The concept of a legal entity

In the market, as in life in general, people enter into various kinds of relations with each other. They enter into these relations directly, that is, as separate individuals, and indirectly, through various kinds of groups, associations of individuals. In the latter case, such a group or association acts as a single entity that has some common interests, tasks, goals. In turn, these groups can again unite into new groups, etc.

Associations of people may be formalized or non-formalized. In the first case, such associations receive the status of a legal entity or other status permitted by law, for example, the status of a branch, representative office of a legal entity. In the second case, they exist without any legal formalization.

In accordance with Article 48 of the Russian Federation " legal entity an organization is recognized that owns, manages or operates a separate entity and is liable for its obligations with this property, can acquire and exercise property and personal non-property rights on its own behalf, incur obligations, be a plaintiff and defendant in court.

Main features of a legal entity

An organization that exists in the form of a legal entity has the following features:

• separate property on the right of ownership or on the right of economic management, or on the right of operational management, taken into account in an independent balance sheet;
• the existence of a legal entity's property liability separated from the property of the founders (owners) of its property with all the property it has on its balance sheet; the former are not liable for the obligations of the legal entity formed by them (except when it is provided for by law), and it, in turn, is not liable for the obligations of its founders (owners);
• independent participation in civil law relations on its own behalf, and not on behalf of its founders (owners), including the acquisition and implementation of property and personal non-property rights and the performance of obligations permitted by applicable law;
• the right to protect one's interests in a legal way, i.e. to act as a plaintiff and a defendant in court;
• availability of a certificate of state registration as a legal entity.

Classifications of legal entities

In accordance with the Civil Code of the Russian Federation, legal entities permitted by law are classified according to:

• goals of the activity (making a profit or achieving any other goals not prohibited by law, except for making a profit);
• organizational and legal form, i.e., by permitted types of organizations;
• the nature of the relationship between the legal entity and its founders in terms of whether or not the founders have ownership rights to their contributions to the property of this legal entity.

Purpose of activity

According to the purpose of activity, legal entities are divided into two big classes: commercial and non-profit organizations.

Non-profit organizations can be created in the following forms: consumer cooperatives; public and religious associations; owner-funded institutions; charitable foundations and in other legally permitted forms.

The nature of the relationship

By the nature of the relationship between a legal entity and its founders, two types of organizations.

First type of organization is that the founders retain ownership of their contributions made to the legal entity they organize, and the latter does not have ownership rights to these contributions.

Second type of organizations is that the founders lose the ownership of their contributions to the legal entity and this right passes to the legal entity. This type of organization can have two subgroups:

• the first subgroup - organizations in which the founder, in return for his contribution, receives certain rights of obligation in relation to the legal entity;
• the second subgroup - organizations in which the founder does not receive in return for his contribution any rights in relation to the legal entity he establishes.

The first type of legal entities includes state and municipal unitary enterprises and institutions financed by their owner.

The second type includes all other legal entities.

The first subgroup of the second type of legal entities includes business partnerships, business companies, production and consumer cooperatives.

The second subgroup of the second type of legal entities includes public organizations (associations), religious organizations, charitable and other foundations, associations and unions that unite legal entities, and other non-profit organizations.

Legal regime of property

Depending on the legal regime of property, legal entities are divided into:

• subjects of ownership(business partnerships and societies, cooperatives and all non-profit organizations, except institutions);
• subjects of the right of economic management(state and municipal unitary enterprises, subsidiaries);
• subjects of the right of operational management(federal state enterprises, institutions).

In world practice, in the legislation of other countries there are other types of legal entities, which reflects, on the one hand, a long history of the development of a market economy, and on the other hand, the national characteristics of each country. From this point of view, in the future, other types of legal entities may appear in Russia, if this becomes necessary for the participants of the Russian market.

The general classification of legal entities under Russian law is shown in fig. 2.

Classification of legal entities

There are several classifications of legal entities.

First of all, all legal entities can be divided into commercial and non-commercial organizations. This classification is based on the purpose of the creation and functioning of the legal.ischa.

