Company
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A company, abbreviated as co., is a legal entity representing an association of people, whether natural, juridical, or a mixture of both, with a specific objective. Company members share a common purpose and unite to achieve specific, declared goals.
Over time, companies have evolved to have the following features: "separate legal personality, limited liability, transferable shares, investor ownership, and a managerial hierarchy." The company, as an entity, was created by the state which granted the privilege of incorporation.
Companies take various forms, such as:
Voluntary associations, which may include nonprofit organizations.
Business entities, whose aim is to generate sales, revenue, and profit.
Financial entities and banks.
Programs or educational institutions.
A company can be created as a legal person so that the company itself has limited liability as members perform or fail to discharge their duties according to the publicly declared incorporation published policy. When a company closes, it may need to be liquidated to avoid further legal obligations. Companies may associate and collectively register themselves as new companies; the resulting entities are often known as corporate groups, collections of parent and subsidiary corporations.
== Meanings and definitions ==
A company can be defined as an "artificial person", invisible, intangible, created by or under law, with a discrete legal capacity or "personality", perpetual succession, and a common seal. Except for some senior positions, companies remain unaffected by the death, insanity, or insolvency of an individual member.
=== Etymology ===
The English word, "company", has its origins in the Old French term *compagnie* (first recorded in 1150), meaning "society, friendship, intimacy; body of soldiers", which came from the Late Latin word *companio* ("one who eats bread with you"), first attested in the Salic law (c. AD 500) as a calque of the Germanic expression *gahlaibo* (literally, "with bread"), related to Old High German *galeipo* ("companion") and to Gothic *gahlaiba* ("messmate").
=== Semantics and usage ===
By 1303, the word company referred to trade guilds. The usage of the term company to mean "business association" was first recorded in 1553, and the abbreviation "co." dates from 1769.
== Companies around the world ==
=== Africa ===
==== South Africa ====
Under the Companies Act 2008, South Africa provides for non-profit companies and several profit-company forms: private companies, public companies, personal liability companies, and state-owned companies.
==== Nigeria ====
Nigeria’s Companies and Allied Matters Act 2020 recognizes private and public companies limited by shares, companies limited by guarantee, and unlimited companies. It also enables single-member companies.
==== Kenya ====
Kenya’s Companies Act 2015 provides for private and public companies, including public limited companies. It sets naming and formation rules and consolidates modern company law in Kenya.
=== Americas ===
==== Canada ====
Companies in Canada can be incorporated at the federal or provincial level under the Canada Business Corporations Act or equivalent provincial statutes.
==== United States ====
In the United States, a company is not necessarily a corporation. For example, a company may be a "corporation, partnership, association, joint-stock company, trust, fund, or organized group of persons, whether incorporated or not, and (in an official capacity) any receiver, trustee in bankruptcy, or similar official, or liquidating agent, for any of the foregoing".
==== Brazil ====
Brazil’s main company forms are the *sociedade limitada* - governed by the Civil Code and the *sociedade anônima* - governed by the Corporations Law.
==== Mexico ====
Mexico’s General Law of Commercial Companies recognizes, among other forms, the *Sociedad Anónima* and the *Sociedad por Acciones Simplificada*, the latter added by 2016 reforms to facilitate single-shareholder startups.
=== Asia–Pacific ===
==== Australia ====
Australian companies are broadly proprietary or public under the Corporations Act 2001. Proprietary companies commonly use the suffix Pty Ltd.
==== China ====
According to the Company Law of the People's Republic of China, companies include limited liability companies and joint-stock limited companies which were founded in mainland China.
==== India ====
India’s Companies Act 2013 provides for public and private companies and introduced the One Person Company as a single-member private company. Naming conventions include “Limited” for public companies and “Private Limited”.
==== Japan ====
Japanese company law recognizes several types of companies, with the most common being the *Kabushiki Kaisha*, similar to a joint-stock company. Another popular form is the *Gōdō Kaisha*, which resembles a limited liability company. The Companies Act of 2005 established the legal framework for these and other business entities in Japan, regulating their formation, governance, and operation.
==== New Zealand ====
In New Zealand, under the Companies Act 1993, the registered name of a limited liability company must end with “Limited” or “Tāpui”.
=== Europe ===
==== European Union ====
Directive 2017/1132 consolidates EU company-law measures on incorporation, capital, disclosure and cross-border aspects for limited-liability companies. The EU also recognizes the Societas Europaea.
