What's the difference between a company limited by shares and a limited company?

Firstly, the differences between the two companies are summarized. There are significant differences between limited liability companies and joint stock limited companies in terms of scale, establishment methods and management requirements, which are suitable for investors with different needs. When choosing the company form, we should consider the property ability, business ability and long-term demand of the sponsors. Generally speaking, limited liability company, as a small company with high privacy, protects the trust relationship between shareholders and is the combination of human nature and capital cooperation. The company has flexible operation and simple establishment and operation steps. Limited by Share Ltd is a typical joint venture company with large scale and strong publicity. It often has a large number of shareholders by issuing shares, and the company's decision-making also has the right to speak according to the number of shares held. For the purpose of protecting the public, the establishment of a joint stock limited company is more strict and complicated than the establishment of a limited liability company, no matter from the establishment conditions or procedures. Second, the specific differences between the two corporate forms 1. Differences in equity forms: In a limited liability company, the total share capital is not equally divided, and shareholders' rights and interests are expressed by the proportion of their subscribed capital contributions. When voting and paying off debts, shareholders shall enjoy rights and bear responsibilities according to the proportion of their subscribed capital contributions; The total capital of a joint-stock company is divided into shares with smaller amount per share and shares with equal amount. The voting rights of shareholders are calculated according to the subscribed capital contribution, with one vote per share. 2. The difference between the way of establishment and the process: A limited liability company can only raise funds by the promoters, and cannot publicly raise funds, issue shares or go public. The establishment process is as follows: signing articles of association-capital contribution by shareholders-capital verification by capital verification institutions-establishment registration; A joint stock limited company can not only set up a limited liability company, but also raise funds from the public and go public for financing. However, the establishment process is complicated: formulating the company's articles of association-the promoters subscribe for shares and publicly issue shares to the public-capital verification-convening the founding meeting-establishment registration. 3. Limit on the number of shareholders: A limited liability company shall have no more than 50 shareholders, thus protecting the company's closeness; A joint stock limited company shall have 2-200 promoters, and the number of shareholders is not limited. The shareholders of a listed company with millions of people are all shareholders of the company. 4. Company capital scale: Except for limited liability companies and joint-stock companies, the minimum registered capital of limited companies in other regions in Shanghai Free Trade Zone is 30,000 yuan, that of joint-stock companies is 5 million yuan, and that of listed companies is 50 million yuan. At present, the State Council has held a meeting to urge the whole country to promote the abolition of the minimum registered capital system. It seems that all localities have not yet implemented the detailed rules. 5. The degree of standardization of organizational structure is different: Limited companies are relatively simple and flexible, and the organizational structure can be stipulated in the articles of association, with only one director and one supervisor, but no board of supervisors and board of directors; Limited by Share Ltd has high requirements, so it is necessary to set up a board of directors and a board of supervisors and hold regular shareholders' meetings. On the basis of joint stock limited companies, listed companies should also invite external independent directors. 6. Equity transfer and liquidity: In a limited liability company, shareholders can transfer their capital contributions to each other. When transferring capital contribution to people other than shareholders, it must be approved by more than half of the shareholders' meeting, so the liquidity of equity is poor and weak; The shares of a joint stock limited company are publicly issued and the transfer is unrestricted, while the shares of listed companies are more liquid and have stronger financing ability. 7. Public disclosure: the production, operation and financial status of a limited liability company only need to be disclosed to shareholders for inspection within the time limit stipulated in the company's articles of association, and the financial status is relatively confidential; Limited by shares, and regularly publish its financial status, listed companies should announce their financial status to the public through public media, which is difficult to operate, difficult to keep secret of the company's financial status, and more likely to involve information disclosure, insider trading and other issues. After knowing the difference between a joint stock limited company and a limited company, you can combine your own conditions and needs and set up a company according to various specifications of a joint stock limited company and a limited company. It should be noted that limited liability companies are relatively small in all aspects, and joint stock limited companies are relatively large, which can be listed and can be used for stock financing.