Last edited 01 Nov 2019

Company

A company is a legally-recognised group or association of people who have a common goal and who use their respective talents to achieve that goal. In the UK, companies must be registered under the Companies Acts (or other similar legislation).

Companies can take various forms, including:

In the UK, when a company’s name is followed by the letters ‘Ltd’, it denotes that the company is a private limited company. In other words, in the event of the company being liable say, for a misdemeanour or economic misadventure, the shareholders or subscribers of that company are liable only for the amount of their investment or what they have guaranteed to the company, ie, they have limited liability. For example, if an investor owns £10,000 worth of shares and the company becomes bankrupt (or ‘goes bust’), the investor is only liable for the value of the shares even if the company’s debts run into millions.

If a limited company is guaranteed by shares (as opposed to limited by guarantee), it may be a private or public company. A private company limited by shares is denoted by Ltd; a public company limited by shares is denoted by PLC (or Plc) after its name. In a Plc, the shares are available to be purchased by the public.

Companies may also be classified according to whether they are public (ie owned by the state) or private.

Suffixes used in various countries to denote whether a company is public or private:

Country Public limited company Private limited company
UK PLC Ltd
France S.A s.a.r.l
Germany AG GmbH
Italy S.p.A s.r.l
Spain S.A s.r.l
Czech Rep a.s s.r.o
Greece S.A (AE in Greek) EPE
Hungary Zrt kft
Romania S.A s.r.l

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