues 257

A. Who Can Sue? 257

B. Who Can Be Sued? 258

C. 'De Facto' Director 258

D. Thresholds and Limitations/Caps of Liabilities 258

E. Joint Liability/Solidarity 258

F. Derivative Actions 259

G. Class Actions 259

H. Significance of Bankruptcy of Corporation 259

Ⅶ. Indemnification 259

ⅤⅢ. D&O Insurance 259

Ⅸ. Other Methods of Protection 260

Ⅹ. Lawyer Directorship 260

Ⅺ. Forecast on Future Legislation Development 260

Part Ⅳ. Australia and New Zealand 261

Chapter 21 Australia&Fred Chilton and Michael Scarf 263

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 263

A. Two-Tiered or Unitary Company Structure 263

B. Chairman and CEO (One or Two People/Checks and Balances) 264

C. Board Structures 264

D. Elections/Staggering 264

E. Delegation 265

F. Removal of Directors 265

Ⅱ. Recent Cases Dealing with Directors' Liability 265

Ⅲ. Judicial Review (Tightening of Standards?) 266

Ⅳ. 'Socio-Anthropological Issues' 266

A. Is Board Composition Changing in Australia in Light of Recent Developments? 266

B. Are the Decision-Making Mechanisms Changing in Australia in Light of Recent Developments? 267

C. Board/Management Relationship 267

V. Corporate Governance 268

A. Board Procedures 268

B. Structures of Oversight (Mechanisms, Etc.) 268

Ⅵ. Liability Issues 269

A. Who Can Sue? 269

1. The Company and Individual Shareholders 269

2. Australian Securities and Investments Commission 269

3. Creditors 269

B. Who Can Be Sued? 269

C. On what Basis Can a Director Be Sued? 270

D. Thresholds and Limitations/Caps of Liabilities in Australia (Statutory Limitations on Directors' Liability) 270

1. Duty of Care and Diligence 271

2. Duty to Prevent Insolvent Trading 271

E. Joint Liability/Solidarity 271

F. Derivative Actions 272

G. Class Actions 272

H. Bankruptcy and a Directors' Liability Suit 273

I. Costs and Fees in Liability Litigation 273

Ⅶ. Indemnification 273

ⅤⅢ. Directors' and Officers' Insurance 274

Ⅸ. Other Methods of Protection 274

Ⅹ. Lawyer Directorship 275

Chapter 22 New Zealand&Jeremy Steel, Mark Williamson and Jess Hogan 277

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 277

A. 'One System' Approach 277

B. Definition of 'Director' 278

C. Separation of Chairman and CEO 278

D. Board Structures 278

E. Elections/Staggering 279

F. Delegation 279

G. Board Meetings 280

H. Disclosure of Conflicts of Interest 280

I. Removal of Directors 280

Ⅱ. Judicial Review (Tightening of Standards?) 280

Ⅲ. Corporate Governance 281

A. Changes to Regulatory Regime 281

1. NZX Corporate Governance Best Practice Code 281

2. Securities Commission: Corporate Governance Principles 282

B. Use of Board Committees 282

C. Other Oversight Structures 283

Ⅳ. Liability Issues 283

A. Who Can Sue? 284

1. The Company 284

2. Shareholders 284

3. Creditors 284

4. Regulatory Bodies 284

B. Who Can Be Sued? 285

C. Statutory Limitations on Directors' Liability 285

D. Joint Liability 285

E. Derivative Actions 285

F. Class Actions 286

G. Relevance of Liquidation 286

H. Costs in Liability Litigation 286

Ⅴ.　Recent Cases Dealing with Directors' Liability 286

A. Reckless Trading 286

B. Directors' Duties 287

C. Silent Directors 288

D. Directors of Finance Companies 288

E. Other Statutory Liability 288

Ⅵ. Judicial Review 288

Ⅶ. Indemnification and Insurance 289

A. Indemnity 289

B. Insurance 289

ⅤⅢ. Forecast on Future Legislation Development 290

Ⅸ. Conclusion 290

Part Ⅴ. Europe 291

Chapter 23 The European Action Plan&Thorsten M. Volz 293

Ⅰ. Introduction 293

Ⅱ. The Scope of the European Action Plan 294

Ⅲ. The Proposed Time Schedule of the European Action Plan 295

Ⅳ. Provisions on Directors' Liability within the European Action Plan 296

Ⅴ. The Implementation within the European Community 297

Ⅵ. The Implementation within Member States' Legislation 298

