Equity is the right of shareholders, which can be divided into broad sense and narrow sense. Equity in a broad sense refers to all kinds of rights that shareholders can claim from the company. In a narrow sense, equity only refers to the right of shareholders to obtain economic benefits from the company and participate in the company's operation and management based on shareholder qualification.
What's the difference between company equity and shares?
1, with different definitions:
Shares represent a part of the company's ownership, which is divided into common shares, preferred shares and incomplete shares. Shares represent the rights and obligations of shareholders of a joint stock limited company, and equity is the right of shareholders to obtain economic benefits from the company based on their qualifications and participate in the company's operation and management. Equity is the share of shareholders' investment in start-up companies and the basis of shareholders' dividend ratio.
2, the same is to bear the responsibility, both of which are limited to the amount of capital contribution and shares.
Article 3 of the Company Law stipulates: "The shareholders of a limited liability company shall be liable to the company to the extent of their subscribed capital contribution; Shareholders of a joint stock limited company are liable to the company to the extent of their subscribed shares. In Chapter IV "Establishment and Organization of a joint stock limited company" and Chapter V of the Company Law, there is no "equity", that is, there is no "equity" in a joint stock limited company.
3. Equity and share transfer are different.
Article 125 of the Company Law stipulates: "The capital of a joint stock limited company is divided into shares, and the amount of each share is equal." The capital contribution of a limited liability company is not divided equally. Article 71 of the Company Law stipulates that shareholders of a limited liability company may transfer all or part of their shares to each other.
The transfer of shares by a shareholder to a person other than the shareholder shall be approved by more than half of the other shareholders. Unlike share transfer, share transfer does not require the consent of the shareholders' meeting. The transfer of shares must be approved by other shareholders and the corresponding procedures must be fulfilled.
In this regard, Article 71 of the Company Law stipulates: "When a shareholder transfers his equity, it shall notify other shareholders in writing. If other shareholders fail to reply within 30 days from the date of receiving the written notice, it shall be deemed as agreeing to the transfer." In practice, there are also limited liability companies that discuss the transfer of shareholders' equity at the shareholders' meeting.