What Should Know Controling Company Which Incorporates Subsidiary and Appoints it‘s Nominee Director?

2015-09-15 15:30
Legal news

In international business practise legal entities often use services of nominee directors‘ or nominee shareholders‘. There is not any legal provisions about such case in Lithuanian law, however, the courts of Lithuania examine such questions in various civil or criminal procedure related with commercial activities of companies and directors of companies. The Article 2.87 part 7 of Lithuanian Civil Code provides that member of the Board who fails to comply his obligations to the company required by Civil Code or instruments of company‘s incorporation should completely compensate the damages made for legal entity if legal acts or instruments of company‘s incorporation do not provide otherwise.  In the article are discussed whether nominee director who made damages for the company because he made decisions in accordance to his appointing shareholders' (controling company, beneficial owner, etc.) order should be legaly liable for these damages. The full article in Lithuanian you can read here.