==== Germany ====
In Germany, the most common corporate forms include the *Gesellschaft mit beschränkter Haftung* and the *Aktiengesellschaft*. The GmbH is a private limited liability company, widely used for small and medium-sized enterprises. The AG is a public limited company used by larger firms and those listed on stock exchanges. German corporate law is governed by the *Handelsgesetzbuch*. Companies must register with the local commercial register and comply with strict disclosure and accounting standards.
==== France ====
France’s widely used forms include the "société par actions simplifiée", "société à responsabilité limitée" and "société anonyme". Government guidance sets out their main features and minimum capital and confirms SAS as the most common commercial form.
==== Russia ====
In Russia, companies are governed by the Civil Code and federal laws such as the Law on Joint-Stock Companies and the Law on Limited Liability Companies. Common types of corporate entities include the Open Joint-Stock Company, the Closed Joint-Stock Company, and the Limited Liability Company.
==== United Kingdom ====
In English law and in legal jurisdictions based upon it, a company is a body corporate or corporation registered under the Companies Acts or under similar legislation. Common forms include:
Private companies limited by guarantee.
Community interest company.
Charitable incorporated organisation.
Private companies limited by shares - the most common form of company.
Public limited companies - companies, usually large, which are permitted to (but do not have to) offer their shares to the public, for example on a stock exchange.
In the United Kingdom, a partnership is not legally a company, but may sometimes be referred to (informally) as a "company". It may be referred to as a "firm".
=== Middle East and North Africa ===
==== United Arab Emirates ====
The UAE’s Federal Decree-Law No. 32 of 2021 governs company types. Since 2021 reforms, onshore “mainland” companies in many sectors may be 100% foreign-owned.
==== Saudi Arabia ====
Saudi Arabia’s new Companies Law modernized company forms and introduced the Simplified Joint Stock Company to support startups and VC activity.
==== Egypt ====
The principal forms for private investment include the joint-stock company and the limited liability company, regulated by Law No.159 of 1981 and related investment legislation.
== Types ==
A company limited by guarantee (CLG): Commonly used where companies are formed for non-commercial purposes, such as clubs or charities. The members guarantee the payment of certain (usually nominal) amounts if the company goes into insolvent liquidation, but otherwise, they have no economic rights in relation to the company. This type of company is common in England. A company limited by guarantee may be with or without having share capital.
A company limited by shares: The most common form of the company used for business ventures. Specifically, a limited company is a "company in which the liability of each shareholder is limited to the amount individually invested" with corporations being "the most common example of a limited company". This type of company is common in England and many English-speaking countries. A company limited by shares may be a publicly traded company or a privately held company.
A company limited by guarantee with a share capital: A hybrid entity, usually used where the company is formed for non-commercial purposes, but the activities of the company are partly funded by investors who expect a return. This type of company may no longer be formed in the UK, although provisions still exist in law for them to exist.
A limited liability company: "A company—statutorily authorized in certain states—that is characterized by limited liability, management by members or managers, and limitations on ownership transfer", i.e., L.L.C. An LLC structure has been called "hybrid" in that it "combines the characteristics of a corporation and of a partnership or sole proprietorship". Like a corporation, it has limited liability for members of the company, and like a partnership, it has "flow-through taxation to the members" and, depending on local laws, may have to be "dissolved upon the death or bankruptcy of a member".
An unlimited company with or without a share capital: A hybrid entity, a company where the liability of members or shareholders for the debts (if any) of the company are not limited. In this case, the doctrine of a veil of incorporation does not apply.
Less common types of companies are:
Companies formed by letters patent: Most corporations by letters patent are corporations sole and not companies as the term is commonly understood today.
Royal charter corporations: In middle-ages Europe, before the passing of modern companies legislation, these were the only types of companies. Now they are relatively rare, except for very old companies that still survive (particularly many British banks), or modern societies that fulfill a quasi-regulatory function (for example, the Bank of England is a corporation formed by a modern charter).
Statutory companies: Relatively rare today, certain companies have been formed by a private statute passed in the relevant jurisdiction.
When "Ltd" is placed after the company's name, it signifies a limited company, and "PLC" (public limited company) indicates that its shares are widely held.
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A company, abbreviated as co., is a legal entity representing an association of legal people, whether natural, juridical or a mixture of both, with a specific objective. Company members share a common purpose and unite to achieve specific, declared goals.
Over time, companies have evolved to have the following features: "separate legal personality, limited liability, transferable shares, investor ownership, and a managerial hierarchy". The company, as an entity, was created by the state which granted the privilege of incorporation.
