What Are The Advantages And Disadvantages Of Private Limited Company

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Executive Summary In Pakistan, the formal process that Private Limited Companies must undergo is dictated by the Companies Ordinance 1984. The documents that need to be submitted along with all the authorization required is outlined in the ordinance. The formulation, conditions, requirements; everything must be adhered to before it can register with the SECP and begin its operations. Depending upon the category of company, approval is take from certain designated ministries or departments. Prior to registration, the initiators must determine a suitable source of capital. Registration is undertaken by the company registration office. The advantages that come with this form of company include limited liability, unlimited life and tax benefits whereas the disadvantages are inclusive of limited…show more content…
Transfer and Sale of Shares Private limited company cannot sell its shares and the shares are not transferrable without the consent of other shareholders. In a public limited company, anyone can sell their shares anytime they want without anyone’s consent. ix. Dissolution Under company’s ordinance, separate and different procedures have been provided for dissolution of private company and public company. Advantages and Disadvantages of Private Limited Company: Advantages: Company’s registration in Pakistan A common perception among people is that by registering their business as Private Limited Company their business is going to progress very rapidly as compare to any other business. The perception in simpler words is completely wrong. First thing while starting a business is not the company registration, the first thing to focus on is to have a workable business plan and idea that in your perception has enough strength to earn you sufficient income as per your plan. Once planning and arrangement of capital is finalized next step comes to company registration. Company registration is in simple words is providing your business with legal cover. Private Limited

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