The Feasibility of Establishing a Single-Member Company in Iranian Legal System

Articles in Press

Document Type : Original Article

Author

Associate Professor, Private Law, Department of Law Factulty of Theology, Azarbaijan Shahid Madani University, Tabriz, Iran.

10.48300/jlr.2024.437900.2562

Abstract

Traditionally, in various legal systems, the presence of at least two partners is considered as a condition for the establishment of the legal personality of the company, and based on this, the formation of a company with a single member is not accepted. The foundations of such an approach are usually over-reliance on the contractual nature of the company, the rule of unity of assets, the possibility of abusing the form of a single-partner company to harm creditors. But over time, these precautions have been abandoned and the legislators of different countries, including Iran, have moved towards the recognition of a single partner company. The identification of a single partner company in a limited liability company in the Commercial Law Amendment Bill - which has not yet been approved by the executive branch - raises the question of whether the identification of this type of company is compatible with the structure of Iran's legal system? This research intends to search for the answer to this question through a descriptive and analytical method and with a comparative approach, and in short, it can be said that the identification of a single partner company does not conflict with the structure of the Iranian legal system, and a limited liability company is the best format for establishing these types of companies.

Keywords

Journal of Legal Research

Articles in Press, Accepted Manuscript
Available Online from 22 February 2024

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