Commercial organizations the main purpose is to make a profit and can distribute the profit received among their participants (founders).

Non-Profit Organizations do not have such a main goal and cannot distribute profits among their founders (participants).

Rice. Legal entities in Russia

The absence of the goal of making a profit does not prevent non-profit organizations from engaging in entrepreneurial activities, if such an opportunity is provided for by the constituent documents and does not interfere with the statutory goals and objectives.

The second criterion for classification is legal form, which is understood as the structural structure of a legal entity established by law, which determines the procedure for its establishment, the rights and obligations of the founders (participants), the procedure for management and functioning.

The list of organizational and legal forms of commercial organizations is established by the Civil Code of the Russian Federation and is exhaustive. Commercial organizations can be created in the form of: business partnerships (general partnership and limited partnership); economic companies (limited liability companies, additional liability companies, open joint stock company, closed joint stock company); production cooperatives; unitary enterprises (state and municipal).

The organizational and legal forms of non-profit organizations in accordance with the Civil Code of the Russian Federation are the following: public organization; religious organization; institution; fund; consumer cooperative; association (union). Civil law also allows the creation of a non-profit partnership, a state corporation, a state company, an autonomous non-profit organization, a homeowners association, a chamber of commerce and industry, etc.

In addition to the Civil Code of the Russian Federation, the organizational and legal forms of non-profit organizations may be established by other federal laws.

Features of individual organizational and legal forms of legal entities are established by special laws.

An important criterion for classification is the nature of the rights of participants in relation to the legal entity. According to this criterion, three groups of legal entities can be distinguished.

The first group includes legal entities in respect of which the founders (participants) have rights in rem— institutions and unitary enterprises. Such legal entities do not have the right of ownership to the property assigned to them by the founder, but only the right of economic management or the right of operational management.

The second group includes legal entities in respect of which the founders (participants) have liability rights, - business partnerships, business companies, production and consumer cooperatives. Liability rights imply the right to profit from activities and to receive part of the property in the event of liquidation of a legal entity.

The third group includes non-profit organizations in respect of which the founders do not have property rights.

There are other classifications of legal entities.

All other classifications, as well as the status of individual organizational and legal forms, will not be considered within the framework of this work.

Organizational and legal form

An economic entity is a form of an economic entity recognized by the legislation of a particular country, fixing the method of fixing and using property by an economic entity and its legal status and goals of activity arising from this.

Organizational and legal form- a way of fixing and using property by an economic entity and its legal status and business goals arising from this.

In the all-Russian classifier of organizational and legal forms (OKOPF) (OK 028-99 (as amended by amendment No. 1/99)) each legal form corresponds to a two-digit digital code, the name of the legal form, and the collection algorithm.

Classification of organizational and legal forms in the Russian Federation

There are the following types of organizational and legal forms of economic entities (hereinafter also OPF):

OPF of economic entities that are legal entities-commercial organizations

• Partnerships
• Society
• Joint stock companies
• Unitary enterprises
  • Unitary enterprises based on the right of economic management
  • Unitary enterprises based on the right of operational management
• Other

OPF of economic entities that are legal entities-non-profit organizations

• Public associations (including religious associations)
  • Bodies of public initiative
• Foundations (including public foundations)
• Institutions (including public institutions)
• Communities of Indigenous Peoples
• Associations of legal entities (associations and unions)
• Associations of peasant (farm) households
• Horticultural, horticultural or dacha non-profit partnerships

OPF of economic entities without the rights of a legal entity

• Ordinary partnerships

BTF examples

state and municipal institutions

The simplest name for the OPF of state institutions is FGU (federal) and GU (regional, Moscow and St. Petersburg). Sometimes the word “budgetary” is added to the OPF, for example, in the OPF forestry, correctional colonies. The name of the OPF may include the word "regional" and even the name of the subject of the Russian Federation: "Novosibirsk region", "city of Moscow", but not necessarily.

