Challenges and development of investment protection mechanisms in georgian corporate law : is there a middle ground?
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Georgia is a Civil Law country and a developing economy. German and other European scholars were actively helping Georgian government in forming the new legislation including in Corporate Law. After 2003, the principles of the common law were actively implemented in Georgian legislation, which diverted the focus of academia, practitioners and businesses to different and unconventional ways of investment protection that became increasingly popular. The aim of the article is to discuss the challenges of the investment protection mechanisms of the Corporate Law in Georgia within the frames of influence of Common Law and Civil Law. The influence of both legal systems created the unique platform of research and debate. Authors of this article reviewed the relevant academic literature on investment protection mechanisms, but they were unable to find the combination of analysis on minimum capital requirement, piercing the corporate veil, pre-emptive rights and fiduciary duties. Simultaneously, no scholar has emphasized the role of piercing the corporate veil to balance the interests of the creditors during the absence of minimum capital requirement; secondly, pre-emptive rights are not widely considered as the alternative to Poison Pills and with this, the effect of pre-emptive rights as the instrument for antitakeover regulations is diminished. At the same time, the link between the pre-emptive rights and fiduciary duties is also very weak which reduces its antitakeover features and affects the investment protection mechanisms. Article aims to fill this gap.
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