September 8, 2010, 4:22 pm
The Civil Code of the Republic of Armenia provides sole proprietorships, limited liability companies, joint stock companies, and general and limited partnerships as legal entities. Most of Armenian companies are small and medium-sized companies, functioning as sole proprietorships and limited liability companies.
Create a Sole Proprietorship in Armenia
An Armenian sole proprietorship is basically an ordinary sole proprietorship. It is the simplest form of business organization. It represents a business entity owned and managed by one single person, or in some cases married couples. The major characteristic is that there is no distinction made between the owner and his or her company. This means the owner is fully liable to his business debts and obligations to the extent of his or her own personal assets.
Open a Limited Liability Company in Armenia
As sole proprietorships, Armenian limited liability companies are a common form of business organization, as they have no complex organization procedures and are fit for small and medium business. An Armenian limited liability company can be established by one or more persons who are liable for the company's debts and obligations, only to the extent of their investments. Prior to registration the founders must fully pay the initial capital. The profits are divided among founders according to the stipulations in the charter.
Open a Joint Stock Company in Armenia
The Armenian joint stock company is a legal entity with a charter capital divided into a defined number of shares. The founders establish the nominal value of the shares. Their liability is limited to the value of their possessed share. The Armenian open joint stock company is different from the closed one having stocks available for sale to the public. The minimum required capital for an open JSC is 1.000 times the minimum monthly wage. Prior to founding a JSC the founders must fully pay the minimum required capital.
Armenian Closed Joint Stock Company
The closed JSC functions the same as a regular JSC, having a capital divided among shareholders, with a determined nominal value per share and limited liability for each shareholder. The main difference is that in a closed JSC shareholders cannot sale their shares to the public, the stocks being owned only by the founders. Also a closed JSC requires a minimum capital reduced to 100 times the minimum monthly wage.
Create an Armenian General Partnership
The general partnership in Armenia can be established by at least two persons that represent the business entity and act as the owners of the company. All the partners of this partnership type are general, and bear full liability to the company's debts and obligations to the extent of their personal assets.
Open an Armenian Limited Partnership
This partnership type is also formed by two or more persons who are the owners or contributors to the partnership. The main difference refers to the liability of the partners. In a limited partnership at least one member is general and has the right to manage the company, but also bears full liability to the partnerships' debts and obligations, while at least one member is a limited partnership, meaning he bears limited liability to the extent of his or her contribution to the partnerships' capital.