How a Limited Liability Company Differs from a Joint-Stock Company AND From an Individual Entrepreneur

To register a joint-stock company is more difficult, longer and more expensive than LLC. The main step in establishing an LLC is state registration with the tax authorities. After it, the company almost immediately can work.

When creating an AO, the registration process takes longer: it is necessary not only to register with the tax authorities, but also to register the first issue of shares.

The issue of shares will need to be registered in the regional branch of the Federal Service for Financial Markets (FFMS). The registration takes 30 days (paragraph 2.4.9 of the Standards for the issue of securities and registration of securities prospectuses approved by Order of the Federal Service for Financial Markets of Russia of January 25, 2007 No. 07-4 / pz-n (hereinafter - Standards)). A fairly large set of documents (clauses 2.4.2 and 3.2.4 of the Standards) must be submitted for registration, as well as paying a state fee of 20,000 rubles. (Para 3 of sub-clause 53 of clause 1 of Article 333.33 of the Tax Code of the Russian Federation).

For the JSC, the law sets more stringent requirements than for the LLC. In LLC, the law leaves many questions at the discretion of the participants. In fact, in the charter of the LLC you can write down your own rules.

At the same time, the management procedure in the AO is settled more clearly. It is enshrined in Federal Law No. 208-FZ of December 26, 1995 "On Joint Stock Companies" (hereinafter referred to as the JSC Law), which, incidentally, is twice as large as the Federal Law of February 8, 1998, No. 14-FZ "On Societies with Limited liability company "(hereinafter - the LLC Law).

In addition, the management procedure is detailed in separate acts of the FSFM, in particular, in the above-mentioned Standards, the Regulations on Additional Requirements for the Procedure for Preparation, Convocation and Holding of the General Meeting of Shareholders, approved by the Resolution of the FCSM of May 31, 2002 No. 17 / ps (FCSM - the predecessor of the FSFM) and other acts. The FFMS monitors compliance with established requirements and can be held liable for their violation.

Thus, working in the form of AO, you need to know the law well and follow it clearly. "Creative approach" is allowed only in exceptional cases.

The size of the minimum authorized capital in OJSC is 10 times higher than in LLC. The size of the minimum authorized capital in LLC is only 10 000 rubles. (Clause 1, Article 14 of the LLC Law), while in OAO this amount is 100,000 rubles. At the same time, in ZAO the minimum authorized capital, as well as in LLC, is 10,000 rubles. (Article 26 of the JSC Law).

If in LLC to pay the authorized capital by property, then it is necessary to involve an appraiser only when the value of the property is more than 20 000 rubles. (Clause 2 of article 15 of the Law on LLC). The property of a lower value can be assessed at the general meeting of participants.

In AO, the appraiser must be engaged regardless of the amount of property contributed to the authorized capital (clause 3 of article 34 of the JSC Law, clause 3.2.7 of the Standards).

In LLC, the number of participants should not exceed 50 (paragraph 3 of Article 7 of the Law on LLC), and in OAO the number of shareholders is unlimited (paragraph 2 of Article 7 of the JSC Law). In ZAO, the number of shareholders can not exceed 50 (paragraph 3 of Article 7 of the JSC Law).

To buy (sell) a stake in LLC is more difficult than shares in AO. Almost all transactions for the alienation of a share in an LLC must be notarized, and after that it is still necessary to make changes to the Unified State Register of Legal Entities.

In AO, a change in the ownership of shares is much easier. When transferring shares to the acquirer, it is sufficient to make changes in the register of shareholders, having preliminarily issued a transfer order. The register of shareholders is maintained by the company itself or the registrar (clause 3 of article 44 of the JSC Law). At the same time, it is not necessary to notarize a transaction, it is not necessary to make changes to the Unified State Register of Legal Entities.

When selling shares, JSC does not need to comply even with a preferential right (clause 2, clause 7 of the JSC Law).

After the mandatory notarization of deals with shares in LLC was introduced, the transparency of share movement improved, the number of "drawn" backdated contracts of purchase and sale of shares, which were the main cause of corporate conflicts, decreased.

In turn, the bulk of corporate disputes over shares rights is caused by the fact that many joint-stock companies, when they keep the register of shareholders independently, are not guided by law and do not pay attention to violation of the rights of shareholders.

In LLC, information about participants is more open than information about shareholders in JSC. The USRLE contains full information about the members of the LLC, an extract from it can be obtained by anyone.

In the AO, information on shareholders is only in the register of shareholders, which is maintained by the company itself or by the registrar. An unauthorized person is much more difficult to obtain such information than an extract from the Unified State Register of Legal Entities.

LLC can be made closed for third parties to participate in it, and it is impossible to do so in JSC. In LLC it is possible to completely exclude the possibility of the entry of third parties into the membership of the company. For this it is only necessary to introduce the relevant provisions in the charter. LLC can be completely closed even from successors (in particular, from heirs) of the participants.

