TYPES OF

COMPANIES
Types of Companies
• Under the Companies Act, companies are
classified into 2 broad categories.
1. Limited and unlimited companies;
and
2. Private and Public Companies
• A limited company could be either:
• Limited by shares; or
• Limited by guarantee
Types of Companies
• In terms of Private vrs. Public Companies, the distinguishing
feature is the size of the company’s membership and the
manner in which membership to the company may be
procured.
• In all, there are 6 kinds of companies that can be formed and
regulated under the Companies Act:
1. Private Company Limited by shares
2. Private company limited by guarantee
3. Unlimited private company
4. Public company limited by shares
5. Public Company limited by guarantee
6. Unlimited public company
TYPES OF COMPANIES
• Company limited by shares
• The liability of its members is limited to the amount, if any, that remains
unpaid on shares held by each member – Sec 9(1)(a)

• Company Limited by Guarantee

• Liability of members is limited to such amounts as the members may
undertake to contribute to the assets of the company in the event of it
being wound up – Sec 9(1)(b)

• Guarantee companies do not trade to make profit, shareholders are called

members.
• Unlimited Company
• Does not have any limit on the liability of its members
Types of Companies
A Private Company
• A company whose regulations set the following
prohibitions and restrictions
1. it restricts the right to transfer its shares
2. It limits the total number of its members and debenture
holders to 50
3. It prohibits the company from making any invitation to
the public to deposit money for fixed periods or payable
at call
4. It prohibits the company from making any invitation to
the public to acquire any of the company’s shares or
debentures
Sec 9(3)
Types of Companies
• Public Company
• A public company is any company other than a private
company