company definition & types of companies

A company is an association or collection of individuals, whether natural persons, legal persons, or a mixture of both. Company members share a common purpose and unite in order to focus their various talents and organize their collectively available skills or resources to achieve specific, declared goals. Companies take various forms such as:

• Voluntary associations which may include non-profit organization
• A group of soldiers
• Business entities with an aim of gaining a profit
• Financial entities and banks

definitions

A company can be defined as an "artificial person", invisible, intangible, created by or under law, with a discrete legal entity, perpetual succession and a common seal. It is not affected by the death, insanity or insolvency of an individual member.

Types

• A company limited by guarantee. Commonly used where companies are formed for non-commercial purposes, such as clubs or charities. The members guarantee the payment of certain (usually nominal) amounts if the company goes into insolvent liquidation, but otherwise they have no economic rights in relation to the company. This type of company is common in England. A company limited by guarantee may be with or without having share capital.
• A company limited by shares. The most common form of company used for business ventures. Specifically, a limited company is a " company in which the liability of each shareholder is limited to the amount individually invested" with corporations being "the most common example of a limited company."^[2] This type of company is common in England and many English-speaking countries. A company limited by shares may be a
  • publicly traded company or a
  • Privately held company.
• A company limited by guarantee with a share capital. A hybrid entity, usually used where the company is formed for non-commercial purposes, but the activities of the company are partly funded by investors who expect a return. This type of company may no longer be formed in the UK, although provisions still exist in law for them to exist.
• A limited-liability company. "A company—statutorily authorized in certain states—that is characterized by limited liability, management by members or managers, and limitations on ownership transfer", i.e., L.L.C. LLC structure has been called "hybrid" in that it "combines the characteristics of a corporation and of a partnership or sole proprietorship". Like a corporation it has limited liability for members of the company, and like a partnership it has "flow-through taxation to the members" and must be "dissolved upon the death or bankruptcy of a member".
• An unlimited company with or without a share capital. A hybrid entity, a company where the liability of members or shareholders for the debts (if any) of the company are not limited. In this case doctrine of veil of incorporation does not apply.
• Companies formed by letters patent. Most corporations by letters patent are corporations sole and not companies as the term is commonly understood today.
• Charter corporations. Before the passing of modern companies legislation, these were the only types of companies. Now they are relatively rare, except for very old companies that still survive (of which there are still many, particularly many British banks), or modern societies that fulfill a quasi regulatory function (for example, the Bank of England is a corporation formed by a modern charter).
• Statutory Companies. Relatively rare today, certain companies have been formed by a private statute passed in the relevant jurisdiction.
Note that "Ltd after the company's name signifies limited company, and PLC (public limited company) indicates that its shares are widely held.