Companies take various forms, such as:
voluntary associations, which may include nonprofit organizations
business entities, whose aim is to generate sales, revenue, and profit
financial entities and banks
programs or educational institutions
A company can be created as a legal person so that the company itself has limited liability as members perform or fail to discharge their duties according to the publicly declared incorporation published policy. When a company closes, it may need to be liquidated to avoid further legal obligations. Companies may associate and collectively register themselves as new companies; the resulting entities are often known as corporate groups, collections of parent and subsidiary corporations.
== Meanings and definitions ==
A company can be defined as an "artificial person", invisible, intangible, created by or under law, with a discrete legal capacity (or "personality"), perpetual succession, and a common seal. Except for some senior positions, companies remain unaffected by the death, insanity, or insolvency of an individual member.
=== Etymology ===
The English word, "company", has its origins in the Old French term compagnie (first recorded in 1150), meaning "society, friendship, intimacy; body of soldiers", which came from the Late Latin word companio ("one who eats bread with you"), first attested in the Salic law (c. AD 500) as a calque of the Germanic expression gahlaibo (literally, "with bread"), related to Old High German galeipo ("companion") and to Gothic gahlaiba ("messmate").
=== Semantics and usage ===
By 1303, the word company referred to trade guilds. The usage of the term company to mean "business association" was first recorded in 1553,
and the abbreviation "co." dates from 1769.
== Companies around the world ==
=== Africa ===
==== South Africa ====
Under the Companies Act 2008, South Africa provides for non-profit companies and several profit-company forms: private companies, public companies, personal liability companies, and state-owned companies.
==== Nigeria ====
Nigeria’s Companies and Allied Matters Act 2020 recognizes private and public companies limited by shares, companies limited by guarantee, and unlimited companies it also enables single-member companies.
==== Kenya ====
Kenya’s Companies Act 2015 provides for private and public companies, including public limited companies. It sets naming and formation rules and consolidates modern company law in Kenya.
=== Americas ===
==== Canada ====
Companies in Canada can be incorporated at the federal or provincial level under the Canada Business Corporations Act or equivalent provincial statutes.
==== United States ====
In the United States, a company is not necessarily a corporation. For example, a company may be a "corporation, partnership, association, joint-stock company, trust, fund, or organized group of persons, whether incorporated or not, and (in an official capacity) any receiver, trustee in bankruptcy, or similar official, or liquidating agent, for any of the foregoing".
==== Brazil ====
Brazil’s main company forms are the sociedade limitada - governed by the Civil Code and the sociedade anônima - governed by the Corporations Law.
==== Mexico ====
Mexico’s General Law of Commercial Companies recognizes, among other forms, the Sociedad Anónima and the Sociedad por Acciones Simplificada, the latter added by 2016 reforms to facilitate single-shareholder startups.
=== Asia–Pacific ===
==== Australia ====
Australian companies are broadly proprietary or public under the Corporations Act 2001 proprietary companies commonly use the suffix Pty Ltd.
==== China ====
According to the Company Law of the People's Republic of China, companies include limited liability companies and joint-stock limited companies which were founded in mainland China.
==== India ====
India’s Companies Act 2013 provides for public and private companies and introduced the One Person Company as a single-member private company; naming conventions include “Limited” for public companies and “Private Limited”.
==== Japan ====
Japanese company law recognizes several types of companies, with the most common being the Kabushiki Kaisha, similar to a joint-stock company. Another popular form is the Gōdō Kaisha, which resembles a limited liability company. The Companies Act of 2005 established the legal framework for these and other business entities in Japan, regulating their formation, governance, and operation.
==== New Zealand ====
In New Zealand, under the Companies Act 1993, the registered name of a limited liability company must end with “Limited” or “Tāpui”.
=== Europe ===
==== European Union ====
Directive 2017/1132 consolidates EU company-law measures on incorporation, capital, disclosure and cross-border aspects for limited-liability companies the EU also recognizes the Societas Europaea.
==== Germany ====
In Germany, the most common corporate forms include the Gesellschaft mit beschränkter Haftung and the Aktiengesellschaft. The GmbH is a private limited liability company, widely used for small and medium-sized enterprises. The AG is a public limited company used by larger firms and those listed on stock exchanges. German corporate law is governed by the Handelsgesetzbuch. Companies must register with the local commercial register and comply with strict disclosure and accounting standards.
