1. Types of business organization under new commercial code of Ethiopia ?
The new commercial code of Ethiopia recognizes the following types of business organizations:
1. Sole Proprietorship: A business owned and operated by a single individual. The owner is fully responsible for all debts and liabilities of the business.
2. Partnership: A business owned by two or more individuals who share in the profits and losses of the business. There are two types of partnerships recognized in the new commercial code: general partnership and limited partnership.
3. Limited Liability Company (LLC): A business structure that combines the limited liability of a corporation with the tax benefits of a partnership. Owners of an LLC are not personally liable for the debts and liabilities of the company.
4. Joint Stock Company: A company that issues shares of stock to investors and operates as a separate legal entity. Shareholders are not personally liable for the debts and liabilities of the company.
5. Branch Office: A business entity that is established as an extension of a foreign company and operates in Ethiopia.
6. Representative Office: A business entity that is established by a foreign company to conduct marketing and promotional activities in Ethiopia, but cannot engage in commercial transactions.
7. Public Enterprises: Business organizations that are wholly or partially owned by the government and operate in sectors deemed strategic or essential for the public interest.
These are the main types of business organizations recognized under the new commercial code of Ethiopia. Each type of organization has its own set of advantages and disadvantages, and entrepreneurs should carefully consider their options before choosing a business structure.