A joint-stock company is a business entity which is owned by shareholders. Each shareholder owns the portion of the company in proportion to his or her ownership of the company's shares (certificates of ownership). This allows for the unequal ownership of a business with some shareholders owning a larger proportion of a company than others. Shareholders are able to transfer their shares to others without any effects to the continued existence of the company.
In modern corporate law, the existence of a joint-stock company is often synonymous with incorporation (i.e. possession of legal personality separate from shareholders) and limited liability (meaning that the shareholders are only liable for the company's debts to the value of the money they invested in the company). And as a consequence joint-stock companies are commonly known as corporations or limited companies.
Some jurisdictions still provide the possibility of registering joint-stock companies without limited liability. In the United Kingdom and other countries which have adopted their model of company law, these are known as unlimited companies. In the United States, they are, somewhat confusingly, known as joint-stock companies.
Read more about Joint-stock Company: Advantages, Early Joint-stock Companies
Famous quotes containing the word company:
“The Bermudas are said to have been discovered by a Spanish ship of that name which was wrecked on them.... Yet at the very first planting of them with some sixty persons, in 1612, the first governor, the same year, “built and laid the foundation of eight or nine forts.” To be ready, one would say, to entertain the first ship’s company that should be next shipwrecked on to them.”
—Henry David Thoreau (1817–1862)