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I saw a business name on social media that made me smile and worry at the same time. It’s what made me to share this with you today. I know many people are misusing business forms just like they misuse business titles. You can see this post about the proliferation of corporate titles in Cameroon.
I have seen CEOs that have a sole proprietor business or General Managers / Director Generals / Managing Directors with unregistered businesses.
This one actually was a marvel. I saw a business with ETS XYZCAM SARL. A single business that was a sole proprietor ship and a private limited company at the same time.
For those who don’t know, the name of a sole proprietor business is preceded or followed by the abbreviation “ETS” or word “Etablissement” in French. That of a private limited company is preceded or followed by the abbreviation “SARL” or words “société à responsabilité limitée” in French.
Business forms in Cameroon
Below are some business forms you can find in Cameroon
- General partnership – is a business form where all partners are merchants and jointly and severally liable for the debts of the business. The general partnership can be registered in the name of one or more of the partners and is followed or preceded by the word “partnership” or the abbreviation “P”.
- Limited liability partnership – this is a partnership where one or more partners (referred to as general partners)are jointly and severally liable for the debts of the business. You also have the limited liability partners or limited partners whose liabilities are limited to their contributions in the partnership. The limited liability partnership is given a followed or preceded by the word “limited partnership” or the abbreviation “LP”. Note that the name of a limited may never be registered into the businesses name. If it is done, the limited partner will be jointly and severally liable for the debts of the company.
- Private limited company – is a business form where the liability for the company’s debts is limited proportionally to the contributions of the members. It may be formed by a single person or legal entity as well as two or more legal entities and natural persons. The rights of the shareholders are represented by their equity interests. A name shall be designated to the company which shall be preceded or followed by the words “private limited company” or abbreviated “PLC”. In Cameroon, minimum authorized or stated capital is one hundred thousand francs CFA (XAF100,000) that is divided into equal equity interests with a nominal value not less than five thousand francs CFA (XAF5000).
- Public limited company – is a business form where shareholders liability for the company’s debt ends at the level of their contributions. The rights of the shareholders are represented by shares. A name shall be designated to the company which shall be preceded or followed by the words “public limited company” or abbreviated “P.L.C”. In Cameroon, minimum authorized or stated capital is ten million francs CFA (XAF10,000,000) that is divided shares with a nominal freely decided upon in the articles of association and expressed in whole numbers.
- Consortium – a business form whereby the partners have agreed not to register it with the Trade and Personal Property Credit Register. Such an entity has no legal personality and not subject to publicity.
- Economic interest group – a business form where the sole purpose is to put together necessary resources for a fixed term to facilitate or develop economic activities for its members.
Image Credit: ‘Confused’ by Steve Buissinne from Pixabay
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This content has been prepared for information purposes only. It is not intended to provide, and should not be relied on for, tax, accounting or legal advice. You need to consult your own tax, accounting or legal advisors before engaging in any transaction.