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3.Suppose that Bob and Cobb are thinking about setting up a corporation. They will have three employees in addition to themselves, and they expect the company to earn approximately $250,000 a year before taxes and salaries are paid. They want to have control over the running of the business but are nervous about incurring personal liability. Should they incorporate or would they be better of picking a different business form? Please discuss at least two different business forms in your answer and explain why one is a better choice than the other for this business.
- 1 0 年前最佳解答
the form of the business shall be subject to the law of establishment
Suppose it is formed in Taiwan. To prevent personal liabliity, the two settlors/investors can
1. a limited company or a share-holdong limited company registered with
the ministry of economics
The shareholders will be only responsible for the sunk fund in the form of paid-in capital. They will suffer losses no more than the value of their share-holding.
The board or the general manager will not be liable for losses incurred in the course of business if they can within the law bona fide.
2. partnership registered with local government
If Bob and Cobb run their business in the form of partnership they will be personally liable for all debts and liabilities incurred in the course of business.
It is therefore more desirable to chose the first form of business as Bob and Cobb will not be liable for any debts or loss other than the paid-in capital/share-holding.
Let me know if translation is required.參考資料： Advocate in Taiwan; PhD LSE UK