Volume 17, Issue 4 (2014)                   CLR 2014, 17(4): 21-42 | Back to browse issues page

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Beygi Habib Abadi*[1], A, Beygi Habib Abadi M. Effects of the Mergers on Non-Assignment Clauses: A Comparative Study in Iranian and American Law. CLR. 2014; 17 (4) :21-42
URL: http://clr.modares.ac.ir/article-20-10854-en.html
1- 1. Ph.D. Department of Law, Tarbiat Modares University, Tehran, Iran
2- 2. LLM in Private Law ,University of Shahid Beheshti, Tehran, Iran
Abstract:   (13951 Views)
           One of the new innovations in Commercial Bill is codification of relatively comprehensive regulations regarding the merger of corporations. The anti-assignment clauses found in many contracts are crucial provisions for the parties looking to transfer their rights and obligations through merger. In the U.S.A., the courts and statutes in different states are split on the effects of merger on non-assignment clauses. Under most state corporate merger statutes, a merger serves to vest all assets and liabilities to merging and surviving corporations by operation of law, and not by (voluntary) assignment; this does not cause violation of non-assignment clauses in any cases; however, some other courts take the opposite view, holding that all assets and liabilities vested to these corporations are done so by assignment. A third group of courts takes a more moderate view. They are of the opinion that if a merger is accompanied by a demonstrated increase in risk or hazard to the third parties, assignment by merger is prohibited. Current Iranian laws and regulations, specifically the Commercial Bill, are silent in this regard. What is understood from these laws and regulations is that merger constitutes assignment of all assets and liabilities, and as a result, merger is a violation of non-assignment clauses.    
   
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Received: 2013/11/2 | Accepted: 2014/03/19 | Published: 2014/03/21

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