A form of business which limits liability to the assets of the company, and does not extend to the personal assets of the shareholders or offices of the company.
as established by statute, the limiting of legal liability below that otherwise available at common law, and usually limited to the amount of one's investment in a corporation
a legal structure in which creditors of a business can demand from owners no more than the owners' investment in the business
the liability of a member of a company to contribute capital to the company that is limited to a known amount agreed between the company and the member.
responsibility for debts up to the value of the company's share capital.
Shareholders are not liable for the debts of the company over and above the money they have subscribed through the purchase of the company's shares. This is known as limited liability.
A restriction of the owner's loss in the business to the amount of capital invested.
A limitation on the maximum amount a business owner can lose if the business is subject to debts or claims against the business.
If a company is set up with limited liability for its members, a limit is put on how much the members would have to pay if the company was wound up.
The right of an investor to limit potential losses to no more than the amount invested. Equity shareholders, such as corporate stockholders and limited partners, have limited liability.
The restriction of a person's potential losses to the amount invested and does not go beyond that.
1. Restricted liability for obligations. 2. (USA) Limitation of Liability Act. A U.S. statute which permits a shipowner to restrict his liability to whatever value his ship has after an event such as a sinking or collision.
A form of company structure under which shareholders' liabilities are limited to the value of their shares in the company, even when the debts of the company actually exceed that value.
A feature inherent in corporations; stockholder's responsibility for debts is restricted to the amount of their investment in the corporation.
A characteristic of certain business entities in which the liability of a business owner is limited to the amount of his or her capital investment. The personal assets of the owner are generally not at risk for the debts and obligations of the business. To learn more about limited liability protection in a corporation, click here.
Liability limited by law or by contract. Usually in reference to the liability cap that limits company owners liability to their investment.
Limitation of shareholder's losses to the amount invested.
The liability of a firm's owners (in the case of a lawsuit, for example) for no more money than they have invested in the business. Thus, a stockholder can lose no more than he or she has paid for shares of ownership regardless of the firm's financial obligations. Limited liability is one of the major advantages of organizing a company as a corporation. (See also Corporation.) View LEI Lesson(s) that address this term
the liability of a firm's owners for no more than the capital they have invested in the firm
refers to liabilities being limited to a company itself and creditors not having legal rights to recover their funds from shareholders of the company in the event the company defaults in the repayment of its debt obligations.
Limitation of shareholders' losses to the amount invested.
The maximum amount a person can lose if a business is subject to debts, claims or other liabilities. Sole traders or partnerships generally do not have limited liability. Corporations do.
Limited liability means that a debtor is responsible for repaying creditors only a certain amount of debt. For instance, shareholders of a joint-stock company, who have limited liability, are not required to take responsibility beyond the amount of their investments if the firm faces a negative net worth and goes under. The rule encourages investors to sink money into joint-stock companies, since they can estimate beforehand the losses they will incur if their company fails. Meanwhile, a joint venture by a number of individuals and institutions, which does not take the form of a joint-stock company, is defined as an association under the civil code. The members of such an association are required to be responsible for all of losses generated through its business activities. In other words, they have unlimited liabilities and can suffer losses beyond the amount of their investments in the venture.
The word limited at the end of a Canadian company's name implies that liability of the company's shareholders is limited to the money they paid to buy the share. By contrast, ownership by a sole proprietor or partnership carries unlimited personal legal responsibility for debts incurred by the business.
Limits the possible loss to what has already been invested.
Entities limiting liability If a taxpayer holds his working interest through any of the following entities, the entity is considered to limit his liability, and the taxpayer's interest in the activity will not be exempt from the passive loss rules 1. A limited partnership interest is a partnership in which the taxpayer is not a general partner. 2. Stock in a corporation. 3. Any entity other than a limited partnership or corporation that, under applicable state law, limits the potential liability of a holder of such interests for all obligations of the entity to a determinable fixed amount. (e.g., the taxpayer's capital contributions).
