Explain The Types Of Joint Stock Company?


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Connor Sephton answered
There is really only one central type of joint stock company - this type of business entity is formed by two or more shareholders (stockholders) who own all of the stock assets in their company. However, joint stock companies may have different characteristics, depending upon how they are set up. For example, most joint stock companies will have a limited liability clause for their members...which spreads risk amongst the owners of the joint stock company. In a company with only one owner, risk is all on the owner's head. Many people prefer to minimize or share risk with a partner of a joint stock company.

Other Characteristics Of A Joint Stock Company

• Endless Succession - With this type of company, succession is perpetual; this means that a company will endure even after its members are dead. Stocks, or shares, will be passed on, and the company will continue until it is formally dissolved according to legal rules and regulations.

• Distinct Legal Identity - When this type of joint stock company is formed, it becomes a separate and distinct legal body; for example, property purchased by the company will not be in an owner's name, it will be in a company's name. In a sense, the company is like a human being, except it is a corporate entity...all contracts and business dealings with others will be done under the company's name, just as though the joint stock company is a single individual.

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