Limited Liability Company (LLC): A Comprehensive Guide

Posted on Nov 1, 2024 in Law & Jurisprudence

Limited Liability Companies (LLCs)

LLCs are a type of capitalist society suitable for companies with few partners and who do not require high capital figures.

General Characteristics

The most important characteristics of LLCs are:

  • The number of partners for their formation is one or more. When formed by a single partner, they are called sole proprietorships. In this case, the partner may be a natural person or a legal entity. It can also happen that the corporation had been formed with two or more partners and that its shares would have become the property of one.
  • The liability of the partners is limited to capital contribution, meaning they are only liable for the debts of the invested capital.
  • The share capital is divided into shares. The shares are equal, cumulative, and indivisible capital of a limited liability company. Their transmission is restricted. The minimum capital must be €3,005.06, and at the time of incorporation, it must be fully subscribed and paid, as capital calls are not supported. This capital may be in cash, property, or rights.
  • The name must consist of the name followed by “Limited Liability Company” or “Limited Company”, or the initials SRL or SL.
  • For the transfer of shares, administrators must be informed of the intended transfer, the number of shares to be disposed of, the identity of the purchaser, and the agreed-upon price. If the remaining partners want to acquire the shares, they have preferential rights. This transmission is to be done in a public document.
  • This company is taxed on corporate income tax.

Constitution

This kind of society has to be established by a public deed, which must be registered within two months in the Commercial Register. The articles of association should include the statutes. These statutes must contain at least:

  • The name of the company.
  • The objectives, identifying the companies involved.
  • The registered office.
  • The social capital, the shares into which it is divided, its nominal value, and consecutive numbering.
  • The way(s) of organizing the administration, under the terms established by law.
  • Other lawful agreements and special conditions that the partners see fit to establish.

Administrative Organs

The management and directorship of the company are entrusted to a corporate body. This governing body consists of the General Meeting of shareholders and managers:

  • General Meeting: It is the deliberative and decision-making body. The issues that the Board can address are: censorship of social management, adoption of annual accounts and the implementation of the outcome of the fiscal year, the appointment and dismissal of directors, and the amendment of the statutes.
  • Administrators: Managing the company can rely on a single administrator or a Board of Directors. Administrators must meet several requirements:
    • They cannot be employed in the same kind of trade that constitutes the object of the society.
    • They serve for the time period stipulated by the charter and may be removed at any time by the General Meeting.
    • To carry out annual accounts, they must follow the rules of corporations.
    • They need to have the status of partners.

Partners

Among the rights of members are the following:

  • Right to participate in the distribution of profits and assets of the company in liquidation.
  • Right of first refusal to acquire the shares of the outgoing partners.
  • Right to participate in social decisions.
  • Right to information given the period set out in the articles of association.

New Company Limited Company


“It’s a kind of society of small-scale enterprises to quickly and easily. Those who choose this new option will have commercial tax deferment and the early years of counseling.
-Trascribirán Activities in the statute literally, be all or some of the following: agriculture, livestock, forestry, fisheries, industrial, construction, trade, tourism, transport, communications, brokering, professional or service general.
“There’s a better regulation in response times and forms through the intensive use of Information Technologies and Communication, which will permit the establishment within 48 hours, compared to 60 days currently required for other types companies. Furthermore, it may convene the General Meeting telematic procedures.
? General Characteristics
• The number of partners for their formation may be of one and five at most.
• The liability of members is limited and for the capital contributed
• The capital shall not be less than 3012 € or more than 120.202 €. The capital is divided into shares.
• The name will consist of both names and the name of one of the founding partners
· This company is taxed on the corporation tax
? Constitution
“It will be decisive Single Electronic Document, which contain all the information regarding the corporation and that may refer to following electronic and telematic techniques, once approved by the council of ministers.
“It provides for advice and starting points for processing. Since these may be requested reservation of company names and will provide information services to entrepreneurs.
? Partners
-They can be partners in the new enterprise society individuals.
“It can not overcome the number of five partners.
“It may form or acquire the status of the sole member of a new society and business who have the status of unique partners in another company of this type.
“It would require the keeping of the partnership register.