OPF of state institutions:

• federal government agency
• Regional State Institution (State Regional Institution), OSU
• government agency
• Federal state budgetary institution

Federal State Budgetary Institution of Science

• Regional state budgetary institution
• State budgetary institution of the Novosibirsk region
• State budgetary institution of the city of Moscow
• State budget institution
• State (municipal) public institution

Educational, healthcare and cultural institutions have their own OPF names:

OPF of educational institutions:

• Federal State Autonomous Educational Institution of Higher Professional Education
• State educational institution of higher professional education
• State educational institution of secondary vocational education
• State educational institution
• Municipal budgetary educational institution
• Municipal preschool educational institution

OPF of military educational institutions:

• Federal State Military Educational Institution of Higher Professional Education
• State military educational institution of higher professional education

OPF of health care institutions:

• Federal Public Health Institution
• Public Health Institution
• Municipal Health Institution

OPF of cultural institutions:

• Federal State Institution of Culture
• State Budgetary Institution of Culture of the Sverdlovsk Region
• State institution of culture of the city of Moscow

Unusual OPFs:

• Regional state educational institution for orphans and children left without parental care
• State Special Rehabilitation Educational Institution of Secondary Vocational Education - College for the Disabled
• Federal State Educational Institution of Secondary (Complete) General Education "Astrakhan Suvorov Military School of the Ministry of Internal Affairs of the Russian Federation"- does not have an indication of "military".

state and municipal unitary enterprises

OPF of unitary enterprises:

• Federal State Unitary Enterprise
• State Regional Unitary Enterprise
• State unitary enterprise
• Municipal unitary enterprise

see also

• Types of companies

Sources

• Chapter 4
• Federal Law No. 82-FZ of May 19, 1995 "On public associations"
• Decree of the State Standard of the Russian Federation of March 30, 1999 N 97(as amended on 06/09/2001) "On the adoption and implementation of all-Russian classifiers" (together with the "all-Russian classifier of forms of ownership" OK 027-99)

Links

• The choice of the organizational and legal form of the enterprise - an article by Doctor of Economics, Professor Adukov

Wikimedia Foundation. 2010 .

• Las Casas, Bartolome de
• Victor Emmanuel II

See what "Organizational and legal form" is in other dictionaries:

Organizational and legal form- The legal form in which the registration and activities of a legal entity are carried out. Examples of organizational and legal forms are an open joint stock company, a closed joint stock company, a limited partnership, a limited company ...

FORM OF OWNERSHIP ORGANIZATIONAL AND LEGAL- Organizational form of ownership of the means of production, enshrined in national legislation Glossary of business terms. Akademik.ru. 2001 ... Glossary of business terms

Legal form of activity- organizational and managerial form of activities of authorized entities. Its legal essence is that it is based on the prescriptions of law and always entails the onset of certain legal consequences. Unlike actual... Theory of state and law in schemes and definitions

FORM OF OWNERSHIP, ORGANIZATIONAL AND LEGAL- organizational form of ownership of the means of production enshrined in national legislation ... Big Economic Dictionary

Legal system- This article or section needs to be revised. Please improve the article in accordance with the rules for writing articles ... Wikipedia

Joint stock companies- The organizational and legal form of an enterprise that, for its obligations to creditors, is liable only for the property that belongs to it. Shareholders do not bear any responsibility to creditors, they only risk ... Terminological dictionary of a librarian on socio-economic topics

General partnership- Organizational legal form of a commercial organization. A partnership is recognized as full, the participants of which (general partners), in accordance with the agreement concluded between them, are engaged in entrepreneurial activities on behalf of the partnership and ... ... Vocabulary: accounting, taxes, business law

MEETING OF THE FEDERATION COUNCIL- organizational and legal form of consideration by the upper chamber of the Federal Assembly of issues referred by the Constitution of the Russian Federation to its jurisdiction. The regulations of the Federation Council provide that the chamber holds meetings from September 16 of the current to 15 ... ... Encyclopedic Dictionary "Constitutional Law of Russia"

Citizens in pursuit of the set goal unite in communities and organizations that make it possible for them to rationally use their savings. To implement the planned, it is necessary to organize a legal entity, which, depending on the task, can be of a commercial or non-commercial type.

