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Concept
Unlimited company
Résumé
An unlimited company or private unlimited company is a hybrid company (corporation) incorporated with or without a share capital (and similar to its limited company counterpart) but where the legal liability of the members or shareholders is not limited: that is, its members or shareholders have a joint and several non-limited obligation to meet any insufficiency in the assets of the company to enable settlement of any outstanding financial liability in the event of the company's formal liquidation.
The joint and several non-limited liability of the members or shareholders of such an unlimited company to meet any insufficiency in the assets of the company (to settle its outstanding liabilities if any exist) applies only upon the formal liquidation of the company. Therefore, prior to any such formal liquidation of the company, any creditors or security holders of the company may have recourse only to the assets of the company, not those of its members or shareholders.
Until such an event occurs (formal liquidation), an unlimited company is similar to its counterpart—the limited company, in which its members or shareholders have no direct liability to the creditors or security holders of the company during its normal course of business or existence.
Unlimited companies are found in the United Kingdom, Ireland, Hong Kong, Pakistan, Nigeria, India, Australia, New Zealand and other jurisdictions where the company law is derived from English law. They can also be found in Germany, France, Macao, Czech Republic and in three jurisdictions in Canada (Alberta, British Columbia, and Nova Scotia), where they are called unlimited liability corporations. In the United Kingdom, the "private unlimited company" is formed or incorporated by registration under the Companies Act 2006, of which there are a few thousand such companies on the register, similar in volume to the public limited company, but in contrast to the millions of private limited companies registered.
An unlimited company has the benefit and status of incorporation, the same as its limited company counterpart.
Source officielle
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