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Joint Stock Company

Definition

A joint-stock company is a business entity in which shares of the company's stock can be bought and sold by shareholders. Each shareholder owns company stock in proportion, evidenced by their shares. Shareholders are able to transfer their shares to others without any effects to the continued existence of the company.

What is a 'Joint Stock Company'

A joint stock company is an organization that falls between the definitions of a partnership and corporation in terms of shareholder liability. In the United States, shareholders of joint stock companies have unlimited liability for company debts, but in the United Kingdom, shareholder liability is limited to the nominal value of shares held by each shareholder.

Explaining 'Joint Stock Company'

In 17th-century England, joint stock companies were the forerunner to the modern business structure of a corporation. In many cases, these companies were chartered by the Crown of England for the purpose of undertaking high-risk endeavors that would return a profit. Capital was raised through the investment of wealthy individuals who would share in the profits with liability limited to the amount of their initial investment. In American history, the Virginia Company of London is the most familiar joint stock company.

Historical Example of a Joint Stock Company

In 1606, King James chartered the Virginia Company of London as a joint stock company. The Virginia Company was formed as a profit-making venture for the purpose of colonizing the New World for England. The company sold shares to raise capital, entitling each shareholder to a proportional share of the net profits while limiting their total liability to the value of their shareholdings. The company sponsored three ships to set sail for Virginia, where they established a small colony on Jamestown Island.


Further Reading


Legal origin, juridical form and industrialization in historical perspective: the case of the employment contract and the joint-stock company
academic.oup.com [PDF]
… 3 CHAPTER TWO British Politics from 1672 to 1712 CHAPTER THREE Finance and State … Rights and the State CHAPTER SIX Politics and the Joint-Stock Companies CHAPTER SEVEN … Funded and Total Debt, 1692–1730 Market Prices of Joint-Stock Company Shares, January …

Path dependence, change and the emergence of the first joint-stock companiesPath dependence, change and the emergence of the first joint-stock companies
www.tandfonline.com [PDF]
… 3 CHAPTER TWO British Politics from 1672 to 1712 CHAPTER THREE Finance and State … Rights and the State CHAPTER SIX Politics and the Joint-Stock Companies CHAPTER SEVEN … Funded and Total Debt, 1692–1730 Market Prices of Joint-Stock Company Shares, January …

Voluntary financial reporting on the internet: analysis of the practice of stock-market listed croatian and slovene joint stock companiesVoluntary financial reporting on the internet: analysis of the practice of stock-market listed croatian and slovene joint stock companies
hrcak.srce.hr [PDF]
… 3 CHAPTER TWO British Politics from 1672 to 1712 CHAPTER THREE Finance and State … Rights and the State CHAPTER SIX Politics and the Joint-Stock Companies CHAPTER SEVEN … Funded and Total Debt, 1692–1730 Market Prices of Joint-Stock Company Shares, January …

Capitalism without the capitalist: The joint stock company share and the emergence of the modern doctrine of separate corporate personalityCapitalism without the capitalist: The joint stock company share and the emergence of the modern doctrine of separate corporate personality
www.tandfonline.com [PDF]
… 3 CHAPTER TWO British Politics from 1672 to 1712 CHAPTER THREE Finance and State … Rights and the State CHAPTER SIX Politics and the Joint-Stock Companies CHAPTER SEVEN … Funded and Total Debt, 1692–1730 Market Prices of Joint-Stock Company Shares, January …

Female investors in the first English and Welsh commercial joint-stock banksFemale investors in the first English and Welsh commercial joint-stock banks
www.tandfonline.com [PDF]
… 3 CHAPTER TWO British Politics from 1672 to 1712 CHAPTER THREE Finance and State … Rights and the State CHAPTER SIX Politics and the Joint-Stock Companies CHAPTER SEVEN … Funded and Total Debt, 1692–1730 Market Prices of Joint-Stock Company Shares, January …

Legal forms of joint-stock companies and corporate behavior in RussiaLegal forms of joint-stock companies and corporate behavior in Russia
www.tandfonline.com [PDF]
… 3 CHAPTER TWO British Politics from 1672 to 1712 CHAPTER THREE Finance and State … Rights and the State CHAPTER SIX Politics and the Joint-Stock Companies CHAPTER SEVEN … Funded and Total Debt, 1692–1730 Market Prices of Joint-Stock Company Shares, January …



FAQ


What is a joint-stock company?

A joint-stock company is a business entity in which shares of stock can be bought and sold by shareholders.

How do you buy and sell shares of stock in a joint-stock company?

Shares are traded via brokers on various exchanges throughout the world. The largest being the New York Stock Exchange (NYSE), NASDAQ, London Stock Exchange (LSE) and Euronext.

What does it mean to have limited liability as an owner of a share in a joint-stock company?

Shareholders are only liable for the value of their investment in the company's stock.

Are there any countries that still provide for registration of joint-stock companies without limited liability?

What is the difference between incorporation and registration as separate entities?

How are corporations formed today?

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