Private Limited Companies

Features

v  Must use the word “Limited” or “Ltd” after its name

v  Can not invite the general public to buy its shares and debentures

v  Must have a minimum of two shareholders

v  Can have one or more directors

v  Can not transfer its shares freely

v  Need not to have trading certificate

Advantages

v  Shareholders have limited liability

v  There is no limit on the maximum number of shareholders

v  Death of a shareholder does not effect the life of the company

v  Need not to get trading certificate to commence business

v  It can have a minimum of one director

Disadvantages

v  It can not invite the general public to buy its shares and debentures

v  Shares can not be transferred freely

v  Relatively lower capital