A. Austria 298

B. Belgium 298

C. Czech Republic 299

D. Denmark 299

E. Finland 299

F. France 299

G. Germany 299

H. Ireland 300

I. Italy 300

J. Luxembourg 300

K. Netherlands 301

L. Poland 301

M. Portugal 301

N. Spain 301

O. Sweden 302

P. Switzerland 302

Q. Ukraine 302

R. United Kingdom 302

Chapter 24 Austria&Christian Dorda 303

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 303

A. Composition and Structure of Boards 304

B. Appointment, Election, Delegation, and Removal of Directors 304

C. General Principles of Directors' Liability 305

1. Liability of Directors towards the Company 305

2. Liability of Directors towards Third Parties 305

Ⅱ. Recent Cases Dealing with Directors' Liability 306

Ⅲ. Judicial Review: Tightening of Standards? 307

Ⅳ. Typical Schemes to Avoid Directors' Liability 307

A. Changing Composition of Boards 307

B. Changing Decision-Making Mechanism 308

C. Board/Management Relationship 308

Ⅴ. Corporate Governance 308

Ⅵ. Liability Issues 309

A. Who Can Sue? 309

1. The Company 309

2. Shareholders 310

3. Third Parties 310

B. Who Can Be Sued? 310

1. Directors 310

2. The Company 310

C. Thresholds and Limitations 310

D. Joint Liability/Solidarity 311

E. Derivative Actions 311

F. Class Actions 311

G. Relevance of Bankruptcy 311

H. Costs and Fees in Liability Litigations 312

Ⅶ. Indemnification 312

ⅤⅢ. Directors' and Officers' Insurance 312

Ⅸ. Other Methods of Protection 312

Ⅹ. Lawyer Directorship 313

Ⅺ. The 'European Action Plan' 313

Chapter 25 Belgium&Roel Nieuwdorp and Jens Van Hecke 315

Ⅰ. Introduction 315

Ⅱ. 'National Basics' and National Legal Theories of Directors' Liabilities 315

A. One- and Two-Tier Systems 315

B. Board Structure 316

C. Elections/Staggering 316

D. Chairman and CEO 317

E. Removal 318

F. Representation of the Company 318

G. Conflicts of Interest 318

Ⅲ. Corporate Governance 318

A. Duty of Care of the Director 319

B. Enforceability 319

Ⅳ. Liability Issues 320

A. Introduction 320

B. Civil Liability 320

1. Contractual Liability 320

a. Who Can Sue? 320

b. When Can a Director Be Held Liable? 321

Ⅰ. Fault 321

Ⅱ. Damage 321

Ⅲ. Causal Relation 321

c. What Kind of Liability? 321

2. Liability for Violations of the Articles and of the Company Code 322

a. Who Can Sue? 322

b. When Can a Director Be Held Liable? 322

Ⅰ. Fault 322

Ⅱ. Damage 323

Ⅲ. Causal Relation 323

c. What Kind of Liability? 323

d. Specific Case: Bankruptcy 323

e. Specific Case: Social Security Fraud 324

f. Specific Case: Founders' Liability 324

3. Tort Liability 324

a. Who Can Sue? 324

Ⅰ. Relation Director: Company 324

Ⅱ. Relation Director: Third Parties 325

b. When Can a Director Be Held Liable? 325

c. What Kind of Liability? 325

C. The Act of 3 July 1978 Concerning Employment Agreements 325

Ⅴ. Judicial Review 325

Ⅵ. Ways to Avoid or Limit Directors' Liability 326

A. The Use of Legal Entities 326

B. Whistleblowing 326

C. Exoneration Clauses 326

D. Hold Harmless Clauses 327

E. Discharge 327

1. Validity of the Discharge 327

2. Scope of the Discharge 328

3. Contractual Commitments to Grant Discharge 328

F. Resignation 328

G. Directors' Insurance 328

H. Statute of Limitations 328

Ⅵ. Lawyer Directorship 329

Ⅶ. Forecast on Future Legislation 329

Chapter 26 Czech Republic&Dagmar Dubeckd and Martin Solc 331

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 331

A. Basic Powers of the Statutory Bodies 332

1. Board of Directors 332

2. Supervisory Board 333

B. Composition of Company Bodies, Membership, and Requirements for the Performance Office 333

1. Composition of Company Bodies 333

2. Election and Removal, Membership Requirements 334

C. Decision Making by Statutory Bodies, Prohibition of Parallel Functions, Ban on Competition, Restrictions on Parallel Employment 335

