Public Joint-stock Company:
A joint-stock company is a legal association therefore must be registered and the promoters must submit the following documents:
(i) Memorandum of Association which must contain:
Name of the company, with limited attached meaning it is a company with shareholders having limited liabilities, Address of the registered office,
The capital, Objective(s) of the company, and duly signed by two persons if private company and seven if it is a public company.
(ii) Article of Association of the company containing the following:
- The internal constitution of the company,
- How shares are to be issued or transferred,
- Right of the various shareholders,
- The powers of the officers and
- How they will be elected.
It possesses a large capital raised from the sale of shares to the public. These shares are freely transferable to other members of the public. Liabilities of members are limited to the capital they contribute. Profits are shared out to members according to the contributions made. These are called "dividends". The public joint-stock company also employs paid board of directors who run the business. Shareholders therefore need not be involved in the administration of the company.