A joint-stock organization can be described as an industrial employer this is owned collectively with the aid of using all of its owners. The stocks signify the reality that every shareholder owns a selected quantity of equity in the firm.
Are you wondering to know more about the registration of joint stock company is. Let’s move on.
This form of the company can be observed everywhere around the global and is the maximum not unusual place form of business enterprise. A Joint-Stock Company is shaped whilst a collection of people split an organization’s capital into transferrable stocks. Purchasing stocks is the best approach to growing to be part of this ownership network.
How Is a Joint Stock Company Registered
A joint stock company (also known as a joint stock corporation or joint stock association) is a type of business organization that is owned by shareholders who have limited liability for the company’s debts and obligations. To register a joint stock company, you will need to follow these steps:
- Choose a name for your company: The name of your company must be unique and should not be identical or similar to any existing company name.
- Choose the business structure: A joint stock company can be registered as a public or a private company. A public company is one that is listed on a stock exchange and its shares can be bought and sold by the public. A private company is one that is not listed on a stock exchange and its shares can only be bought and sold among its shareholders.
- Prepare the articles of association: The articles of association are the rules and regulations that govern the internal affairs of the company. They should be drafted in accordance with the relevant laws and regulations of the country where the company is being registered.
- Register the company: To register the company, you will need to submit the articles of association and other required documents to the relevant authorities. This process may vary depending on the country where the company is being registered.
- Obtain necessary licenses and permits: Depending on the nature of your business, you may need to obtain various licenses and permits to operate legally.
- Appoint directors and shareholders: A joint stock company must have at least one director and one shareholder. The directors are responsible for managing the company’s affairs, while the shareholders own the company and have the right to vote on important matters at shareholder meetings.
Under Which Act Is a Joint Stock Company Registered
The company is an artificial and fecal person. These companies are registered under the Companies Act 1994. Most countries have a corporate registry. He registered companies incorporated and established by and under the law. On this basis, he also issued a charter of incorporation. The procedure for a corporation is more expensive than for other companies.
What Documents Are Required to Register Joint Stock Company
Submission of documents:
At this stage, the initiator collects forms from public company registrars, adds some documents, and submits the forms. These documents are
- A copy of the Articles of Association
- A copy of the Articles of Association. In the case of a joint-stock company amending the Articles of Association, the promoters must submit a signed declaration.
- Initiators wishing to become directors must provide their name, address, and occupation.
- Directors should subdivide the consent form.
- Directors must execute a Qualifying Stock Agreement.
- Description of the key capital of the joint-stock company’s total capital.
- These documents, along with the registration form, must be presented to the registrar and any required fees must be paid to the registrar free of charge.
What Are the Two Types of Joint Stock Company
There are 2 main types of joint stock companies:
A public joint stock company: This is a company that is owned by shareholders, and its shares are traded on a stock exchange. A public joint stock company is required to have a minimum of seven shareholders and must make its financial information available to the public.
A private joint stock company: This is a company that is owned by a smaller group of shareholders, and its shares are not traded on a stock exchange. A private joint stock company is not required to disclose its financial information to the public.
In both types of joint stock companies, the shareholders are not personally liable for the company’s debts. They are only responsible for the amount of money they have invested in the company’s shares.
What is structure of joint stock company?
Joint stock company based on Incorporation
Registered Company: A registered company is any business incorporated under company law in the particular state where it is located.
Chartered Company: Chartered companies are established by royal charter. Such companies often have commercial business privileges and are signed by the country of incorporation.
Statutory Company: A statutory firm is one to which the Parliament has specifically granted legal standing. These companies aid in the delivery of public amenities and services. The act specifies the company`s objectives, rights, and legal power.
Joint Stock Company Based on the Number of Members
Unlimited Liability Company: Shareholders of such companies are responsible for their personal property and property.
Limited Liability Company: A limited liability company is the most common form of company. The limit of liability is limited to the owner’s stock value.
