The joint-stock company

A joint-stock company (JSC) is a commercial organisation whose charter capital is divided into shares and which is formed on the voluntary contributions of shareholders; for this reason it is one of the largest forms of business. A share is a security proving that its owner has contributed to the company’s capital and has the right to a dividend from profit; the value written on it is the nominal value, and all shares issued by a company must have the same nominal value. An ordinary share gives its owner the right to vote, to receive a dividend and to take part in management at the general meeting; a preferred share gives priority in dividends and in getting back funds when the company is wound up, but often carries no vote. According to the textbook, a 2014 law abolished the difference between open and closed joint-stock companies, so they are now called simply JSCs, and the minimum charter capital is set by law (check the current amount in the law). The advantage of a JSC is that by issuing many shares it can quickly pool a large sum; the disadvantage is that management is complex because there are many shareholders and decisions are discussed at meetings, which can slow work. For this reason governing bodies are formed (the general meeting, the supervisory board and an executive head). Dividends from shares and income from selling shares are taxed under the Tax Code; check the rate in the Code.