In AO, you can not do this. The Charter of the Company can not provide for a ban on the alienation of shares to third parties. The only limitation is the preferential right of other shareholders. This is confirmed by judicial practice (FAS resolution of the West Siberian District of March 19, 2009 in case No. A70-4288 / 2008).

At the same time, the JSC does not even have a preemptive right, that is, the change of shareholders can occur freely.

In AO there are more opportunities to make decisions, beneficial only parts of the owners. When counting votes at a general meeting of shareholders, not from all the votes of shareholders (holding voting shares), but only from those who take part in the meeting (paragraph 2 of article 49 of the JSC Law).

In the LLC (at the general meeting of participants), the votes are counted on the basis of the total number of votes of all company participants (clause 8 of Article 37 of the LLC Law).

Thus, in order to take a decision in JSC, it is not always necessary to have a majority of votes among all the votes of the shareholders. It is enough to have the majority among those who are present.

In addition, if there is no quorum at the shareholders meeting, then a repeat meeting can be held, at which there is enough 30 percent of the votes of the placed voting shares, and not 50. If the quorum is absent at the annual meeting, then it is necessary to hold a re-meeting (Section 3, Art. 58 of the JSC Law).

Due to such rules, the JSC has more opportunity to take a decision by a narrow group of shareholders.

AO is more solid. It is generally accepted that the organizational and legal form of a "joint-stock company" is in some way a sign of quality. The company, created in the form of joint-stock companies, is usually perceived as large and more stable in the market.

This is due, inter alia, to the fact that the law sets the law tougher requirements. And also with the fact that large companies usually work in the form of joint-stock companies. Many existing JSCs are privatized state-owned enterprises, which traditionally have higher confidence than private companies.

In the form of an LLC, usually medium and small businesses operate. However, among them there are also known names.

How does a Limited Liability Company differ from an individual entrepreneur

The main difference is the size of responsibility. The members of the LLC do not answer for the obligations of the LLC and bear the risk of losses only within the limits of their share (Clause 1, Article 2 of the LLC Law).

A natural person registered as an individual entrepreneur is responsible for his obligations (including those assumed as an individual entrepreneur) with all his property (Article 23-25 of the Civil Code of the Russian Federation).

To register an LLC is a little more expensive and more difficult than to become an individual entrepreneur. To register an LLC, you need to issue more documents than to register an individual entrepreneur.

In addition, when registering an LLC, you must pay a state fee of $ 4,000. (Subsection 1 of clause 1 of Article 333.33 of the Tax Code), for an individual entrepreneur the amount of the state duty is 800 rubles. (Subclause 6 of clause 1 of Article 333.33 of the Tax Code of the Russian Federation).

An individual entrepreneur must be registered at the place of residence, and LLC - at the legal address. In the Unified State Register of Legal Entities, the address of the place of residence of the individual entrepreneur is indicated (sub-item "d" of item 2 of Article 5 of the Federal Law of 8 August 2001 No. 129-FZ "On State Registration of Legal Entities and Individual Entrepreneurs"), Is provided.

In turn, the legal address of the LLC may be in any federation subject, regardless of where the participant or director is registered ("registered").

An individual entrepreneur is not entitled to conduct certain types of activities that are permitted for the Limited Liability Company . In particular, an individual entrepreneur is not entitled to engage in retail sales of alcoholic beverages (paragraph 1 of Article 16 of the Federal Law of November 22, 1995 No. 171-FZ "On state regulation of production and turnover of ethyl alcohol, alcohol and alcohol-containing products and on consumption restriction Drinking) of alcohol products ").

The LLC may include up to 50 participants (clause 3 of Article 7 of the Law on LLC), and an individual entrepreneur works alone. He has the right only to hire employees. To unite with his partners, he needs to create a legal entity or enter into a simple partnership agreement , or choose some other form of cooperation.

Penalties for legal entities are much greater than for individual entrepreneurs. So, for the commission of administrative offenses, individual entrepreneurs are not liable as legal entities, but as officials, unless special sanctions are established for them in the article (Article 2.4 of the Code of Administrative Offenses of the Russian Federation).

For example, for the sale of goods without a certificate of conformity certifying the safety of such goods for life and health of people (clause 2, Article 14.4 of the Code of Administrative Offenses of the Russian Federation), legal entities are liable in the form of a fine in the amount of 40,000 to 50,000 rubles, The amount of the fine is from 4000 to 5000 rubles. (Other sanctions are provided for this violation).

A stake in LLC can be sold. A business built as an individual entrepreneur can not be sold that way. It will be necessary either to create an LLC, reissue everything on it and then sell a 100 percent stake, or sell only the property.

LLC is more solid. It is generally accepted that individual entrepreneurs are small businesses that "survive" by any means and sometimes are not in a position to be responsible for their activities. For this reason, some companies refuse to work with individual entrepreneurs.

In the form of an LLC, usually medium and small businesses operate, and among them there are well-known companies.

Ltd. difficult and long to eliminate. The liquidation of the LLC takes several months. At the same time, the termination of activity as an individual entrepreneur usually takes less than one month.