1. Decision Making by Company Bodies 335

2. Parallel Performance of Functions and Ban on Competition 335

3. Relations between a Member of the Board of Directors and the Company under Labour Law 335

4. Remuneration 336

Ⅱ. Liability Issues 336

A. Basic Obligations, Consequences of Breach, Burden of Proof 336

B. Persons Authorized to Claim Compensation for Damage and Limitation Periods 337

C. Basic Criminal Law Aspects 338

D. Liability of Other Persons with Influence on the Acts of the Company 338

1. Brief Introduction to the Law on Corporate Groups 338

2. Liability of Statutory Bodies to the Controlling Entity 339

3. Liability of Other Persons with Influence on Management of the Company 339

a. Protection for Members of Statutory Bodies 339

b. The National Climate 340

Chapter 27 Denmark&Jφrgen Boe and Macls Poulsen 341

Ⅰ. The Danish Management System 341

A. General 341

B. Election of Directors and Managers 342

C. The Division of Power 342

Ⅱ. Directors' Liability 343

A. Legal Prerequisites to Liability 343

B. Tasks and Duties 344

C. Directors in Listed Companies 345

Ⅲ. Recent Cases Dealing with Directors' Liability 346

A. Introduction 346

B. Liability for Violation of the Companies Act 346

C. Liability for Predecessors' or Successors' Acts 347

D. Liability for Violating the Financial Statements Act 348

E. Duties in Pursuance of Special Legislation 348

F. Operation of a Company in Difficulties 349

Ⅳ. Developments in the Liability of Directors 350

Ⅴ. Corporate Governance 350

Ⅵ. Limitation of Liability 351

A. Introduction 351

B. Agreed Exemption From Liability 351

C. Discharge from Liability: Adoption of Accounts 351

D. Reduction of Liability 351

Ⅶ. Insurance 352

A. Common Directors' and Officers' Liability Insurance 352

B. Lawyers' Liability Insurance 352

C. Effect of Insurance Coverage 352

Chapter 28 Finland*Kari Lautjarvi and Riikka Leinonen 355

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 355

A. Company Organs 356

B. Board of Directors 357

1. Number of Board Members, Their Election, and Term of Duty 357

2. Duties of Board Members under the Companies Act 358

3. Finnish Corporate Governance Code and Finnish Panel on Takeovers and Mergers 359

Ⅱ. Liability of Board Members 360

A. Liability under the Companies Act 360

B. Damage, Negligence, and Causality 361

C. Scope of Liability 361

D. Amount of Compensation and Legal Costs 362

Ⅲ. Division of Liability 362

A. Delegation 362

B. Adjustment and Allocation of Damages 363

Ⅳ. Limitation of Liability 363

Chapter 29 France&Jacques Buhart 365

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 365

A. Two-Tiered or Unitary Company Structure 365

B. Chairman and CEO (One or Two People/Checks and Balances) 366

1. Unitary Structure 366

2. Two-Tiered Structure 366

C. Board Structures 366

1. Unitary Structure 366

2. Two-Tiered Structure 366

D. Director's Elections/Staggering 367

1. Unitary Structure 367

2. Two-Tiered Structure 367

E. Directors' Term of Appointment 367

1. Unitary Structure 367

2. Two-Tiered Structure 367

F. Delegation 367

G. Removal of Directors 368

1. Unitary Structure 368

2. Two-Tiered Structure 368

Ⅱ. Recent Cases Dealing with Director's Liability 368

Ⅲ. Judicial Review (Tightening of Standards?) 368

Ⅳ. 'Socio-Anthropological Issues' 369

A. Is the Composition of the Board of Directors Changing in France in Light of Recent Developments? 369

B. Are the Decision-Making Mechanisms Changing in France in Light of Recent Developments? 369

C. Board/Management Relationship 369

1. Unitary Structure 369

2. Two-Tiered Structure 370

Ⅴ. Corporate Governance 370

A. Board Procedure 370

B. Structures of Oversight 370

Ⅵ. Liability Issues 371

A. Who Can Sue? 371

1. Shareholders 371

2. The Company Itself 371

3. Third Parties 372

B. Who Can Be Sued? 372

1. Directors 372

a. Directors' Civil Liability 372

b. Directors' Criminal Liability 372

2. Supervisory Board Members 373

C. 'De Facto' Director 373

D. Thresholds and Limitations/Caps of Liabilities/Caps of Liabilities in France (Statutory Limitations on Directors' Liability) 373

