Frequently Asked Questions

UK: In the UK, what is piercing the corporate veil?

Every company has its own legal personality, which is not the same as the identities of its shareholders, directors, parent or subsidiary companies. If the company has been incorporated as a UK limited company, the liability of its shareholders is limited as they are liable to pay for their shares only but not the company's debts. As such, a company's creditors would not be permitted to issue proceedings against a company's shareholder(s). 

However, specific circumstances may permit the creditors to “pierce the corporate veil” to satisfy corporate obligations by levying against assets of the shareholders. This includes when a person evades enforcement or deliberately frustrates enforcement by inserting a company under their control. Although, if there is another legal remedy, piercing the corporate veil will not be necessary and will not be available.