IMPORTANCE OF ASSET PROTECTION IN CORPORATE WORLD
Ms. Sayantani Das
FACULTY OF LAW, INDIAN INSTITUTE OF LEGAL STUDIES, SILIGURI
With the rapid development of trade, commerce and industry in modern era has brought about a number of significant changes in the shape of a firm. With the huge expansion in the scale of operation of business, enterprises set up on the basis of sole proprietorship, or partnership and found themselves unequal to the task of meeting all the capital requirements of the present day large scale business. Thus, a new form of business organization came into existence and this is called a ‘joint stock company’ or simply a ‘company’ or ‘corporation’. While we are discussing the term company which includes association of a person to run it also includes protection of them. From the Christ era, the concept of Asset protection began to develop as a stand- alone area of the law and includes the special area of the company law that addresses key financial concerns. It’s designed to shield and insulate the company’s client wealth from personal to business liability risks. The clients are basically physicians, corporate officers, business and real estate owners who wish to practice their business or profession without jeopardizing the assets they have accumulated over the years. Asset protection consists of methods availing to protect assets from liabilities rising elsewhere. The threshold factors that are includes to analysis the asset protection grounds are firstly to identify the person engaged in the planning like if the debtor is an individual, does he or she have a spouse and to what extend they are liable. The second situation arise where the spouses engaged in activities that are equally result in lawsuits. The nature of the claim must be specific so that the asset protection can be taken as the result of the lawsuit. Over the years, there is choice of laws ruled from the state and make it possible for a person from ant state to create a trust, corporation, limited partnership or limited liability company that is governed by the laws of other nation’s jurisdiction.