Company Limited by Guarantee: The shareholders must pay a predetermined amount in the event of liquidation. The precise sum that must be paid is specified in the Memorandum of Agreement.
Joint Stock company Based on Ownership
Government Company: Companies in which central, state, or local governments own at least 51% of the stock.
Non-Government Company: A private institution or individual holds majority shares in this type of company.
What Is Another Name for Joint-Stock Company
A joint-stock company is also known as a joint stock corporation or joint venture company. These terms all refer to a type of business entity that is owned by shareholders, who share in the profits and losses of the company.
The shareholders are not personally liable for the company’s debts and are only responsible for the amount of money they have invested in the company’s shares. Joint-stock companies can be either public or private, depending on whether their shares are traded on a stock exchange and whether they are required to disclose their financial information to the public.
What Are Advantages of Joint Stock
There are many advantages that a joint-stock company can offer. Here are some of the most important things to keep in mind when considering forming a joint-stock company.
Member’s Limited Liability:
Limited liability for members means that they are protected if something happens. For example, substantial business losses do not affect the personal property or property of shareholders.
Share Transferability:
Shareholders have the option to sell their shares to another investor if they wish, and there are no restrictions on doing so.
Transparency:
joint-stock companies create a high degree of transparency by making all financial statements and annual accounts available to the public.
Shareholder rights:
Shareholders have a say in the company’s decision-making process and have the right to elect the board of directors.
Capital Accumulation:
At this point, the company issues additional shares and debentures to raise more capital. The newly raised funds can be used for various business activities and expansions.
What Are the Limitations of Joint Stock Company
There are several limitations of joint stock companies:
Limited liability: While the shareholders of a joint stock company are not personally liable for the company’s debts, their liability is limited to the amount of money they have invested in the company’s shares. This means that if the company goes bankrupt, the shareholders will only lose the money they invested, but they will not be held responsible for any additional debts.
Complexity: Joint stock companies can be complex to set up and operate, as they require the creation of articles of association and the issuance of shares. They also require the appointment of directors and the holding of shareholder meetings.
Loss of control: Shareholders in a joint stock company do not have direct control over the company’s operations, as they are not involved in the day-to-day management of the business. This can be a disadvantage for shareholders who want to have a say in how the company is run.
Risk of takeover: Joint stock companies are vulnerable to takeovers by other companies or investors, as the ownership of the company is divided among a large number of shareholders. This can be a risk for shareholders who are opposed to a potential takeover.
Cost: Setting up and operating a joint stock company can be more expensive than other business structures, as it requires the issuance of shares and the appointment of directors. There may also be ongoing costs associated with holding shareholder meetings and complying with regulatory requirements.
How to check joint stock company registration?
- Log in to the official MCA website in order to access the portal.
2. Select the ‘MCA Services’ > ‘View Company/LLP Master Data’.
3. Enter the company CIN and captcha code. Click submit.
You are redirected to a page showing the following details:
- CIN/LLPIN/1A Ref No.
- Company or LLP name
- State in which the company is operating
- Registration date
- Company status
- ROC information and registration number of the company in India
- Company category, for instance, a company limited by shares or guarantee or an unlimited company
- Class of company (public or private company.)
- Authorised capital of the company and the paid-up capital of the company
- Date of incorporation
- Address and email of the company
- Listing status of the company
- Date of last annual general meeting and company status
Frequently Asked Questions (FAQs):
Who regulates joint stock company?
Joint stock companies are regulated by a variety of government agencies and organizations, depending on the country in which they are located.
How many members are required to form a joint stock company?
The Companies Act stipulates that at least two partners are required to form a joint stock company.
How many shareholders can a joint stock company have?
There are a minimum of seven shareholders is required in a joint stock company.
Conclusion
Now you got to know about registration of joint stock company is. A joint stock company is a type of business entity that is owned by shareholders, who share in the profits and losses of the company. The shareholders are not personally liable for the company’s debts and are only responsible for the amount of money they have invested in the company’s shares.