E. Joint Liability/Solidarity 374

F. Derivative Actions 374

G. Class Actions 374

H. Relevance of Bankruptcy of Corporation with Regard to Bringing A Directors' Liability Suit 374

1. Directors' Liability 374

a. Directors' Civil Liability 375

b. Directors' Criminal Liability 375

c. Extension of Bankruptcy Proceedings to Director 375

2. Liability of Supervisory Board Members 376

3. Costs and Fees in Liability Litigations 376

Ⅶ. Indemnification 376

ⅤⅢ. Directors' and Officers' Insurance 376

Ⅸ. Other Methods of Protection 376

Ⅹ. Lawyer Directorship 377

A. French Lawyers May Not Directly Run a Company unless they Are Appointed in Companies Owned by their Own Families 377

B. French Lawyers May Be Appointed as Director 377

Ⅺ. The 'European Action Plan' 377

Chapter 30 Germany&Alxander Loos 379

Ⅰ. Basic Principals for Directors' Liability 379

A. Single-Body Companies or Two-Tier System 379

B. Management Structure and Chairman 380

C. Delegation of Management Powers 380

D. Removal of Directors 381

Ⅱ. Typical Liability Cases 381

A. Internal Liability towards the Company 381

1. Violation of Non-compete 381

2. Poaching of Business from the Company 382

3. Disbursements from Restricted Equity of the Company 382

4. Violation of Arm's Length Principles 383

5. Knowing Disregard of Avoidable Risk 383

B. External Directors' Liability 383

1. Gross Negligence to Pay Taxes and Public Levies 384

2. Illicit Non-payment of Social Security Contributions 384

3. Late Filing for Insolvency 384

Ⅲ. Liability Issues 385

A. Enforcement of Director's Liability 385

1. Who Can Sue? 385

2. Costs of Litigation and Class Actions 386

B. Joint Liability of Directors 387

C. Indemnification 387

Ⅳ. Directors' and Officers' Insurance 387

Ⅴ. Lawyer Directorships 388

Ⅵ. The European Action Plan 388

Chapter 31 Ireland&ichael Greene and David Dobbyn 389

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liability 390

A. Board Structures 390

B. Chairman and CEO 391

C. Composition of the Board 392

D. Election and Term of Appointment 393

E. Delegation 393

F. Removal of Directors 394

Ⅱ. Recent Cases Dealing with Directors' Liability 395

A. Responsibilities under Environmental Law 395

B. Non-executive Directors 396

Ⅲ. Corporate Governance 397

A. Combined Code 397

B. Directors' Compliance Statements 398

Ⅳ. Liability Issues for Directors 400

A. Who Can Sue? 400

1. Public Authorities 400

2. The Company 400

3. Shareholders and Employees 400

4. Creditors 401

5. Third Parties 401

B. Who Can Be Sued? 401

1. Executive and Non-executive Directors 401

2. Shadow Directors 402

C. 'De Facto' Director 402

D. Penalties 402

E. Impact of Insolvency 403

Ⅴ. Indemnification 404

Ⅵ. Directors' and Officers' Insurance 404

Ⅶ. Other Methods of Protection 405

ⅤⅢ. Lawyer Directorships 405

Ⅸ. Forecast on Future Legislation Development 406

Chapter 32 Italy&Guido Brosio and Gabriele Fagnano 409

Ⅰ. Corporate Governance Structure and Directors' Liability 409

A. Traditional, Single-Body, and Two-Tier System; Structures of Internal Control 409

B. Appointment and Removal of Directors 410

C. Board Structure and Main Executive Roles 411

D. Delegation and Information Flow within the Board of Directors 412

E. Directors' Interests in Relation to Company Action 413

Ⅱ. Directors' Duties and Recent Cases Dealing with Directors' Liability 413

A. Directors' Duties 413

B. Judicial Approach to Directors' Standard of Care and Diligence and Limits to Judicial Review of Directors' Business Errors: Tightening of Standards 414

