DISTRIBUTION COMPANY LIMITED AND JOINT STOCK COMPANY.

Are you wondering what kind of company to choose to do business? Should the establishment of a limited company or a joint stock company is a question of many Start ups today.

Below, Tasco would like to state the difference between these two types of businesses:

Joint stock companies and limited liability companies have relatively similar construction models with different number of members participating in capital contribution to the management and operating apparatus of the company. That is why it is important to distinguish a limited company from a joint stock company when choosing which type to register for a company establishment.

Participants

Limited company: The participating members are individuals or organizations that contribute capital to establish the company. All issues of changing the manager of capital contributions must comply with the Board of Members. For a one-member limited liability company, only 1 member is the owner of the company. For a limited liability company with 2 TVs or more, the minimum number of members is 2 and maximum is 50.

Joint stock company: affected by the owner of very large company shares. Therefore, the influence from outside can happen when being acquired or bought back with a large ownership ratio. The minimum number of shareholders is 3 shareholders and there is no limit on the maximum number of shareholders.

Raising capital

Joint-stock companies are allowed to issue shares and bonds to increase investment capital. Meanwhile, the limited company is not allowed to issue shares and bonds, but only calls for more members to contribute capital to increase capital.

Company management and administration

A more complex JSC management apparatus includes a board of directors and a board of shareholders. The Board of Directors consists of the chairman of the board of directors and members of the board of directors.

A much simpler limited liability company has only a board of members consisting of a chairman of the Members' Council and capital-contributing members.

Advantages and disadvantages of the limited company and the joint stock company:

• Co., Ltd:

• Advantages:

- The company members are only responsible for the debts and other liabilities of the company up to the amount of capital contributed to the company;

- The management and operation of the limited company is not too complicated due to the limited number of members;

- The regime of transferring the contributed capital is strictly adjusted so the investor can easily control the change of company members.

• Defect:

- Due to the name and limited liability regime, the prestige of the company before its partner is somewhat affected;

- The capital mobilization of the limited company is restricted due to the lack of rights to issue shares.

• Joint Stock Company:
• Advantages:

- The company members are only responsible for the debts and other liabilities of the company up to the amount of capital contributed to the company;

- The operating capacity of the joint stock company is very wide, in almost all fields and trades;

- Transferring shares easily, attracting many investors from many economic sectors to contribute capital and buy shares.

- The capital structure of a joint stock company is flexible, creating conditions for many people to contribute capital to the company;

-The ability of the joint stock company to raise capital is very high through the issue of shares to the public;

• Defect:

- The management and operation of a joint stock company is very complicated because the number of shareholders can be very large, so it is easy to differentiate into groups of shareholders opposing each other in interests;

- The process of establishing and managing a joint stock company is also more complicated than that of other types of companies because it is strictly bound by the provisions of law, especially the financial and accounting regime.

Contact hotline 0975480868 for free consultation and determine the most suitable type of business for you!