Private Limited Companies

Friday, March 10, 2017


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
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