At the same time, the nature of the legal relationship between the enterprise and the owners can be formed in such a way that the founders lose their rights to their deposits, as they are transferred to the enterprise or they retain the property right to deposits, and the enterprise is not entitled to count on them.

This classification is necessary in order to determine the direction of the business formation.

For example, commercial structures pursue one goal - obtaining material benefits, while non-commercial structures do not have the right to prioritize the receipt of income and distribute it among the participants of the companies.

According to such a classification, the legislator regulates the features of the activity and formation of a particular legal entity.

What form of ownership to choose for LLC and IP - see here:

The legislative framework

All possible legal forms are indicated in the all-Russian classifier adopted and put into effect by Order of the Federal Agency No. 505 of 2012.

In addition, the definition of this concept is given in Art. 48 of the Civil Code of the Russian Federation. Specific economic forms of legal entities are indicated by:

• Art. 69, 82 of the Civil Code of the Russian Federation - definition of the concept of full and faith-based partnerships;
• Art. 87, 96 of the Civil Code of the Russian Federation - LLC;
• Art. 106.1 of the Civil Code of the Russian Federation - regulation of the work of production cooperative structures;
• Federal Law No. 380 - economic partnership;
• Art. 86.1 of the Civil Code of the Russian Federation - a peasant economy.
• Art. 113 of the Civil Code of the Russian Federation - unitary enterprises.

Article 48. The concept of a legal entity

1. A legal entity is an organization that has separate property and is liable for its obligations, can acquire and exercise civil rights and bear civil obligations on its own behalf, be a plaintiff and a defendant in court.
2. A legal entity must be registered in the unified state register of legal entities in one of the organizational and legal forms provided for by this Code.
3. Legal entities, on the property of which their founders have property rights, include state and municipal unitary enterprises, as well as institutions.
Legal entities in respect of which their participants have corporate rights include corporate organizations (Article 65.1).
4. The legal status of the Central Bank of the Russian Federation (Bank of Russia) is determined by the Constitution of the Russian Federation and the law on the Central Bank of the Russian Federation.

Classification of enterprises with the status of a legal entity

According to the classifier, each legal entity, depending on the definition, belongs to the type:

1. Structures created for commerce and enrichment:

• Partnerships and companies of economic type;
• created by the state or municipality;
• Economic partnership and peasant farming.

1. Not pursuing commercial interests:

• Cooperatives for consumer purposes;
• Societies with religious and public interests;
• Institutions funded by the creator in whole or in part;
• Union of Associations;
• Cossack society.

Why is this classification needed?

Law societies are classified to determine the following tasks:

• The purpose of the activity, for what purpose the enterprise was formed, for enrichment or for solving other problems of a non-commercial direction;
• The form itself denotes the permissible structures of the enterprise established by law;
• The nature of the legal relationship between the legal entity and the creator - meaning the presence or absence of the rights of the founders to the ownership of the enterprise.

Commercial structures and their characteristics

For commerce, the main goal of achievements is considered to be the increase in wealth, among the common types of such enterprises are the following.

Business partnerships

The capital of such organizations is formed by equity investment. These partnerships are divided into full and "on faith". In addition, they are limited liability and joint-stock companies.

At the same time, each company is endowed with certain legal nuances:

• A general partnership is characterized by the unconditional liability of participants with their own property for obligations, these formations are quite risky. you will learn how to create a general partnership and what documents are needed for this;
• In a limited partnership, there are, in addition to general partners, investors who risk losing their contributions if their obligations are not fulfilled. Rights and obligations of participants in a limited partnership.

Important: in Russia, such societies are not very common. In addition to them, there are:

• LLC - in this society there are participants who have made a certain contribution to it, and in case of unfulfilled obligations, they are liable only for this contribution, without losing personal property;
• JSC - has a lot in common with LLC, except for the name of the form of ownership, here the founders own a certain number of shares instead of a share. These structures are closed - the shares are distributed among predetermined persons, public - with the right to public placement of shares.

