Business Law Essay Example | Topics and Well Written Essays - 1250 words - 8

Business Law - Essay Example It is an association of two or more people carrying on a business for profit. Maximum number of partner is 20 but in case of bank, it is only 10. There must be an agreement written or oral. As same as sole proprietorship, partnership has unlimited liability which means the partners are personally liable to pay off the debt if the business is not capable to do so. Limited Partnership: A limited partnership is one in which one ore more but not all partners have limited liability. There must be at least one general partner whose liability will be unlimited to pay all debts of the firm. This type of organization is best for funding a business. As per wiseGEEK.com, the limited partner generally has limited or no managerial authority. (wiseGEEK). To obtain a status of a limited partnership, the partners must get it registered with the registrar of partnership. It must also be kept in mind that a limited partner cannot withdraw any amount of his capital. If he does so, he will stay liable for the debts up to his original contribution of capital. C-Corporation: It is also called Traditional Corporation. A C-company is a legal form of business entity. Corporation is best for establishing a business on a large scale. It has no limit for number of shareholders even foreign citizens. It has limited liability which means shareholders are not personally liable to pay off company’s debt. Tax is imposed twice; first on the profit of the company and then on the dividends of the shareholders. In addition to this, corporation tax is paid regularly. A corporation may be a Public Limited or Private Limited. In Public Limited, shares are offered for sale to general public and have no limit to the maximum number of share holders. In Private Limited, shares are not sold to general public and the maximum number of shareholders is 50. Issuing prospect and obtaining commencement certificate are not necessary for a Public Limited but mandatory for Private