By definition, it is visible that any limited company presents a limited liability to its owners and the management. It is beneficial since it is a Public Compy as it permits a firm to sell shares to investors which further helps to generate capital. There are many other benefits attached to Public Company registration and they are as follows;
This is similar to the Limited Liability companies in which the company is a legal object and a juristic person authorized under the Act. Hence, a company form of organization enjoys legal capacity and can own property and also acquire debts. They are kept separate from the members (Shareholders/Directors) of a company & they have no liability towards the creditors of a company for such debts.
Until the Company is legally dissolved it has a 'perpetual succession' which means uninterrupted existence. Since a Public Company is a separate legal entity it is not affected by the death or retirement/removal of the members involved with the Organization.
A Public Company has much more avenues to borrow funds from the banks. Another important benefit is that it can issue debentures who can be secured or unsecured. Being a public Company it has the right to accept funds from Public, etc. The banks and other financial institutes prefer to invest a huge sum of money to the public Company instead of spending on Partnership or Proprietary firms.
The Public Company is given the right to transfer shares of a company wherein the shareholder can transfer the share to any other person. It is a simple process in which a filing and signing a share transfer form is required and then the share can be handed over to the buyer of the shares once he gets the share certificate.
Since the company is a distinct legal entity and a juristic person, it has the right to acquire, own, and divide, property in its own name. A Shareholder or any person involved in the company cannot claim upon the property of the company as long as the Company is running.
Like Private Limited and LLP , the Public Company also has Limited Liability which means the shareholders and members are legally responsible only to a limited amount of debts in the company.
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