Production cooperative

It is a voluntarily formed variant of activity to achieve a single production or other goal. Their main nuance is the personal voluntary participation of citizens in the process of activity.

Peasant farming

This association is based on the family ties of the participants, but this is not necessary, creating it for the purpose of performing agricultural work for profit.

Such an economy should have a head who is the unconditional leader. All decisions in the economy are made by the general meeting, and property is also common.

Unitary structures

These enterprises are created to solve problems at the state level, provide the population with scarce food, sew the necessary clothes, and so on. Enterprises are given ownership of certain property, it can be a whole economic complex, but at the same time they have no rights to property.

Since such enterprises are created by the authorities, the right to property remains with the owner. In addition, they must coordinate any production decisions with the creator.

Non-profit formations

They are formed for any purpose other than commercial, it can be solutions to global public issues, religious organizations, charitable foundations.

Important: these enterprises are prohibited from prioritizing commercial activities. They are formed in such areas as the media, training, communities of interest.

Non-profit organizations are:

• Consumer cooperatives - a voluntary association of people and their property for their own security, exists on the basis of share contributions, membership in it can be of several types - with the right to vote and only in cases specified by law;
• Public and religious communities that bring together people for non-profit purposes, with the same worldview or spiritual needs. The participants in this society are completely deprived of the right of ownership of the contributed property, the society has the right to engage in entrepreneurship in order to achieve internal needs;
• Foundations - exist on the basis of voluntary contributions and donations, are formed to address public, social and educational issues. There is no membership at all, they have the right to entrepreneurial activity, including the formation of economic companies to achieve the main goals;
• Associations and unions - created on the basis of membership to resolve professional and socially useful issues, in order to protect their own interests, usually such formations arise as a result of the merger of several legal entities engaged in commerce;
• Cossack communities - there is a separate legislative act for their regulation, they are created for the purpose of voluntary service;
• Institutions - created by the owner in order to achieve managerial, cultural or other goals, fully financed by him partially.

Important: the main goals of these enterprises are indicated in the Charter, according to which the organization must strictly follow.

At the same time, a non-profit type organization has the right to have as many participants as there are those who wish, and each of them has the right to take part in the management process, since the Charter in most enterprises provides for a fairly wide range of powers for the general meeting.

Doing business without the status of a legal entity

In addition to the formation of a legal entity, it is possible to engage in commerce, having received the status of an individual entrepreneur, which is a full-fledged subject of civil relations. Becoming an entrepreneur is available from the age of majority by registering with government agencies.

The disadvantage, unlike a legal entity, is that an individual entrepreneur is fully liable with all his property in the event of liability to third parties. He can lose everything, up to the property acquired in the status of an individual.

Important: however, there is also a positive factor - access to the conduct of any type of activity without additional creation of Charters and other constituent documents.

In addition to individual entrepreneurs, there are several more ways to do business without forming an enterprise - branches operating as legal entities and representative offices, whose activities are aimed at protecting the interests and rights of the business.

Conclusion

All of the listed types of organizational and legal forms indicate that the legislation has formed an extensive base for the possibility of determining the necessary type of business in order to achieve the goal.

Varieties of ownership forms are discussed in this video:

What is an OPF? Each organization has its own OPF. The Civil Code of the Russian Federation and other federal laws determine which OPFs can have organizations (legal entities) in the Russian Federation. Haven't guessed yet? Then we answer what it is:

OPF is defined by law and enshrined in the charter of each company or non-profit organization, its legal form. The literal decoding of the abbreviation OPF is a legal term: legal form. You can read more about what the organizational and legal form means for an organization and what types of organizational and legal forms are for commercial and non-profit organizations in Russia, you can read below, in the paragraph Types of OPF .

