What is a private enterprise

A private enterprise is such a legal form of ownership in which all property belongs to one or more owners. Civil law of the Russian Federation refers to its varieties: a family business, individual entrepreneurship, the opening of LLC and ZAO.

An individual entrepreneur is an individual who is engaged in entrepreneurship without forming a legal entity. However, the individual entrepreneur must undergo the state registration procedure established by the Civil Code. The private entrepreneur is responsible for the risks with the property of the enterprise. He deals with profit solely at his own risk. Employees of state bodies and bodies of the municipality are not entitled to engage in such activities.

A family business is similar in legal form to individual entrepreneurship. It is based on the work and efforts of one family, not one person. A family business is registered in a simplified manner with the tax authorities. Family business exemptions are also provided for in the amount of taxes paid by the enterprise.

LLC stands for "limited liability company". This is an enterprise whose authorized capital consists of the shares of one or more participants. If necessary, they are responsible for the obligations of the LLC with the amount that they invested in the business. Therefore, the minimum amount of the authorized capital must be established for the LLC. The main purpose of its creation is to obtain financial profit. Immediately after the formation of such a commercial enterprise, the law requires the creation of a governing body, which usually consists of several founders. This is the most common form of legal entity formation.

A closed joint-stock company is also formed by several founders for profit. The company issues a certain number of shares that can be distributed only among the shareholders of this company. The law establishes the maximum possible number of shareholders - there should be no more than fifty of them.