According to the Companies Act of 1956, companies have been divided broadly into public companies and private companies. This act offers a regulatory set up, based on which this classification has been made. Corporate firms keep on changing their forms, as business complexity increases and the economy grows. The law needs to consider the needs of different kinds of firms that may be operating in the market. Accordingly, it needs to come up with common principles, which all these companies would follow while formulating their corporate governance infrastructure. Entrepreneurs find risks involved in unnecessary regulations, controls and rigid structures. Small and private companies, who rarely go for public deposits or issues for their monetary needs but make the best use of in house or personal resources should enjoy the liberty and freedom of compliance and operation at a considerably low expense. The Company registration Law, in order to allow a comprehensive framework for various corporate group forms, should make sure that companies have multiple classifications. Besides, it has to come up with a seamless change-over of these firms from one category to another.
A company is said to be public limited, when it is limited by shares. In this case, no restriction exists on the number of ..
Read MoreThe business owners of this kind of companies privately own all the shares of the organization. The shareholders might hire directors,
Read MoreLimited liability partnership (LLP) is actually a combination of a partnership and a company,
Read MoreThis is a new structure in business, through which individuals can legally carry out medium and small businesses.
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