Meanwhile, decoding OPF may have another meaning - economic, namely: main production assets. What"main production assets"? In the science "Economics of the enterprise", OPF is means of labor involved in the production process for a long time and retaining their natural form. The main production assets of the enterprise include: buildings, structures and structures, communication and power lines, machinery, vehicles and equipment, tools, inventory, etc. (these are the main types of OPF, as fixed production assets). Insofar as OPF in this context, this is an economic concept, and does not affect the main topic of our site - the state registration of non-profit organizations of various organizational and legal forms, those who are important to get more complete information on the topic of the main production assets of the enterprise, we dare to send to the information resource of economic topics. :)

verbatim decoding OPF contains no definition what is the legal form. Strange as it may seem, the main current Russian legislation with the Civil Code at the head does not contain it either! The only, rather vague and vague explanation of the concept of OPF is contained in the All-Russian Classifier of Legal Forms OK 028-2012. According to him, " organizational-legal form means a way of securing (forming) and using property by an organization and its legal status and business goals arising from this. "Well, now everything is clear, isn't it? :)

Let's try to give our own, more intelligible definition:

The organizational and legal form (OPF) is abbreviated letter abbreviation or full verbal designation of the type of organization, always located immediately before its own (individual) name, characterizing the commercial or non-commercial orientation of the organization (in some cases reflecting the main purpose of its activity), as well as characterizing the assignment of this organization to one of the regimes provided for by law fixing and use of property, activities and procedures for managing the organization.

Types of OPF

Here we will decipher the OPF of organizations in detail, while we will be guided by the same All-Russian OPF classifier.

The main types of OPF of commercial enterprises and organizations:

IP - individual entrepreneur

LLC - Limited Liability Company

ALC - additional liability company

OJSC - open joint stock company

CJSC - closed joint stock company

PC - production cooperative

KFH - peasant (farm) economy

SUE - state unitary enterprise

The main types of OPF of non-profit organizations (OPF of NPOs):

PC - consumer cooperative

NGO - public organization

OD - social movement

ANO is an autonomous non-profit organization

SNT - horticultural non-profit partnership

DNP - dacha non-profit partnership

HOA - homeowners association

Of course, the whole range of organizational and legal forms is wider. Here we have deciphered the OPF of the most common types. We hope that you liked this article and that you have learned all the information on the topic " decoding OPF". If you want to clarify how the abbreviation of organizational and legal forms that are not present in the above list is deciphered, or you need to find out the OPF code for the OKOPF of your organization, please look in the OPF classifier located at the following link:

With regard to the process of state registration of an NPO or a commercial organization, the correct and accurate indication of the full and abbreviated name of the legal form (OPF) when preparing documents is a necessary condition for its successful completion.

Sincerely,

staff of the Center for Registration of Non-Commercial Organizations of St. Petersburg and Leningrad Region

When entrepreneurs choose the organizational and legal form of their enterprise, most often they create an LLC or register an individual entrepreneur. But there are other options as well. How to choose the right form for a new organization in 2018.

Read our article:

What is meant by the legal form of a legal entity

To a person who rarely encounters legal terminology, the expression "organizational and legal form of an enterprise" may seem cumbersome and awkward. Such an expression, he thinks, refers to large enterprises that have some special status. But we can talk about the usual LLC. So what is it?

The organizational and legal form of an enterprise is the legal foundation of entrepreneurial activity. This is a system that:

• determines who and how will lead the organization;
• establishes limits of liability;
• predetermines the rules for making transactions and other aspects of economic activity.

For example, in an LLC or JSC, a general meeting of owners manages the business. Management issues are decided by the CEO - within the framework of the powers that are defined in the law and the charter. In particular, the meeting must agree to certain transactions. And in a simple partnership, each of the participants in the organization has the right to conduct business, unless otherwise specified during its creation.

• commercial and non-commercial - by the purpose of creation ();
• unitary and corporate - according to the method of management ().

Before registering a company, the founders decide what it is created for - for profit or for other purposes. If the choice is in favor of the financial component, then the organization will be classified as commercial. And if the main purpose of the activity is not to make a profit, then the choice must be made from the list of non-commercial forms.

