This research paper aims to review and compare the solutions regarding Contracting with Oneself as found in Switzerland and Hong Kong. In a first part, the paper provides a definition of the term ”Contracting with Oneself”. The second part investigates the different solutions of Switzerland and Hong Kong.
Conflict of interests is regarded as a ”cross-cutting problem” of corporate governance and has been defined as a ”situation in which an individual or a corporation (either private or government) is in a position to exploit a professional or official
capacity in some way for their (or that of a related party) personal or corporate benefit”. Due to the negative effects on a company in general, conflict of interests need to be avoided.
There are many situations where a conflict of interests may arise. Contracting with Oneself is one of them and is very closely related to the definition as provided above. Contracting with Oneself, like conflict of interests in general, could be for the advantage but also for the disadvantage of a company and therefore, as it has been correctly described ”may not, in and of itself, be an evidence of wrongdoing”.
However, the problem of Contracting with Oneself is inherent as it could be misused for diverting company’s assets to a specific person (e.g. ”executive perquisites, excessive compensation, transfer pricing, appropriation of corporate
opportunities”, etc. The question in this regard is how Contracting with Oneself can be addressed by law and regulation and how to find the golden path between allowing it, if it is for the overall benefit and when and how to restrict it, if it has a negative effect. Additionally, the restrictions must be effective before Contracting with Oneself becomes a legal problem that may lead to a personal benefit of a specific person.
Inhaltsverzeichnis (Table of Contents)
- 1 Introduction
- 2 Definition of Contracting with Oneself
- 3 Contracting with Oneself in Switzerland
- 3.1 General Principles and Legal Foundation.
- 3.2 Rules for Admissability of Contracting with Oneself
- 3.2.1 Transactions based on Authorization or Consent of a Superior Body . .
- 3.2.2 Transactions for the pure Benefit of the Principal
- 3.2.3 Transactions for Settling an Obligation
- 3.2.4 Transactions with a Market Price . .
- 3.2.5 Transactions amongst Group Companies
- 4 Contracting with Oneself in Hong Kong
- 4.1 General Principles and Legal Foundation.
- 4.2 Rules for Admissability of Contracting with Oneself
- 4.2.1 Conflict Rules
- 4.2.2 Consent
- 4.3 Transactions in breach of Conflict of Interests
- 4.4 Admissability of Contracting with Oneself.
- 4.4.1 Transactions amongst Group Companies
- 5 Conclusion
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This legal comparison between Switzerland and Hong Kong aims to define and analyze the concept of "contracting with oneself" in the context of corporate governance. The paper explores the legal principles and rules governing such transactions in both jurisdictions, highlighting similarities and differences in their respective legal frameworks.
- Definition and legal framework of "contracting with oneself"
- Rules for admissibility of self-dealing transactions
- Role of consent and authorization in preventing conflicts of interest
- Comparative analysis of Swiss and Hong Kong legal approaches
- Implications for corporate governance and shareholder remedies
Zusammenfassung der Kapitel (Chapter Summaries)
The introduction sets the stage for the legal comparison, defining the scope of the study and outlining the key questions to be addressed. Chapter 2 provides a comprehensive definition of "contracting with oneself," laying the foundation for the subsequent analysis. Chapter 3 delves into the Swiss legal framework, examining general principles and specific rules for the admissibility of self-dealing transactions, including transactions based on authorization, transactions for the benefit of the principal, transactions for settling obligations, transactions with a market price, and transactions among group companies. Chapter 4 shifts focus to Hong Kong, exploring the legal principles and rules governing self-dealing transactions, including conflict rules, consent requirements, transactions in breach of conflict of interests, and the admissibility of transactions among group companies.
Schlüsselwörter (Keywords)
Corporate governance, shareholder remedies, self-dealing, conflict of interest, legal comparison, Switzerland, Hong Kong, authorization, consent, group companies, legal framework, admissibility, transactions.
- Quote paper
- Martin Grod (Author), 2015, Corporate Self-Dealing. A Legal Comparison between Hong Kong and Switzerland, Munich, GRIN Verlag, https://www.hausarbeiten.de/document/333734
