The UK Experience in Perspective
- Corporations, Globalisation and the Law series
Chapter 7: Corporate law and conflict of laws
We have already encountered a number of instances where corporate law comes into contact with the rules of private international law, a scenario commonly called ‘conflicts of laws’. We now need to examine the relevant issues more closely. 1 ESSENTIAL PROPOSITIONS Certain fundamental building blocks should first be established. So, for instance, it is well settled that a parent company is not to be treated as present in a jurisdiction merely because of the presence of a subsidiary.1 This principle is of great significance when considering the prevalence of multinationals with subsidiaries scattered across the globe. Companies interacting with each other may identify a legal jurisdiction by which their relationship is to be determined; but such a choice of law provision cannot exclude a jurisdiction from determining rights under its own system of property law.2 The lex situs is the dominant determinant here. 2 PLACE OF INCORPORATION V REAL SEAT One fundamental problem encountered in this field is that there are two radically different traditions at work in the treatment of corporations in private international law.3 Under the place of incorporation theory (which is favoured Adams v Cape Industries  1 Ch 433. Re Weldtech Ltd  BCC 16 – but compare Re Leyland DAF Ltd  2 BCLC 106. See C.G.J. Morse  JBL 168 for a general discussion of title retention and private international law. This article provides a helpful analysis of how the choice of law clause in a title retention arrangement has been analysed in the courts...
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