Journal of college of Law for Legal and Political Sciences

Abstract

ABSTRACT :
Division is a legal operation aims at dividing the company in to parts, each one can develop in to a new company, or these parts can integrate with existing companies, thus putting an end to the divided company. The termination a not followed by settlement of the financial obligation and the economic project of the divided company. This is a special kind of termination , it is a legal termination but not a financial one . This is called ''early termination ''.
The idea of the divided company is found by the legislator in order to keep the company project and the related legal relationships as the transformation of the financial obligation of the divided company to the new existing one al though the financial obligation is divided into parks, Accordingly the general legal succession appears.
The legal succession provides a protection for the general guaranty of the debtors.
The legislations presented by the general legal succession supported the new company to fulfill all the financial obligations and responsibilities to the debtors, At the some time the succession guarantees the right of the debtors to objection if their rights are negatively effected by the division. The mile of joint liability of the companies is not strict and it can be ruled out. The new company is not responsible for the debts of the divided company but in relation to the trans formed responsibility.
The general succession of the companies which arise from division is followed by the remaining of some contracts effective especially those which have no personal considerations. But home social and economic effects in order to enforce the basis of trust and stability in commercial transaction. Finally, the idea of general succession encourages the partners and share hoders to transform from the divided companies to the new ones. And keep their old position and status .