What types of organizational and legal forms of enterprises are identified in the law

Let us analyze into what organizational and legal forms the law divides organizations.

What organizational forms are non-profit

1. consumer cooperative. This is a voluntary association of people and their property for the implementation of joint projects. They are quite common: for example, these are GSK, ZhSK, OVS.
2. Public and religious organizations. They are an association of citizens in order to satisfy spiritual or other needs that are not related to the financial side of life (political, for example).
3. Funds. Such an organization exists on voluntary contributions from citizens and legal entities and has no membership. They are created to achieve socially useful goals: educational, charitable, cultural and others.
4. Association of property owners. TSN is based on an association of owners of apartments, dachas, land plots, and other real estate, which TSN members jointly use.
5. Associations (unions). They are created to achieve the common goals of citizens or legal entities.
6. institutions. The owner chooses such a form for the implementation of non-commercial functions, and he also finances the organization. At the same time, an institution is the only type of non-profit organization that has property on the basis of the right of operational management.
7. There are other, less common organizational and legal forms of enterprises: for example, Cossack societies or small communities of indigenous peoples of the peoples of the Russian Federation.

Organizational and legal forms of commercial enterprises: what is it

Commercial forms:

1. Business partnerships. There are both general partnerships and faith-based ones. They differ from each other in the degree of responsibility of the participants. The form is not very popular.
2. production cooperatives. This is a voluntary association of citizens based on membership and share contributions.
3. Business partnerships. Their work is regulated by a separate. A very rare form.
4. Peasant economy. An enterprise that has such an organizational and legal form is an association of citizens for agriculture. It is based on their personal participation in business and property contributions.
5. Economic companies. This is the most popular option for commercial organizations. They are presented in the form of limited liability companies (LLC) and joint-stock companies (JSC).

If a citizen wants to engage in commercial activities, but without forming a legal entity, he has the right to register an individual entrepreneur. This is another popular form of doing business. In the All-Russian classifier of organizational and legal forms (OKOP), the IP has its own number - 50102.

What you need to know about LLC

For enterprises in Russia, LLC is the most common organizational and legal form. Such companies:

• belong to business companies
• conduct business activities,
• bring profit.

The capital of LLC is formed by the contributions of the participants, divided into shares. This form of business organization is suitable for entrepreneurs who, for one reason or another, are not satisfied with the status of an individual entrepreneur. LLC can be quickly created. This form requires less maintenance costs than AO.

What are the main features of AO

JSC is the second most popular organizational and legal form of a legal entity. The capital of the organization is divided into a certain number of shares. JSCs are divided into public (PJSC) and non-public (NJSC). The main difference between them is that in PJSC shares can be freely alienated, in accordance with securities laws.

What are the pros and cons of IP

The main advantages of the IP status:

1. Quick registration.
2. Low stamp duty.
3. Fewer fines compared to legal entities.

The main disadvantage of the IP status is that the entrepreneur is liable for obligations with all his property.

How to choose a form of enterprise for your business

Before choosing the legal form for your enterprise, the manager needs to answer the following questions:

1. How will the company be financed - will it require an investor?
2. Are there any plans to hire staff?
3. What is the expected monthly and annual turnover from the business?
4. Which payment is preferable - cash or non-cash?
5. Is it possible to sell the business?

If we are talking about the most common types of business, then entrepreneurs most often choose between the status of an individual entrepreneur and an LLC:

1. IP registration is faster and easier, and fines are much less. But the citizen will have to answer with all his property.
2. LLCs are convenient for those who open a joint business. The authorized capital is divided into shares, which depend on the size of the participants' contributions. The LLC is not liable for the obligations of the founders, and the founders are not liable for the obligations of the LLC (with the exception of cases of subsidiary liability, which are provided for in the law - for example, in case of bankruptcy). But you will have to pay maximum fines, and maintaining an LLC requires funds.

The type of business organization you choose depends on:

• financial expenses,
• the amount of liability
• limits of authority of governing bodies and much more.