Practice question · Sort into groups
A venture must choose its legal form. Sort each situation by the better fit.
Groups: S.L. fits better · S.A. fits better
- Consultancy of five partners who vet every newcomer
- A bank, required by sector law to be an S.A.
- A utility raising 80M€ from thousands of investors
- A firm preparing to list on the stock exchange
- Three siblings opening a bakery chain
Hints
- Ask whether the venture needs closed doors or open capital markets.
- Regulated or capital-hungry ventures need the open architecture.
Show the answer
S.L. fits better: Three siblings opening a bakery chain, Consultancy of five partners who vet every newcomer
S.A. fits better: A utility raising 80M€ from thousands of investors, A firm preparing to list on the stock exchange, A bank, required by sector law to be an S.A.
Why
Trust-based ventures want the S.L.’s closed doors; capital-hungry or regulated ventures need the S.A.’s open architecture.
Practise Joint-Stock Companies (S.A.)
The app has 7 more questions on this lesson, and keeps your place in the course. Business I is free to start.
More questions on Joint-Stock Companies (S.A.)
- An S.A. issues 10,000 shares of 10€ nominal value at a price of 14€ each. Set the slider to the total share…
- Match each S.A. term to its meaning.
- Why does the law demand 60,000€ minimum capital for an S.A. but only 3,000€ for an S.L.?
- An S.A.'s minimum capital of 60,000€ is often described as protecting creditors. Why is that protection…
- Which rights does an ordinary S.A. share confer on its holder?
- The law lets an S.A. be founded with capital subscribed but only partly paid up. What is that distinction…