Ⅲ. Liability Issues 416

A. Who Can Sue? 416

1. Company Action against Directors and Relevant Indemnification 416

2. Action of Company Creditors and Relevant Indemnification 417

3. Action of Third Parties and Individual Shareholders, Relevant Indemnification 417

B. Who Can Be Sued? 418

C. Statute of Limitations and Other Limitations of Liability 418

1. Statute of Limitations 418

2. Other Limitations 419

D. Joint and Several Liability 419

E. Derivative Actions and Class Actions 420

F. Relevance of Bankruptcy with Regard to Bringing a Directors' Liability Suit 420

Chapter 33 Luxembourg&Guy Harles and Saskia Konsbruck 421

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 421

A. 'One- or Two-Tiered System' 421

B. Chairman and CEO 422

C. Board Structures 422

D. Elections/Staggering 423

E. Delegation 423

F. Removal of Directors 424

Ⅱ. Recent Cases Dealing with Directors' Liability 424

Ⅲ. Judicial Review (E.g., Tightening of Standards?) 425

Ⅳ. 'Socio-Anthropological Issues' 425

Ⅴ. Corporate Governance 425

Ⅵ. Liability Issues 426

A. Who Can Sue? 426

1. Liability for Management Errors (Article 59, § 1 of the Law) 427

2. Liability for Infringement of the Law or the Articles of Incorporation (Article 59,§2 of the Law) 427

3. Liability in Tort 427

4. Liability under Criminal Law 427

B. Who Can Be Sued? 428

1. Liability for Management Errors (Article 59,§1 of the Law) 428

2. Liability for Infringement of the Law or the Articles of Incorporation (Article 59, §2 of the Law) 429

3. Liability in Tort 429

4. Liability under Criminal Law 430

C. Thresholds and Limitations/Caps of Liabilities 430

D. Joint Liability/Solidarity 430

1. Liability for Management Errors (Article 59,§1 of the Law) 430

2. Liability for Infringement of the Companies Law or the Articles of Incorporation (Article 59, § 2 of the Law) 431

3. Liability in Tort 431

4. Liability under Criminal Law 431

E. Derivative Actions 431

F. Class Actions 432

G. Relevance of Bankruptcy of the Corporation with Regard to Bringing a Directors' Liability Suit 432

H. Costs And Fees in Liability Litigations 432

Ⅶ. Indemnification 433

ⅤⅢ. Directors' and Officers' Insurance 433

Ⅸ. Other Methods of Protection 433

Ⅸ. Lawyer Directorship 434

Ⅺ. The European Action Plan 434

Chapter 34 The Netherlands&Willem Calkoen and Martin Grablowitz 437

