Organizational Unity as a Characteristic of a Legal Entity

The authors examine organizational unity as a characteristic of a legal entity. Based on an analysis of contemporary forms of association — such as ecosystems, integrated groups and holdings — they conclude that a community exhibiting organizational unity is not necessarily a legal entity. If participants in such an organizational unity seek to acquire legal personality, the community must meet the requirements established by law for the organizational legal forms that are permitted to participate in civil circulation as legal entities. The authors analyze the indicators of organizational unity, including stability; the presence of a common goal; coordination (cooperation and hierarchical relations); the distribution of functions within the organization; the existence of a unified regulatory space (harmonization by common standards); and external manifestations of belonging to the organizational unity. Communities organized around differing values may vary in structure, purpose and the substantive content of their activities. Membership in an organizational unity affects a subject’s legal status and the legal relations in which they participate. This has particular significance for assessing the validity of gratuitous transactions between commercial organizations, for qualifying large transactions, for identifying criteria for approving transactions under an entity’s charter, and for attributing liability for the actions of another entity.

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