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How does the concept of limited liability assist big companies to exist in a country

How does the concept of limited liability assist big companies to exist in a country?

On this page we will discuss how the concept of limited liability assists big companies to exist in a country.

How the concept of limited liability assist big companies to cpntinue to exist in a Country

How does the concept of limited liability assist big companies to exist in a country? Well, limited liability companies do benefit from the advantages of corporations, where the largest benefit is the company’s limited liability status. Under limited liability, the company exists as its own legal entity in a country, which protects members and owners from being held personally liable for the operations and debts of the business.

Examples of how companies are protected by limited liability in South Africa

Example 1: an employee of the company is found conducting illegal environmental activities. Legal action can be threatened against the company to pay for damages. The court can go after the assets of the firm, but not the owners, to pay for the damages. The exception would be if the owner was aware of the illegal activities and continually allowed them to happen.

How does the concept of limited liability assist big companies to exist in a country?
How does the concept of limited liability assist big companies to exist in a country?

Resources

https://www.investopedia.com/terms/l/limitedliability.asp

https://www.nolo.com/legal-encyclopedia/limited-liability-protection-llcs-a-50-state-guide.html

https://smallbusiness.chron.com/concept-limited-liability-3693.html

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