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 437

A. Two-Tier System or One-Tier System Body 437

B. Chairman and CEO (One or Two People/Checks and Balances) 438

C. Board Structures 438

D. Elections/Staggering 439

E. Delegation 439

F. Removal of Directors 439

Ⅱ. Recent Cases Dealing with Directors' Liability 440

Ⅲ. Judicial Review (Tightening of Standards?) 440

Ⅳ. 'Socio-Anthropological Issues' 441

A. Composition of the Board of Directors 441

B. Decision-Making Mechanism 441

C. Board/Management Relationship 441

Ⅴ. Corporate Governance 441

Ⅵ. Liability Issues 442

A. Who Can Sue? 442

1. The Company 442

2. The Shareholder 442

3. Trustee in Bankruptcy 442

4. Creditors and Third Parties 442

5. The Government 443

B. Who Can Be Sued? 443

C. Thresholds and Limitations/Caps of Liabilities in the Netherlands (Statutory Limitations on Directors' Liability) 443

D. Joint Liability/Solidarity 443

E. Derivative Actions 444

F. Class Actions 444

G. Relevance of Bankruptcy of Corporation with Regard to Bringing a Directors' Liability Suit 445

H. Costs and Fees in Liability Litigations 445

Ⅶ. Indemnification 445

ⅤⅢ. Directors' and Officers' Insurance 446

Ⅸ. Lawyer Directorship 447

Ⅹ. The 'European Action Plan' 447

A. Modernizing the Board of Directors 447

B. Implementation 447

Chapter 35 Poland&Tomasz Zak 449

Ⅰ 'National Basics' and National Legal Theories of Directors' Liability 449

A. Two-Tired or Unitary Company Structure 449

B. Chairman and CEO 450

C. Board Structure 450

D. Directors' Election/Staggering 451

E. Directors' Term of Appointment 451

F. Delegation of Powers 451

G. Removal and Suspension of Directors 452

Ⅱ. Typical Schemes/Behaviour to Avoid a Directors' Liability 452

Ⅲ. Corporate Governance 453

A. Management Board 453

B. Supervisory Board 454

Ⅳ. Liability Issues 454

A. Liability Towards the Company 454

B. Liability towards Third Parties 455

C. Derivative and Class Actions 457

D. Costs 458

E. Criminal Liability 458

Ⅴ. Indemnification 458

A. Liability towards Third Parties 458

B. Liability towards the Company 459

Ⅵ. Directors' and Officers' Insurance 459

Ⅶ. Lawyer Directorship 459

Chapter 36 Portugal&Miguel de Avillez Pereira and Bruno Sampaio Santos 'National Basics' and National Legal Theories of Directors' Liabilities 461

