Derivative Action and its Procedures: Comparative Survey in Law of Iran and England

Derivative action is an action filed by shareholders against corporate directors in order to recover corporate’s rights. This mechanism is set up to have the directors answerable for their failure in carrying out their duties. Prior to the CA 2006, Foss v. Horbottle rule deprived shareholders of taking any action against directors but in exceptional cases. Acknowledging the right of filing derivative action and how to apply it, as shareholders’ rights, for the first time the Act 2006 extended the circumstances in which such a right may be claimed.In Iranian Law, section 276 of the Amendment to the Commercial Act 1347 refers to possibility of filing a derivative action. The same is provided vastly in the Bill 1384 in section 473. Regarding new development of legal systems in this area particularly in English Law, providing new provisions seems to be a necessity.