==== France ====
France’s widely used forms include the "société par actions simplifiée", "société à responsabilité limitée" and "société anonyme" government guidance sets out their main features and minimum capital and confirms SAS as the most common commercial form.
==== Russia ====
In Russia, companies are governed by the Civil Code and federal laws such as the Law on Joint-Stock Companies and the Law on Limited Liability Companies. Common types of corporate entities include the Open Joint-Stock Company, the Closed Joint-Stock Company, and the Limited Liability Company.
==== United Kingdom ====
In English law and in legal jurisdictions based upon it, a company is a body corporate or corporation company registered under the Companies Acts or under similar legislation. Common forms include:
Private companies limited by guarantee
Community interest company
Charitable incorporated organisation
Private companies limited by shares - the most common form of company
Public limited companies - companies, usually large, which are permitted to (but do not have to) offer their shares to the public, for example on a stock exchange
In the United Kingdom, a partnership is not legally a company, but may sometimes be referred to (informally) as a "company". It may be referred to as a "firm".
=== Middle East and North Africa ===
==== United Arab Emirates ====
The UAE’s Federal Decree-Law No. 32 of 2021 governs company types. Since 2021 reforms, onshore “mainland” companies in many sectors may be 100% foreign-owned.
==== Saudi Arabia ====
Saudi Arabia’s new Companies Law modernized company forms and introduced the Simplified Joint Stock Company to support startups and VC activity.
==== Egypt ====
The principal forms for private investment include the joint-stock company and the limited liability company, regulated by Law No.159 of 1981 and related investment legislation.
== Types ==
A company limited by guarantee (CLG): Commonly used where companies are formed for non-commercial purposes, such as clubs or charities. The members guarantee the payment of certain (usually nominal) amounts if the company goes into insolvent liquidation, but otherwise, they have no economic rights in relation to the company. This type of company is common in England. A company limited by guarantee may be with or without having share capital.
A company limited by shares: The most common form of the company used for business ventures. Specifically, a limited company is a "company in which the liability of each shareholder is limited to the amount individually invested" with corporations being "the most common example of a limited company". This type of company is common in England and many English-speaking countries. A company limited by shares may be a publicly traded company or a privately held company.
A company limited by guarantee with a share capital: A hybrid entity, usually used where the company is formed for non-commercial purposes, but the activities of the company are partly funded by investors who expect a return. This type of company may no longer be formed in the UK, although provisions still exist in law for them to exist.
A limited liability company: "A company—statutorily authorized in certain states—that is characterized by limited liability, management by members or managers, and limitations on ownership transfer", i.e., L.L.C. LLC structure has been called "hybrid" in that it "combines the characteristics of a corporation and of a partnership or sole proprietorship". Like a corporation, it has limited liability for members of the company, and like a partnership it has "flow-through taxation to the members" and depending on local laws may have to be "dissolved upon the death or bankruptcy of a member".
An unlimited company with or without a share capital: A hybrid entity, a company where the liability of members or shareholders for the debts (if any) of the company are not limited. In this case, the doctrine of a veil of incorporation does not apply.
Less common types of companies are:
Companies formed by letters patent: Most corporations by letters patent are corporations sole and not companies as the term is commonly understood today.
Royal charter corporations: In middle-ages Europe, before the passing of modern companies legislation, these were the only types of companies. Now they are relatively rare, except for very old companies that still survive (particularly many British banks), or modern societies that fulfill a quasi-regulatory function (for example, the Bank of England is a corporation formed by a modern charter).
Statutory companies: Relatively rare today, certain companies have been formed by a private statute passed in the relevant jurisdiction.
When "Ltd" is placed after the company's name, it signifies a limited company, and "PLC" (public limited company) indicates that its shares are widely held.
== See also ==
Corporate personhood
List of company registers
List of largest employers
Lists of companies
Types of business entity
== References ==
== Further reading ==
Alan Dignam and John Lowry. Company Law. Oxford: Oxford University Press, 2020. ISBN 978-0-19-928936-3.
John Micklethwait and Adrian Wooldridge, The Company: A Short History of a Revolutionary Idea. New York: Modern Library, 2003.
"Company" . Encyclopædia Britannica. Vol. 6 (11th ed.). 1911. pp. 795–803.
== External links ==
"Labor and Employment". Government Information Library. University of Colorado at Boulder. Archived from the original on June 12, 2009. Retrieved August 5, 2009.
"Get Information About a Company". Gov.UK.
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