Ⅰ National Basics and National Legal Theories of Directors' Liabilities 461

A. Two-Tier System or One-System Body 461

B. Chairman and CEO (One or Two People/Checks and Balances) 462

C. Board Structures 462

D. Elections/Staggering 462

E. Delegation 463

F. Removal of Directors 463

Ⅱ. Recent Cases Dealing with Directors' Liability 464

Ⅲ. Judicial Review (Tightening of Standards?) 464

Ⅳ. 'Socio-Anthropological Issues' 465

A. Is the Composition of the Board of Directors Changing in Portugal in Light of Recent Developments? 465

B. Are the Decision-Making Mechanisms Changing in Portugal in Light of Recent Developments? 466

C. Board/Management Relationship 466

Ⅴ. Corporate Governance 466

Ⅵ. Liability Issues 467

A. Who Can Sue? 467

1. Liability towards the Company 467

2. Liability towards Shareholders (and Other Third Parties) 467

3. Liability towards Creditors of the Company 468

4. Liability before Tax Authorities and Social Security 468

B. Who Can Be Sued? 468

C. Thresholds and Limitations/Caps of Liabilities in Portugal (Statutory Limitations on Directors' Liability) 468

D. Joint Liability/Solidarity 469

E. Derivative Actions 469

F. Class Actions 469

G. Relevance of Bankruptcy of Corporation with Regard to Bringing a Directors' Liability Suit 469

H. Costs and Fees in Liability Litigations 470

Ⅶ. Indemnification 470

ⅤⅢ. Directors' and Officers' Insurance 470

Ⅸ. Other Methods of Protection 470

Ⅹ. Lawyer Directorship 471

Ⅺ. The 'European Action Plan' 471

Chapter 37 Spain&Enric Picanyol, Coro Ferndndez-Ranada and ldoya Ferndndez 473

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 473

A. Two-Tier versus 'One-System' Body 473

B. Chairman and CEO 474

C. Board Structure 474

D. Elections/Staggering 474

E. Delegation 475

F. Removal of Directors 475

Ⅱ. Recent Cases Dealing with Directors' Liability 475

A. General Rules 475

B. Infra-capitalization 476

Ⅲ. Judicial Review 476

Ⅳ. 'Socio-Anthropological Issues' 477

Ⅴ. Corporate Governance 477

Ⅵ. Liability Issues 478

A. Who Can Sue? 478

1. Corporate Action 478

2. Individual Action 479

B. Who Can Be Sued? 479

1. Directors 479

2. Corporate Entities as Directors 479

3. 'De Facto' Directors 479

4. Liquidators 480

5. Persons Holding Powers of Attorney 480

C. Thresholds and Limitations 480

1. Statute of Limitations 480

2. Negligence 480

D. Joint Liability/Solidarity 481

E. Derivative Actions 481

F. Class Actions 481

G. Relevance of Bankruptcy of Corporation with Regard to Bringing a Directors' Liability Suit 482

Ⅶ. Indemnification 483

ⅤⅢ. Directors' and Officers' Insurance 483

Ⅸ. Other Methods of Protection 484

Ⅹ. Lawyer Directorship 484

Ⅺ. The 'European Action Plan' 485

Chapter 38 Sweden&Per Berglof and Sverker Bonde 487

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 487

A. Business Form and the Legal Framework 487

B. Basic Organization and Corporate Bodies of a Swedish Aktiebolag 488

C. Responsibilities of the Different Organs and Delegation 488

D. Election and Removal of Directors 489

Ⅱ. Recent Cases Dealing with Directors' Liability 490

Ⅲ. Judicial Review of Directors in Sweden 490

Ⅳ. Corporate Governance 491

A. Composition of the Board 491

B. Decision-Making Mechanisms: Board Committees 491

C. Duties of Directors towards the Company 492

D. Duties of Directors towards Majority and Minority Shareholders 492

E. Duties of Directors in Case of Bankruptcy 492

Ⅴ. Liability Issues 493

A. Legal Framework 493

B. Who Can Sue and Be Sued? 493

1. The Company 493

2. Shareholders: Derivative Actions 494

3. Creditors and Other Third Parties 494

4. Insolvency Administrators/Trustees in Bankruptcy 494

