12 differences between a limited company and a joint stock company

Limited or joint stock company

When choosing the most suitable capital company types for you, it will help you to know the common aspects and differences of limited and joint stock companies. These two types of companies differ from each other in terms of the responsibilities of their partners, capital, company organs and share transfer transactions.

Since a limited liability company also has some characteristics of sole proprietorships, it is a little more flexible than the capital partnership structure of a joint stock company.

What is a limited company?

The partners are not responsible for the debts of the company for their own assets, can be established by real and legal persons with one or more shareholders, can operate in all economic purposes and issues not prohibited by the law, at least one partner has the right to manage and represent the company, and the number of partners is 50. The company type that does not exceed The trading volume of the limited company is high.

What is a joint stock company?

It is a company type, joint stock company that can be established by real and legal persons with one or more shareholders, can operate in all economic purposes and issues not prohibited by law, and the number of partners can be unlimited. The commercial volume of the joint stock company is also high. It is also open to the interest of investors as share transfer can be done easily.

Common features of limited and joint stock companies

• It can be established by both real and legal persons, with one or more shareholders.
• Its founders, T.C. It does not have to be a citizen or resident.
• Both types of companies can be established in any field of activity for any economic purpose and subject that is not prohibited by law. (Companies that will operate in some areas such as financial leasing, banking, insurance may need to be established as joint stock companies.)
• In both types of companies, the names of the partners do not have to appear in the company name.
• Both types of companies can have a single shareholder.
• Company partners are not liable for company debts. The only responsibility of the partners towards the company is to pay the capital share they have committed, and in limited companies, the partners must fulfill the obligations regarding other additional payments if specified in the articles of association. At the same time, the partners of the limited company are responsible for the public debts of the company with their own assets in proportion to the capital share they have committed. (For example, a partner who has invested 25,000 TL in a company with 100,000 capital is personally liable with his own assets for 2,500 TL of the company's public debt of 10.00 TL.)

12 differences between limited and joint stock companies

1. While the minimum capital required for the establishment of a limited company is 10,000 TL, the minimum capital required for a joint stock company is 50,000 TL.
2. Companies that will operate in areas such as financial leasing, banking and insurance should be established as joint stock companies.
3. A limited company can have a maximum of 50 partners. In a joint stock company, there is no limit in terms of the number of partners. (If the number of partners in joint stock companies exceeds 250, the company will be subject to the Capital Market Law.)
4. In principle, in both types of companies, the partners of the company are not responsible for the debts of the company, but in limited companies, the partners of the company are responsible for the public debts of the company with their own assets in proportion to the capital they have committed. In joint stock companies, partners are not liable for public debts.
5. In limited companies, at least one partner must have the right to manage and represent the company, while this does not apply to joint stock company partners. It is sufficient only for a member of the board of directors to have full representation authority from among the partners or not.
6. Limited company shares are linked to the name shares. Shares in joint stock companies can also be linked to bearer shares.
7. While the written share transfer agreement must be approved by a notary for the transfer of shares in limited companies, notary approval is not required for the transfer of shares in joint stock companies.
8. While share transfer may be prohibited in limited companies, share transfer cannot be prohibited in joint stock companies, but it may be limited in some cases, provided that it is stipulated in the articles of association, or in the cases stipulated in the Turkish Commercial Code.
9. While a maximum of fifteen voting rights can be granted to one share in joint stock companies, there is no such limitation in limited companies. In the articles of association, the shareholders may be given the right of veto.
10. The decision quorum of joint stock companies is generally lower than limited companies.
11. Joint stock companies can be established for an unlimited period of time, while limited liability companies can be established for a maximum of 99 years.
12. No matter how many years later the shares of the limited company are sold, the income obtained is subject to income tax; The shares of the joint stock company are subject to income tax only if they are sold within two years. If it is sold after two years, such a thing is out of the question.