11.Формы собственности. Частное предпринимательство/Партнерство /общеcтво с ограниченной ответственностью(ооо)/ Открытое акционерное общество (оао). Порядок регистрации.

Business ownership

1. Sole trader – earliest form of business, owned and managed by one person (hired staff – not proprietors).

Registration in trade register, license, books reflecting the results of business activities.

Advantages:

• _{easy to set up} (if you have capital)

• _{confidential finances}

• _{sole possession of profits}

• _{freedom in decisions}

• _offer personal service

• _{can adapt to social needs}

• _{keep profit for yourself}

Disadvantages:

• _{unlimited liability} (responsible for all debts himself, can be made to sell his posessions)

• _{limited capital for new projects}

• _{tied to business} (a lot of work to be done)

2. Partnership (unlimited) – joint property and capital of its members (up to 20 people), profit distributed proportionately to the share of participation, equal and collective responsibility;

Registration: any name, but must not add ‘Ltd.’

Advantages:

• _{more capital available}

• _{new ideas}

• _{easy to form}: no complex legal problems

• _{sharing of work} by partners

• _{losses shared} among partners

• _{specialization in professional partnerships}

Disadvantages:

• limited capital for a large scale business

• disagreements possible

• unlimited liability (personal possessions can be sold)

• no continuity (partnership breaks up on the death, retirement, bankruptcy)

Limited (or sleeping) Partnerships – if there is at least one working partner with unlimited liability, others can invest capital in a firm. They are not aloud to do any work, but share in profits. They have to share in any losses (but up to the amount they have put in)

3. Private limited company – number of people (more than 20) invest money by buying shares (cannot be sold through Stock Exchange, only to people of whom the director approve, board of directors appointed, dividends paid on each share if company makes profit.Shares can be partly paid.Shareholder is liable only for invested by him money.

Registration:

Memorandum of Association + Articles of Association are sent to Registrar of Companies = Certificate of Incorporation

Memorandum of Association - sets out the detailed name of the company, the type of business, the total share capital and the kind shares it will issue (deals with the company)

Articles of Association - set of rules stating how the company run itself internally: powers, duties of directors, staff, salary, issue and transfer of shares . Covers the powers of the directors, the issue and transfer of shares, the salary. (deals with the outside of the world)

Certificate of Incorporation - permission to start trading

Advantages:

• _{more capital than partner}ship

• _{limited liability} (liable only for invested amount)

• _continuity

• _{legal position as compan}y

Disadvantages:

• _{expensive to set up} – heavy legal and accountancy fees + large government stamp duty

• _{shares cannot be sold to public} - may limit capital

• _{expensive to audit accounts carefully}

4. Public limited company – more than 2 shareholders (no maximum number), minimum capital – 50 000 pounds, shares can be advertised and sold to the public, operates on large scale (must reveal activity to the public).

Registration:

1. Memorandum of Association + Articles of Association + Prospectus (set out for public company’s aims, background) to the Registrar of Companies = Certificate of Incorporation (But cannot start trading yet)

2. Then company advertises its new shares for sale or sells them privately to pension funds, insurance companies and other big financial institutions

3. When it has sold the proposed number of shares or has enough capital it can apply to the Registrar of Companies and get Trading Certificate

Advantages:

• _{almost limitless capital (shares)} - can advertise for capital from the public in the form of shares and debentures

• _{large scale of operation (huge projects undertaken)}

• _{limited liability (to the amount of investment)}

• _continuity

• _{legal identity of the company}

Disadvantages:

• _{expensive and complex to set up}

• _{critics of management by shareholders may hinder the progress of the company}

• _{inflexibility, inefficiency of management, overstaffing}

• _{much information must be revealed(companies Act 1967-large corporation can work against government wishes)}

• _{liable to takeover bids and political pressure} (much information goes public)