Forms of Business Forms of Business Organization in the Organization in the

USAUSA

Unit 33Unit 33

Read the text page 151 and complete Read the text page 151 and complete the following tablethe following table

FORM OFFORM OF

BUSINESSBUSINESS

ORGANIZATIONORGANIZATION

Owner(s) Owner(s) //

Way of Way of foundingfounding

Control Control over the over the business / business / profitprofit

ResposibilitResposibility / liabilityy / liability

Other Other

featuresfeatures

Sole Sole

proprietorshipsproprietorships

PartnershipsPartnerships

CorporationsCorporations

CompareCompare the US and Croatian B. the US and Croatian B. OrganizationsOrganizations

SOLE SOLE

PROPPROPRRIETORSHIPIETORSHIP TRGOVAC POJEDINACTRGOVAC POJEDINAC

PARTNERSHIP PARTNERSHIP (association of (association of

persons)persons)

a)a) general p.general p.

b)b) limited p.limited p.

TRGOVAČKO DRUŠTVOTRGOVAČKO DRUŠTVO(društva osoba)(društva osoba)

a)a) javno trgovačko javno trgovačko društvodruštvo

b)b) komanditno društvokomanditno društvo

CORPORATIONCORPORATION**(association of (association of

capital)capital)

a)a) C-corporationC-corporation

b)b) S-corporation S-corporation

TRGOVAČKO DRUŠTVOTRGOVAČKO DRUŠTVO(društva kapitala)(društva kapitala)

a)a) dioničko društvo d.d. dioničko društvo d.d. ((AGAG))

b)b) d.o.o. d.o.o. ((GmbHGmbH))*Uniform Commercial Code (S-section / C-section) Zakon o trgovačkim društvima - ZTD

Study the following collocations.Study the following collocations.Turn nominal phrases into verbal phrases.Turn nominal phrases into verbal phrases.

1.1. formation of a businessformation of a business →→ to form a businessto form a business

2.2. possibilities of growth and expansion possibilities of growth and expansion

3.3. responsibility for the losses, debts, etc.responsibility for the losses, debts, etc.

4.4. association of two or more persons as co-ownersassociation of two or more persons as co-owners

5.5. voluntary agreement of partnersvoluntary agreement of partners to something to something

6.6. equal profit sharingequal profit sharing

7.7. combination and utilization of labocombination and utilization of labouur, capital, etc.r, capital, etc.

8.8. creation of a corporationcreation of a corporation

9.9. transferability of sharestransferability of shares

10.10. professional management of a corporationprofessional management of a corporation

a) Which nouns collocate with the following a) Which nouns collocate with the following verbs? verbs? b) Which of the 3 forms of business b) Which of the 3 forms of business organization organization does each of them refer to? does each of them refer to? c) Write sentence examples.c) Write sentence examples.

1.1. to enjoy...to enjoy...

2.2. to incur...to incur...

3.3. to share...to share...

4.4. to utilize...to utilize...

5.5. to carry on...to carry on...

Find the words of opposite meaning – Find the words of opposite meaning – antonyms.antonyms.

1.1. a retail storea retail store

2.2. individual ownershipindividual ownership

3.3. full liabilityfull liability

4.4. an artificial personan artificial person

KEY – antonyms.KEY – antonyms.

1.1. a retail store a retail store ≠ wholesale (veletrgovina)≠ wholesale (veletrgovina)

2.2. individual ownership individual ownership ≠ partnership (trgovačko ≠ partnership (trgovačko društvo) društvo)

3.3. full liability full liability ≠ limited liability (ograničena ≠ limited liability (ograničena odgovornost)odgovornost)

4.4. an artificial / legal / juristic person an artificial / legal / juristic person ≠ natural ≠ natural person (fizička osoba)person (fizička osoba)

Read the following definition of a company Read the following definition of a company and compare it with the definition of a and compare it with the definition of a

corporation in your book, p. 151corporation in your book, p. 151

A A companycompany** is a business association which has the is a business association which has the character of a legal person, distinct from its character of a legal person, distinct from its officers and shareholders. This is significant, as it officers and shareholders. This is significant, as it aallllows the company to own property in its own ows the company to own property in its own name, continue perpetually despite changes in name, continue perpetually despite changes in ownership, anownership, andd insulate the owners against insulate the owners against personal liability. However, in some instances, for personal liability. However, in some instances, for example when the company is used to perpetrate example when the company is used to perpetrate fraud..., the court may “lift the corporate veil” anfraud..., the court may “lift the corporate veil” andd subject the shareholders to personal liability. subject the shareholders to personal liability.

* company = corporation in the USA* company = corporation in the USA

Make notes which will help you explain Make notes which will help you explain to an American business partner how to an American business partner how

Croatian Commercial Code (ZTD) Croatian Commercial Code (ZTD) defines the term: defines the term:

JJavno trgovačko društvoavno trgovačko društvoPojam javnoga trgovačkoga društva – Članaka 68Pojam javnoga trgovačkoga društva – Članaka 68(1)(1) Javno trgovačko društvo je trgovačko društvo Javno trgovačko društvo je trgovačko društvo

u koje se udružuju dvije ili više osoba zbog u koje se udružuju dvije ili više osoba zbog trajnog obavljanja djelatnosti pod trajnog obavljanja djelatnosti pod zajedničkom tvrtkom, a svaki član društva zajedničkom tvrtkom, a svaki član društva odgovara vjerovnicima društva neograničeno odgovara vjerovnicima društva neograničeno solidarno cijelom svojom imovinom.solidarno cijelom svojom imovinom.

(2)(2) Član društva može biti svaka fizička ili pravna Član društva može biti svaka fizička ili pravna osoba.osoba.

Answer the following questions.Answer the following questions.

1.1. Which forms of business organizations are Which forms of business organizations are there in the USA?there in the USA?

2.2. Which criteria are normally taken into Which criteria are normally taken into consideration when people consider consideration when people consider formation of a new business? (5 criteria)formation of a new business? (5 criteria)

3.3. Which are the examples of businesses that Which are the examples of businesses that function as sole proprietorships?function as sole proprietorships?

4.4. What are the adventages and What are the adventages and disadventages of sole proprietorship?disadventages of sole proprietorship?

5.5. What is the main precondition for What is the main precondition for establishing a partnership?establishing a partnership?

Questions – PART 2Questions – PART 2

6. What kind of equality is the basis for the 6. What kind of equality is the basis for the functioning of a partnership?functioning of a partnership?

7. What is the way to create a corporation?7. What is the way to create a corporation?

8. What is the position of corporations in the 8. What is the position of corporations in the USA considering the size or volume of USA considering the size or volume of business being done?business being done?

9. What are the main attributes of a 9. What are the main attributes of a corporation?corporation?

10. Which Croatian forms of business 10. Which Croatian forms of business organizations are you familiar with? organizations are you familiar with?