A Comparative Study of Strategies for Preventing Corporate Opportunity Misappropriation in Light of the Corporate Opportunity Doctrine in Iranian, English, and American Law

Document Type : Original Article

Authors

1 PhD Candidate in Private Law, Faculty of Law, Shahid Beheshti University, Tehran, Iran

2 Associate Professor, Department of Private Law, Shahid Beheshti University, Tehran, Iran

Abstract

The aim of this article is to examine the degree of convergence and divergence between Iranian legal regulations and the accepted rules of the legal systems of England and the United States regarding the corporate opportunity doctrine. Using a descriptive-analytical method and library-based research, the study explores the necessity of ensuring that all opportunities rightfully belonging to a company are safeguarded—an issue at the heart of modern corporate governance frameworks. Conflicts of interest arising from the agency problem and the separation of ownership and control have led various legal systems to adopt clear and specific regulations to prevent managerial misconduct. This has resulted in the development of an independent legal doctrine known as the "corporate opportunity doctrine." In U.S. and U.K. courts, if a company director is found to have breached fiduciary duties by usurping an opportunity that belonged to the company, they face serious civil and criminal consequences. The legal foundation for the application of this doctrine, along with its enforcement mechanisms, also exists within Iranian law. There is a significant distinction between the concept of lost profits and that of misappropriated corporate opportunities. This article argues that a correct understanding of the elements of the corporate opportunity doctrine, aligned with rules as etlāf (deliberate destruction) , tasbīb (causation), and the fiduciary nature of a director’s authority —can allow for an interpretation of existing regulations that is both consistent with Islamic legal principles and applicable in judicial practice for addressing managerial misconduct.

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History

  • Receive Date: 12 August 2025
  • Revise Date: 19 October 2025
  • Accept Date: 08 November 2025

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