Mercantile companies, in general, can be grouped into two large groups: companies of individuals and companies of capital, below an outline of this extensive topic.
Societies of people
They are characterized by taking into account the quality of the partners and by the limited patrimonial autonomy of the company. The partners have a joint responsibility with the share capital. (Soto Gamboa, p.106)
In societies of persons, the main component is the partners, due to their ethical, moral and intellectual values and their representativeness towards society, before their economic values contributed as capital. (Fierro, p.12)
If the economic purpose, that is, the satisfaction of a need with the use of specific means, is precisely to complete the capacity for work, this being the motive that induces people to associate, we are dealing with personalist societies. (Ruiz de Velasco, p.197)
They are societies of people:
- Collective society. The partnership is one in which all partners are jointly and unlimitedly liable for the operations carried out by the company. The company name is formed with the full name or surname of one or more of the partners, followed by the expressions "& Cía.", "Hnos.", "E Hijos". The number of partners must be two or more and any commercial company may be a partner. The administration of the company corresponds to each and every one of the partners, who may delegate it to third parties with the authorization of their other partners. The following may be contributed: money, credits, assets, furniture, real estate, patents and inventions, and personal industry. (Fierro, p.12) Limited partnership. In this type of company, two classes of partners are distinguished: limited partners whose responsibility is limited to their contributions, and groups that respond as in the general partnership. There are two types of limited partnership, simple and joint stock, but only the simple is part of the group of companies of people (Fierro, p.12):
- Simple. In which the contributions of the partners are not represented by shares. Their characteristics are similar to those of collective companies, only in this it is necessary to distinguish between limited partners and limited partners or groups and the economic contribution of each of them to the share capital. (Soto, p.108)
Capital companies
In which the partner is valued based on the contribution he makes to the share capital. It is usual to affirm that, in this type of company, the partner is considered for what he has. (Nieto Tamargo, p.29)
If the reason that encourages people to associate to achieve a common interest is to obtain a return on savings achieved, we are dealing with so-called capitalist societies. (Ruiz de Velasco, p.197)
In this type of society what counts is the capacity of the capital contributed by the shareholders for important projects within the economy of a country, since it is said that the shareholders do not even get to know each other. (Fierro, p.12)
Among the capital companies are:
- Limited partnership for shares. It is the limited partnership whose capital, made up of the contributions of the partners, is divided into shares and one or more shareholders are entrusted with the administration, for which they respond as collective partners. (Nieto Tamargo, p.32) Public limited company. It is a legal entity distinct from its associates, consisting of authorized capital, subscribed capital and capital paid by shareholders, whose liability is limited to the amount of their shares. (Fierro, p.12)
In addition to the two main groups above, an additional category is generally recognized:
Societies of mixed nature
In this type of society, the mixed nature relates to the two important components for society: people with all their values and principles and the amount of value contributed as wealth-generating capital. (Fierro, p.13)
When the purpose that leads people to unite to satisfy a common need, is to complete the work capacity together with obtaining the necessary capital to be able to develop said capacity, then we are dealing with mixed type societies. (Ruiz de Velasco, p.197)
The emblematic society of this nature is:
- Limited Liability Company. The partners respond up to the amount of their contributions for the operations of the company. The company name must be followed by the expressions «Ltda» or «Limitada». The administration and legal representation corresponds in its own right to each and every one of the partners, but the board of partners may delegate representation to a manager with clear and precise powers. (Fierro, p.13 and 14)
Although the aforementioned mercantile companies are the most commonly used and most widely known, it is possible that in each country there is space for other types, for example, in Colombia the Simple Corporation is known or in Argentina the Capital and Industry Society, for which is recommended to go to the local Commercial Code and / or the General Law of Mercantile Companies, as appropriate. Below links to the commercial code of some Spanish-speaking countries: Argentina, Chile, Colombia, Ecuador, Spain, Mexico, Peru, Venezuela.
Through the following video-tutorial you will be able to learn more about commercial companies, how they are classified, how they are formed and what their causes for liquidation are, among other characteristics.
References
- Fierro M., Ángel María. Heritage in commercial companies: legal and accounting applications, ECOE Ediciones, 2004Nieto Tamargo, Alfonso e Iglesias, Francisco. The information company, Editorial Ariel, 2000 Ruiz de Velasco y del Valle, Adolfo. Commercial Law Manual, Universidad Pontifica Comillas, 2007 Soto Gamboa, María de los Ángeles, Basic notions of law, EUNED, 2005
