What are the limited liability companies?

A limited liability company, referred to as a limited liability company for short, refers to an economic organization registered in accordance with the Regulations of the People's Republic of China on the Administration of Company Registration and established by shareholders with less than 50 employees. Each shareholder shall bear limited liability to the company to the extent of the subscribed capital contribution, and the company shall bear full responsibility for the company's debts with all its assets. Limited liability companies include wholly state-owned companies and other limited liability companies. [ 1]? [3]?

There are two forms of statutory companies in China: limited liability companies (joint stock companies) and joint stock companies (

Limited company is the most important organizational form for Chinese enterprises to implement corporate system, which refers to registration according to the Regulations of the People's Republic of China on the Administration of Company Registration. Its advantage is that the establishment procedure is relatively simple, and there is no need to issue an announcement or account number. In particular, the company's balance sheet is generally not open, and the company's internal institutions are flexible. Its disadvantage is that it is impossible to issue shares publicly, and the scope and scale of funds raised are generally small, which is difficult to meet the needs of large-scale production and operation activities. Therefore, the form of limited liability company (limited company) is generally suitable for small and medium-sized non-joint-stock companies.

For entrepreneurship, limited liability companies are more suitable for entrepreneurship, and most investment and financing schemes and VIE structures are designed based on limited liability companies.

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