The Protection of Corporate Creditors under Ethiopian Share Company Law in Light of International Recommendations

Dessie, Tigist

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dc.contributor.author	Dessie, Tigist
dc.date.accessioned	2021-02-23T06:55:58Z
dc.date.available	2021-02-23T06:55:58Z
dc.date.issued	2021-02-23
dc.identifier.uri	http://ir.bdu.edu.et/handle/123456789/11927
dc.description.abstract	Incorporate form of business venture where the liability of the member is not beyond the amount of their investment, the protection of creditor has become a mandatory norm. Being the creditors of such limited liability companies by itself brought the risk of default payment as the creditors cannot look after the personal property of individual shareholder in order to meet their claims. As a result of this shield of limited liability, shareholders can be incentivized to act opportunistically towards its creditors by using the privilege that the limited liability granted them. Due to that, any framework sought for the protection of corporate creditors needs to consider the principle of limited liability as additional problem. Depending on the prevailing legal tradition, the protection of corporate creditors is provided either through the instrumentality of statutory legal provision incorporated in different legislation or through contract or also known as self-help mechanisms. This study tried to explore the protection of corporate creditors under the Ethiopia share company law in light of accepted international principles. Thus, this paper critically analyzes whether the Ethiopia share company law provides adequate protection for corporate creditors by using important principles such as OECD Principles of corporate governance and the doctrine of capital maintenance. To accomplish this task, the researcher employed qualitative legal research method by analyzing laws including the commercial code, financial reporting proclamation no 847/2014 and other relevant legislations. What is more, the researcher has also interviewed experts from MOT, Business licensing and registration institution, Addis AbabaUniversity, AABE and Document Authentication and Registration Agency. The main findings of the research are: the existing share company law is not adequate in protecting corporate creditors and to the worst, the draft commercial code does not rectify most of these problems identified. Hence the study found that, there is a poor mandatory disclosure regime in Ethiopia for the purposes of corporate creditor protection, those provision of capital maintenance does not adequately protect the rights of corporate creditors and the law also failed to incorporate those rules of protection which control the opportunistic behavior of directors in the near ofcompany’s insolvency. Based on such findings, the researches recommend that the country need to revisit the Ethiopian share company law so as to adequately protect corporate creditors.	en_US
dc.language.iso	en	en_US
dc.subject	Law	en_US
dc.title	The Protection of Corporate Creditors under Ethiopian Share Company Law in Light of International Recommendations	en_US
dc.type	Thesis	en_US