It is generally formed by small businessmen who want to own a company but keep its affairs private. A joint stock company may be incorporated as a private or public company or one person company. 2404.67 Billion. ADVERTISEMENTS: After reading this article you will learn about:- 1. The biggest advantage of forming a public limited company (PLC) is that it grants the ability to raise capital by issuing public shares. It helps in reducing the overall risk of the company, as capital is invested in the diversified number of securities. A public limited company ('PLC') is a company that is able to offer its shares to the public. There are so many characteristics of a public limited company. However, shares in a public company can be freely sold and traded to the general public and their shares can be listed on a stock exchange. Characteristics of Public Corporations: Public corporations have certain basic differences with departmental managements. of transferable shares and carrying limited liability. A public limited company (PLC) is simply a limited liability company, similar to a private limited company, that has chosen to raise capital by offering shares to the general public. A company that can own property on its own name. Further, the members of such a company have limited liability. Characteristics of private limited company is mentioned below. The main characteristic and advantage of a public limited company is that you can raise capital through external investors, in essence, offering shares in your company to the public. It comes into being from the date mentioned in the certificate of incorporation. According to the Companies Act 2013, a public limited company is a separate legal entity. It is the superior form of business and hence compliances and controlling provisions are applicable as per Companies Act, 2013. Memorandum is defined in section 2(56) of Companies Act 2013. A private limited company is limited by shares or by guarantee. There is no restriction on the number of members but the minimum number is seven. The essential characteristics of a company may be listed as under: 1. So do not hesitate to promote your position in the most profitable way. Its transferability attracts new shareholders, and transparent operations permit to occupy a good position on the market of goods and services. READ ALSO: How to register a business name in Nigeria online, Leave your email to receive our newsletter, Get the hottest stories from the largest news site in Nigeria, Drop your mail and be the first to get fresh news, Reach out to Access Bank customer care service using these contacts, Start your business right now with the best business ideas in Ngeria, 10 emerging business opportunities in Nigeria in 2019, Businesses with low capital you can start to get high profit in Nigeria, Small-scale business idea: VTU in Nigeria. So it is for you to decide to risk or not. A public company is a company which issued securities through initial public offering and has an operation of securities at least one stock exchange or over the counter market. Unlike a conventional limited liability company, the authorized capital of a PLC is divided into shares that can be traded on the stock exchange. This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply. A private limited company is formed with a minimum capital of ₹1,00,000. One favorable element of owning a private restricted organization is that the budgetary risk of investors is constrained to their offers. In the contemporary world of terms and numbers, it can be challenging to figure out some notions and differences. Transferability of shares: Easier in case of Public. A Public Limited Company (PLC) is set up where the company intends to get itself publicly listed on the Stock Exchange. Public Limited company. Private limited. A public company is a company that has permission to issue registered securities to the general public through an initial public offering (IPO) and it is traded on at least one stock exchange market. The public limited company can issue prospectus for inviting the public to subscribe its shares. Some key characteristics of a public company include the raising of capital through selling shares of stock and being a legal entity that is theoretically immortal. There is limited liability for the shareholders. An LLC is somewhat of a hybrid between a partnership and a corporation. The MOA is a major document in the formation of public company. How to Set Up a Credit Rating Agency in India? It is more difficult to rule public company in comparison with the private one, for instance under certain circumstances; an ordinary enterprise may be allowed to present abbreviated financial statements, while an open public one is obliged to send to the state tax authorities complete financial statements from its activities. Moa is a separate legal entity that has separate identity from its shareholders/members shares of a whose. It offers shares to the death or disability, the number of members: a limited! Not necessary for a private limited company has to file its Annual with. 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