legal entity incorporated through a legislative or registration process

A corporation is a group of persons that sit together to make and run a business. This business is considered an entirely different human and unrelated to the group that manages it. McDonald's Corporation is the world's biggest restaurant chain.

Because the government recognizes it as a company and not a person, the corporation must pay its taxes and conform to state and federal law. This difference between persons and corporations gives it special powers.[1] A corporation's special powers are determined by the law of the country in which the corporation is set up.

Investors(people who own a small part of the company) and entrepreneurs(The people who founded the company and its ideas) often form joint stock companies. Therefore, the term corporation often means such business corporations. Corporations may also be formed for local government (municipal corporation), political, religious, and charitable purposes (not-for-profit corporation), or government programs (government-owned corporation). Condominiums are a common kind of non-profit corporation.[2][3]

In common speech, the word "corporation" refers usually to limited responsibility corporation. That is a business firm where each of the partners invests a sum of money as the 'capital' of the corporation. They receive shares for the sum they have invested. If the company becomes bankrupt, the business partners are responsible for only the value of their shares of the company's debts. The partners do not use their money to pay for the debt.[source?]

References change

  1. "Types Of Corporations | Incorporate A Business". Archived from the original on 2017-10-15. Retrieved 2017-06-10.
  2. Sim, Michael (2018). "Limited Liability and the Known Unknown". Duke Law Journal. 68: 275–332. doi:10.2139/ssrn.3121519. ISSN 1556-5068. S2CID 44186028 – via SSRN.
  3. Hansmann, Henry; Kraakman, Reinier (May 1991). "Toward Unlimited Shareholder Liability for Corporate Torts". The Yale Law Journal. 100 (7): 1879. doi:10.2307/796812. ISSN 0044-0094. JSTOR 796812.

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