ZIMSEC O Level Commerce Notes: Private Business Corporation
Private Business Corporation
- found in the private sector.
- Governed by the Private Business Corporation Act of 1993.
- A cross between partnerships and limited companies.
- A legal entity or body corporate which can sue or be sued in its own name.
- Formed by a minimum of one to a maximum of twenty members.
- Prepare an incorporation statement and drafts by-laws.
- Pays a fee, to the Registrar of Companies for the registration and processing of the incorporation statement and bylaws.
- Members have limited liability.
- There is continuity even if one of the members leaves or dies.
- Its name ends with the words Private Business Corporation or the capitalised abbreviation PBC.
- Every member is an agent of the PBC.
- All members are directors and choose a chairman to run the affairs of the business.
- Every member takes part in the managing the affairs of the business.
- No remuneration is paid to members for taking part in the managing of the business.
- Any contract entered into by one member is binding on all members.
- Any disputes about the affairs of the business are settled by a majority decision.
- Each member contributes capital in the form of cash, assets or services to the PBC.
- Can be converted into a company with not more than 20 members.
- No partnership, association or body corporate or any other legal person or any person convicted of theft, forgery or fraud can be a member.
- Any member, may at any time convene a meeting by giving all members notice of the time and place and purpose of the meeting.
- The chairman of the meeting can be any member.
- The chairman does not cast any votes.
- Each member has a vote equivalent to the percentage of capital they contributed.
- Financial statements are prepared at least once annually.
- They are private.
- They are sent to the Registrar of Companies.
- Are approved and signed by one or more members whose capital aggregate is more than fifty percent.
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