Enjoy economies of scale. Basic Materials. This is the most viable options if the capital is being invested into the business by anyone who does not wish to be involved in running it. Forming the business is complex as there are a lot of legal formalities that have to be adhered to. The company has more borrowing capacity. When a limited company is incorporated, it is considered a separate individual by the law. You have less overall control of the company. If you want your shares listed, you need to meet strict discourse and filing requirements for the London Stock Exchange, and to keep up to date with such requirements on a regular basis. Complex administration: Compared to running a business as a sole trader the administrative affairs of a Limited company are more involved. A public limited company can be listed on a securities or stock exchange or not. If the company is public, it must have a board of directors representing the main and most powerful stockholders. Immigration Permits The company accounts will be public. 30/10. Your limited company will be set up within a few short hours after your initial formation application. Healy Consultants will be pleased to assist our Clients with Kenya company setup. These public limited company disadvantages include: 1 More regulatory requirements To help protect shareholders, the legal and regulatory requirements for a public limited company are more onerous than for private limited companies. ... in the case of a public company limited by shares, ... under the provisions of Limited Partnerships Act (Cap. The PLC concept advocates that marketer should be aware, alert, and conscious about market trends and accordingly […] Advantages vs. The public cannot buy shares in the company. There is continuity after the death of a member. After serving in the United Stated Marine Corps for several years, he received his doctorate in history from the University of Nebraska. The partners in a partnership just lime in a sole proprietorship are personally liable for acts of the partnership Carbacid Investments. The advantages of Public Limited Company might stimulate you to start one, but all that glitters is not gold. Theoretically at leas, a partnership is less stable than a private company. Financial affairs are made public. This is also known as a divorce of control. LIMITED COMPANY What is the differences between Limited Company, sole proprietorship and Partnership? There are some important disadvantages of a public limited company, compared to a private limited company. In a partnership, the proprietor /s have full control of the affairs of the BN, in a Company control is via board decisions or as per share holdings held by the shareholders. ADVANTAGES OR DISADVANTAGES OF LIMITED OVER A BUSINESS NAME. A great number of businesses choose to incorporate as a company limited by shares rather than other forms, such as the sole trader, partnership, limited liability partnership (LLP) or company limited by guarantee.. Forming the business is expensive and requires a lot of money before hand. This means, in turn, that major decisions must go through the board, with debates and voting. The chairman and board of managers are appointed by the government. The private limited firm can easily be initiated and documented with the collaboration of two members. Companies Limited by shares. Kenya is a country in East Africa and a founding member of the East African Community (EAC). 8.50. The personal touch may be lost. Its capital is generally divided into transferable shares, subject to certain conditions. Business . Disadvantages. For  e.g. Business compliance is our specialty, Business startup is our passion. LLCs are currently classified as a pass-through entity. Public Company registration is a complex procedure as it requires proper documentation. A limited company is a separate entity and is a separate person in the eyes of the law. The people to whom the shares are issued are termed as shareholders. These limited liability company advantages and disadvantages may help you be able to determine if an LLC structure is the right one for your business. Recognizing 7 shareholders and 3 directors; For Public Limited Company … This means, in turn, that major decisions must go through the board, with debates and voting. It is not often many shareholders see it this way. In reality, this entails that decisions will be slow and often painful. Forming the business is expensive and requires a lot of money before hand. Since the law does not distinguish between the owner and his business, his liability is unlimited. In this case, a firm that was built up by one group (or person) can now be taken over by others since the firm has gone public. • A private company must submit annual returns on prescribed forms to the registrar of the companies immediately after the annual general meeting. Limited liability companies are structured similar to limited partnerships. He keeps the entire profit earned by him. A company limited by guarantee is its own legal entity and therefore has permanent succession. Those who buy shares have no particular interest in the firm except in that it makes a quick buck. Many professionals are now forming LLPs, because they are protected to some degree from being involved in a malpractice suit against another partner. 1. Distribution of powers; The shares of a public limited company can be bought by anyone, thereby increasing the number of members. There is continuity after the death of a member. Generally referred to as a legal being where the directors and the shareholders have limited liability in the business. No shareholder is individually liable for the payment. Shareholders are going to have a say in the direction the company takes. Many professionals are now forming LLPs, because they are protected to some degree from being involved in a malpractice suit against another partner. A public limited company is a type of large business that has offered shares to the general public and has limited liability. Disadvantages. These employees are responsible for running of the company. Secondly, it means that those who invest in the firm are protected from extreme loss if the company fails. There could be a possible loss of control, as people may find that shareholders own over 50% of the shares, entitling them to the ownership of the business. A public company is required to observe several legal formalities. There is a loss of control of the business. Limited Company Registration Home | About us | Our Services | Business Opportunities | Business for Sale | Trade Mark | Company Registration | Add Link | Business Name Registration | Download Registration Forms | Contact Us | Reference | Links | Privacy | Registration FAQ's | Terms & Conditions |. Companies must submit their accounts to Companies House annually. (For purposes of this explanation a Business Name refers to both a Sole proprietorship & Partnership) The Limited Liability Partnership combines some of the features of a traditional partnership, in particular flexibility, with the limited liability benefits more typically associated with a company. One requirement under the Companies Act that when the membership of a private company exceeds fifty, it must convert to a public company.The right to transfer shares is restricted and shares or debentures cannot be subscribed to the public. Meanwhile many companies limited by shares are formed as private companies, you may get to know through this article about the advantages and disadvantages of a public limited company. As said earlier, the financial benefit in the form of raising capital is the most distinct advantage. The company has to disclose some corporate information on the public records. The liability of the shareholders is limited to the amount paid by them during the purchase of the shares. Definition: A Public Limited Company (PLC) is a separate legal business entity which offers its shares to be traded on the stock exchange for the general public. Separate and Independent Legal Entity Public Limited Companies have several advantages and disadvantages; Advantages. Disadvantages. Below are some important advantages of having this type of public company. In some cases, the firm can be controlled by a board of directors who do not necessarily have the time for hands-on business management. – Disclosing company information on public record, including details of directors and shareholders. These limited liability company advantages and disadvantages may help you be able to determine if an LLC structure is the right one for your business. PLC enjoys huge benefits like limited liability, transferability, borrowing capacity, and others. Profits are shared either equally or as per the terms given in the written agreement. There is also the high probability of a lack of legal redress in the case of any disputes. However, most of these perceived disadvantages pale in comparison to the tax advantages, enhanced professional image, and limited liability protection you will enjoy. Its capital and largest city is Nairobi.The capital, Nairobi, is a regional commercial hub.The economy of Kenya is the largest by GDP in East and Central Africa. In comparison to a private limited company, it has more stringent regulatory requirements. The laws of almost all the countries specify the use of the word ‘limited ‘ or ‘Ltd’ after the name of the company. The working of the Public Company is subject to more strict compliances of the provision of the Companies Act 2013. Forming the business is complex as there are a lot of legal formalities that have to be adhered to. These are Public companies limited by shares and Private companies limited by shares. While owning a private limited company has several advantages, there are some disadvantages associated with it as well, such as the inability to publicly sell shares and limits on growth. And most powerful stockholders, it has an Authorized share holding which defines the limit of the LLC structure create! Be adhered to 3 directors & 7 shareholders maintain transparency less stable than a private do... 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