GOVERNMENT

COMPANY
 FORMATION

FEATURES SEPARATE LEGAL ENTITY

OF A SOURCE OF CAPITAL
GOVERNMENT
MANAGEMENT
COMAPNY
AUTONOMY
 The legal status of GOC varies from being
a part of the government to being stock
companies with the state as a regular
stockholder. The defining characteristics
of SOE's are that they have a distinct
legal form and they are established to
operate in commercial affairs. While they
may also have public policy objectives,
SOEs should be differentiated from other
forms of government agencies or state
entities established to pursue purely non-
financial objectives.
It has a separate financing
body government provide
funds by taking major
shareholding The company
can borrow . private
participation is also possible
The management of the company
is regulated by the provisions
of companies act like any other
public ltd. Company. The
company is managed by board
of directors as per the
articles of association if that
company.
Independent Business Policies

Benefit Of Expertise

Additional Finance Resources

LIMITATIONS OF GOVERNMENT
COMPANIES:-
GOVERNMENT EMPLOYEES ARE ON
DEPUTATION. THEIR POSTING IS
TRANSFERABLE. APOOINTMENT IS MADE FOR
CERTAIN FIXED PERIOD. AFTER THE EXPIRY
TERM THE EMPLOYEE IS REPLACED BY OTHER
INEXPERIENCED EMPLOYEES.
GOVERNMENT COMPANIES ARE
GENERALLY MANAGED BY
GOVERNMENT ADMINISTRATIONS. WHO
ARE NOT COMPETENT PROFESSIONAL
MANAGERS. THIS IS WHY, THESE
COMPANIES ARE NOT ABLE TO EARN
HANDSOME PROFIT.