Liability limited by a law or by contract.
A Company in which the liability of each Shareholder is limited to the amount of shares owned.
The liability of an owner of a Corporation, LLC, or Statutory Trust for the business debts of the entity is limited to the ownerâ€(tm)s investment in the entity. Ownersâ€(tm) personal assets are protected.
The key benefit of incorporation. Limited liability restricts the personal liability of the shareholders to the amount paid for their stock.
Restricted liability for the obligations of a business.
A type of liability that does not exceed the initial amount a person invested into a partnership.
Within the context of our site it's limited liability of shareholders or members in a Company Limited by Shares or Company Limited by Guarantee.
Owners are not personally liable for debts.
Limitation of shareholders' liability to the extent of their share capital subscription.
A situation in which an investor can lose no more than the amount invested.
A company structure in which a shareholder's liability is limited to the value of his/her shares in the company.
usually refers to limited companies where the owners' liability to pay the debts of the company is limited to the value of their shares or the amount of their guarantee (guarantee company). But it can also apply to contracts where a valid limitation clause has been included in the terms - not all limitation clauses are valid.
The liability of the shareholders of a Company for the debts of that Company is limited to the nominal amount of the shares they hold or to the amount they have guaranteed.
The restriction of one's potential losses to the amount invested. The absence of personal liability
The legal protection given stockholders whereby they are responsible for the debts and obligations of a corporation only to the extent of their capital contributions.
Shareholders in a limited company are only liable to third parties to the limit of their shareholding. Other participants e.g. directors would not normally have any personal liability except with respect to creditors where there has been wrongful or fraudulent trading or when personal guarantees or other such undertakings have been given by directors or others.
A condition in which owners are not personally held responsible for the debts of by a firm. Corporations are the main form of business in which owners have limited liability. The primary benefit of limited liability is that it makes it possible for a business to accumulate large amounts of productive resources that lets it take advantage of large scale production. Contrast to unlimited liability.
Limitation of possible loss to what has already been invested.
The maximum amount a person participating in a business can lose or be charged in case of claims against the company or its bankruptcy. A stockholder in a corporation can only lose his/her investment.
The legal protection given to stockholders of a corporation. A stockholder's liability extends only to the total of his capital contribution.
The liability of shareholders is limited to the fully paid value of the shares held. If partly paid shares are held in a limited company and a call is made, the holder is liable to pay the call. A person taking up shares in a company knows from the beginning the extent of his individual liability.
when the liability of shareholders is limited to the value of their shares
A form of company structure whereby no matter how great the debts of the company may be, the shareholders’ liability is limited to the value of their shares in the company.
The maximum amount a business owner can lose if the business is subject to debts, claims or other liabilities. An owner of a limited liability company (LLC) or a person who invests in a corporation (a shareholder) generally stands to lose only the amount of money invested in the business. This means that if the business folds, creditors cannot seize or sell an owner's home, car, or other personal assets.
Condition in which an investor cannot lose more money than the amount that was invested.
The liability of stockholders of a business corporation that extends no further than to payment of the full par value of the issued and outstanding capital stock, such limited liability being one of the principal advantages of the corporate form of business organization
When "limited" is at the end of a Canadian company's name, the company's shareholders' responsibility for the debts of the company is limited to the amount of money they paid to buy the shares. In contrast, ownership of a company by a sole proprietor or partnership carries unlimited personal legal responsibility for debts incurred by the business.
The liability of the shareholders in a limited company, Private or Public, is limited to the face of the shares held. If therefore, the shares are fully paid, the shareholder has no liability for the debts of the company.
Limited liability is a concept whereby a person's financial liability is limited to a fixed sum, most commonly the value of a person's investment in a company or partnership with limited liability. A shareholder in a limited liability company is not personally liable for any of the debts of the company, other than for the value of his investment in that company. The same is true for the members of a limited liability partnership and the limited partners in a limited partnership.