29 Questions
What is one of the key reasons why a business needs to be structured within a defined legal framework?
To limit liability
In most jurisdictions, what drives the selection of a particular form of business organization by the proprietors?
Limitation of liability
What term is commonly used in civil law countries to refer to both partnerships and limited companies?
'Company'
Which form of business organization is characterized by being owned and operated by a single individual?
Sole proprietorship
What are some general characteristics shared by forms of business organizations across different jurisdictions like the UK, USA, and France?
Broadly similar characteristics
In civil law countries like France, what term is used for a general partnership?
'Société en nom collectif'
What is the distinguishing feature of a 'company' in common law jurisdictions?
Having a separate legal identity from its members
Which form of business organization has the advantage of easy formalities and only being subject to personal income tax?
Sole trader
What is a disadvantage of a sole proprietorship business organization?
Limited capacity to raise funds
What is a consequence of a proprietor being fully liable on contracts and legal obligations?
Facing unlimited personal liability
Why may a business cease to exist if the owner of a sole proprietorship dies or becomes incapacitated?
Lack of continuity in the absence of the owner
Which business organization structure allows creditors to go after the owner's personal assets in case of losses or lawsuits?
Sole proprietorship
Which legal entity is equivalent to a British Private Limited Company (LTD) and a US Limited Liability Company (LLC)?
Société par Actions Simplifiée (SAS)
Which type of company has access to the capital markets and can list its shares on a stock exchange?
Société Anonyme (SA)
In a SAS company, which corporate body is compulsory according to the law?
President
What is the minimum share capital required for setting up a SARL company?
1 Euro
Which type of company is considered more flexible than SARL but does not have access to the capital markets?
Société par Actions Simplifiée (SAS)
Which type of company is particularly relevant for small and medium-sized companies due to its simple rules and regulations?
Société à Responsabilité Limitée (SARL)
What is a key characteristic of a company with limited liability?
The company has a legal personality separate from its human members.
What is one of the consequences of a company having a legal personality distinct from its human members?
Ability to sue and be sued in its own name
How does the limited liability of members in a company protect them?
By limiting their financial liability to their investment amount
What happens if a company's assets are not enough to cover its debts?
The members are personally responsible for the debts.
Which is not a feature of a company with limited liability?
Is treated as part of the personal assets of its members
What does it mean when it is said that a company can sue and be sued in its own name?
Legal actions are taken against the company entity, not its members personally.
In an SA (Société Anonyme), what is the minimum initial share capital required?
37,000 EUR
What characteristic of a branch distinguishes it from a subsidiary?
Separate legal entity
Which type of SA management structure includes both an executive and supervisory board?
Conseil de Surveillance only
Why is an SA considered complex and not suitable for first incorporations?
Ability for public offering of shares
What type of entity must have its director as an individual according to the text?
SARL
Explore the legal challenges faced by companies structured as limited liability entities. Learn about the distinct legal personality of limited companies and the implications it has on rights and obligations.
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