Types of Commercial Companies

Types of Commercial Companies

• Sole Proprietorship: A business owned and operated by one individual, with unlimited personal liability.
• Partnership: A business owned and operated by two or more individuals, with unlimited personal liability.
• Limited Liability Company (LLC): A business that combines the benefits of partnerships and corporations, with limited personal liability.
• Corporation: A business that is a separate legal entity, with limited personal liability and easy transfer of ownership.

Characteristics of Commercial Companies

• Separate Legal Entity: Commercial companies are separate from their owners, with their own legal rights and obligations.
• Limited Liability: Owners' personal assets are protected in case of business debt or lawsuits.
• Perpetual Existence: Commercial companies can continue to exist even if owners die or leave the company.
• Easy Transfer of Ownership: Ownership can be easily transferred through the sale of shares.
• Professional Management: Commercial companies can hire professional managers to run the business.

Purposes of Commercial Companies

• Profit Maximization: To earn profits for shareholders.
• Customer Satisfaction: To provide goods and services that meet customer needs.
• Job Creation: To provide employment opportunities for individuals.
• Economic Growth: To contribute to the growth and development of the economy.

Functions of Commercial Companies

• Production: To produce goods and services.
• Marketing: To promote and sell goods and services.
• Finance: To manage the financial aspects of the business.
• Human Resources: To manage the workforce and labor relations.
• Research and Development: To innovate and improve products and services.

Types of Commercial Companies

• A sole proprietorship is a business owned and operated by one individual, with unlimited personal liability.
• A partnership is a business owned and operated by two or more individuals, with unlimited personal liability.
• A Limited Liability Company (LLC) combines the benefits of partnerships and corporations, with limited personal liability.
• A corporation is a separate legal entity, with limited personal liability and easy transfer of ownership.

Characteristics of Commercial Companies

• Commercial companies have a separate legal entity, with their own legal rights and obligations.
• Limited liability protects owners' personal assets in case of business debt or lawsuits.
• Commercial companies can continue to exist even if owners die or leave the company, known as perpetual existence.
• Ownership can be easily transferred through the sale of shares.
• Commercial companies can hire professional managers to run the business.

Purposes of Commercial Companies

• The primary goal of commercial companies is to earn profits for shareholders, known as profit maximization.
• Providing goods and services that meet customer needs leads to customer satisfaction.
• Commercial companies create employment opportunities for individuals, contributing to job creation.
• Commercial companies contribute to the growth and development of the economy, known as economic growth.

Functions of Commercial Companies

• The production function involves producing goods and services.
• The marketing function involves promoting and selling goods and services.
• The finance function involves managing the financial aspects of the business.
• The human resources function involves managing the workforce and labor relations.
• The research and development function involves innovating and improving products and services.

Monetary Shares Circulation

• Company shares are not negotiable until commercial registration is finalized.
• Exception: capital increase shares based on transferring debentures into shares are negotiable after transfer operation measures are completed.

Promoter Shares and In-Kind Shares Negotiability

• Shares given in return for quotas in kind or subscribed by promoters before the advertisement of balance sheets, profit and loss accounts, and other closing account documents for two complete years are not negotiable.
• Shares subscribed by promoters in each increase in capital are not negotiable before the elapse of the two-year period.
• This limit also applies to capital increase shares given in return for quotas in kind, with the two-year period calculated from the date of amending the company data in the commercial registration.

Debentures

Debentures Issuance

• Debentures are issued in the form of nominal certificates with a unified value and are negotiable.
• Debentures of the same issue represent equal rights for their holders against the company.
• Debenture certificates are signed by two members of the board of directors.
• Debentures have coupons with the same serial numbers and include the debenture serial number.

Power to Issue Debentures

• Debentures are issued by a resolution of the general assembly upon a proposal by the board of directors, including a report by the accounts censor.
• The resolution may include the issue total value, guarantees, and bonds to be ensured for debenture holders.
• The board of directors has the power to choose the time of issue and other terms related to the debentures within two years of the general assembly resolution.

Capital Paid Up Before Issuing Debentures

• A company cannot issue debentures unless the total issued capital is paid up in full.
• The total value of previously issued and new debentures to be issued cannot exceed the net value of the company assets as stated by the accounts censor.
• Violation of these provisions may result in the cancellation of the issue by the competent law court.

Issuing Debentures Before Capital Being Paid Up in Full

• Exceptions to the preceding article allow companies to issue debentures before capital is fully paid up in the following cases:
  • Debentures are guaranteed to their total value by a priority mortgage on the company's fixed assets.
  • Debentures are guaranteed by the State.
  • Debentures are completely subscribed by banks or companies working in the field of securities.