What is an Unlimited Company?
An unlimited Company (UC) is a hybrid corporation that can be formed without the need of a share capital (just like its limited company counterpart), but the legal liability of the members or stakeholders is limitless. As a result, its members or stakeholders have joint, multiple, and unlimited duties to fulfill any shortfall in the corporation ‘s assets in order to settle any outstanding financial burden in the case of the corporation ‘s official dissolution.
Attributes of an Unlimited Company
An unlimited Company (UC) is a hybrid company (corporation) that can be formed without the need of a share capital (just like its limited corporation counterpart), but the legal liability of the members or stakeholders is limitless. As a result, its members or stakeholders have joint, multiple, and unlimited duties to fulfill any shortfall in the corporation ‘s assets in order to settle any outstanding financial burden in the case of the corporation ‘s official dissolution.
The members’ or stakeholders’ joint, multiple, and unlimited liability to satisfy any deficiency in the corporation ‘s assets (to settle any outstanding liabilities, if any exist) occurs only following the corporation ‘s official liquidation. As a result, any creditors or safety holders of the corporation may have recourse prior to any such official liquidation. This only applies to the corporation ‘s assets, not the assets of its members or stakeholders.
Additional optional features
• Unlimited capacity
• Restricted purpose
• An unlimited or limited duration
Possible usability of an Unlimited Company
RAK ICC unlimited companies are flexible and administratively simple corporate vehicles that can be used for several purposes. A UC may be used to avoid the need for shareholder guarantees to support the credit of the UC. For example, where a UC is dealing with a sole customer, it requires recourse to the shareholders of the UC.
• Liability pass through the company in a corporate group
• International tax planning vehicle
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