C. Directors' Criminal Liability 494

D. 'De Facto' Directors' Liability 494

E. Thresholds and Limitations to Liability 495

F. Class Actions 495

G. Costs and Fees in Liability Litigations 495

Ⅵ. Indemnification by the Company and Insurance 495

Ⅶ. Other Methods of Protection 496

ⅤⅢ. Lawyer Directorship 496

Ⅸ. Forecast on Future Legislation Development 496

Chapter 39 Switzerland&Matthew T. Reiter and Felix R. Ehrat 499

Ⅰ. Directors' Liability in Switzerland: The Basic Legal Regime 499

A. Introduction 499

B. Flexible One-Tier System 500

C. Board Structures, Chairman and CEO 500

D. Election and Removal of Directors, Nationality and Domicile Requirements 501

E. Delegation 501

Ⅱ. Recent Cases Dealing With Directors' Liability 502

A. Claims of the Company in Good Standing 502

B. Late Filing for Insolvency 504

C. Liability for the Issuance of Prospectuses 504

Ⅲ. Standards of Judicial Review 505

Ⅳ. Corporate Governance 505

Ⅴ. Liability Issues 506

A. Grounds for Liability and Prerequisites in General 506

B. Who Can Sue? 507

C. Derivative Actions in Particular 508

D. Who Can Be Sued? 509

E. No Thresholds and Limitations on Directors' Liability 509

F. Joint and Several Liability 510

G. No Class Actions 510

H. Costs and Fees in Liability Litigations 510

Ⅵ. Indemnification 511

Ⅶ. Directors' and Officers' Insurance 511

ⅤⅢ. Other Methods of Protection for Directors on the Board of a Swiss Corporation 512

Chapter 40 Ukraine&Timur Bondaryev and Pavlo Khodakovsky 513

Ⅰ 'National Basics' and National Legal Theories of Directors' Liabilities 513

A. Two-Tiered or Unitary Company Structure 513

B. Chairman/CEO Executive Body 515

C. Board Structures 515

D. Directors' Elections/Staggering 515

E. Directors' Term of Appointment 516

F. Delegation of Authorities (Powers) 517

G. Removal of Directors (Dismissal, Recalling, and Suspension) 517

Ⅱ. Recent Cases Dealing with Directors' Liability 518

Ⅲ. Judicial Review 519

Ⅳ. Typical Schemes/Behaviour to Avoid Directors'Liability 519

Ⅴ. Corporate Governance 520

Ⅵ. Liability Issues 521

A. Who Can Sue? 521

B. Who Can Be Sued? 522

C. 'De Facto' Director 522

D. Thresholds and Limitations/Caps of Liabilities (Limits of Directors' Liability) 522

E. Joint Liability/Solidarity 523

F. Derivative Actions 524

G. Class Actions 524

H. Relevance of Bankruptcy of Corporation 524

Ⅶ. Indemnification 524

ⅤⅢ. Directors' and Officers' Insurance 525

Ⅸ. Other Methods of Protection 525

Ⅹ. Lawyer Directorship 525

Ⅺ. Forecast on Future Legislation Development 525

Chapter 41 United Kingdom&Karla Dudek 527

Ⅰ. 'National Basics' and National Legal Theories of Directors' Liabilities 528

A. Two-Tiered or Unitary Company Structure 528

B. Chairman and CEO 528

C. Board Structures 528

D. Directors' Elections/Staggering 529

E. Directors' Term of Appointment 530

F. Delegation 530

G. Removal of Directors 530

Ⅱ. Recent Cases Dealing with Directors' Liability 531

Ⅲ. Judicial Review 532

Ⅳ. Typical Schemes/Behaviour to Avoid Director's Liability 532

Ⅴ. Corporate Governance 533

A. Board Procedures 533

B. Structure of Oversight 534

Ⅵ. Liability Issues 535

A. Who Can Sue? 535

B. Who Can Be Sued? 535

C. 'De facto' Director 536

D. Thresholds and Limitations/Caps of Liabilities 536

E. Joint Liability/Solidarity 536

F. Derivative Actions 536

G. Class Actions 537

H. Relevance of Bankruptcy of the Corporation 537

Ⅶ. Indemnification 538

ⅤⅢ. Directors' and Officers' Insurance 538

Ⅸ. Other Methods of Protection 538

Ⅹ. Lawyer Directorship 539

Ⅺ. Forecast on Future Legislation Development 539

Subject Index 541