Characteristics Of Joint Stock Company

The main characteristics of joint stock company are as follows:

1. Legal personality
A company has its own legal personality. It is created by law and has separate legal existence from its owners. It is not liable for the acts of its shareholders. The shareholders are not liable for the acts of the company.

2. Artificial person
A company is an artificial person. It exists in the eyes of law. It can own, buy and sell property in its own name. it can enter into contract. It can file cases in the courts of law. It can be sued by others.

                               Also Read: Concept And Meaning Of Joint Stock Company

3. Continued existence
A company has continued existence. It is created by law. It can be liquidated only by law.

4. Limited liability
The shareholders of a company have limited liability. It is limited to the face value of shares. The shareholders are not personally liable for the debts of company.

                          
5. Share transferable
The capital of a company is divided into shares. The shares of a public company are freely transferable. The share transfer is done through stock exchange. The shareholder can sell his shares at his own will.

6. Separation of ownership and management
A company has separation of ownership and management. The shareholders are the owners. They elect a board of directors to manage the company. The management is democratic and representative. Shareholders have no right to participate in day to day management of a company.

                          Also Read: Disadvantages Of Joint Stock company

7. Common seal
A company has a common seal. It represents the official signature of the company. It i put on all important documents. It indicates approval by the company. The name of the company is engraved on the common seal.


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