GgfNnn88 Nama: Lutfi Prima Dani

NIM: 233141507111027

Class: K1F

Private vs Public ownership

BACKGROUND

There are differences between a private limited company and a

public limited company. The difference between a private limited

company can provide explicit knowledge of each type of company and

its advantages and disadvantages.

There are many types of companies, but mainly private limited

and public limited are the types of company. The public company

means those companies traded publicly in terms of security and

recognized stock exchange. The private limited company is the one that

is not listed in the stock exchange, and its security is held by its

members of the organisation privately. Before knowing about

entrepreneurship, it is essential to know about the types and best

suitable kind to start a business.

A. PROBLEM STATEMEN

1. What is the Definition of a public limited company ?

2. What is the Definition of a Private limited company ?

3. What is the difference between public limited companies and private

limited companies ?
 B. PURPOSE OF PAPER

1. To know the Definition of a public limited company

2. To know the Definition of a Private limited company

3. To know the Difference between public limited companies and

private limited companie.

DISCUSSION

A. Public limited company

According to the Companies’ Act 2013, a public limited company is not

private. This means a public limited company is a joint-stock company

governed by the provision of the Indian Companies’ Act 2013. There is no

limit to the number of members, and it is formed by an association where

people are voluntarily paid up to five lakhs rupees capital. There is no

restriction in transferability, and in time of incorporation, the term public

limited is added to its name. A public limited company offers shares to the

public. It is more open to the public about its details and also listed in the

stock market.1

A public company is a business entity in the form of a limited liability

company that can raise capital from the public or the general public through

trading stock securities. In Law no. 40 of 2007 concerning limited liability

companies, public companies are categorized as companies whose shares are

owned by at least 300 shareholders and have paid-up capital of at least IDR 3

1
Sinambela, L.P dkk, 2008, Reformasi Pelayanan Publik (Teori, Kebijakan, dan
Implementasi), Jakarta :Bumi Aksara, h 11
 billion. As a marker for public companies there is an additional identity, Tbk,

short for open, which is inserted into the company's last name.2

B. Private limited company

A private company or closed company is a business company owned by

a non-governmental organization or a small group of shareholders or

company members that does not offer or trade its company stock (shares) to

the general public through the stock market, but the company shares are

offered, owned and traded or exchanged privately. Less ambiguous terms for

private companies are unlisted companies and unregistered companies.

According to the Companies’ Act 2013, private companies are restricted

from transferring their share. In simple words, a private limited company is

a joint-stock company governed under the Indian Companies’ Act 2013. It

has limitations in the number of members. Still, the voluntary association of

the company should be paid a minimum of 1 lakh rupees capital. The

maximum number of members should be 200, and it does not include

current or ex-employees who are not listed in the employment term.

Employees are allowed to continue as a member after the termination of

employment in the company. There is a restriction in transferring the shares.

The term private limited is used in the name of the company.3

A private company is a firm held under private ownership. Private

companies may issue stock and have shareholders, but their shares do not

trade on public exchanges and are not issued through an initial public

offering (IPO). As a result, private firms do not need to meet the Securities

2
https://www.cermati.com/artikel/perusahaan-publik

3
Wisnu, Perusahaan terbatas swasta, Jurnal ISSN : 2620-4959 (online), 2620-3715 Volume
1, No. 1, April 2018, h 9
 and Exchange Commission's (SEC) strict filing requirements for public

companies.

In general, the shares of these businesses are less liquid, and their

valuations are more difficult to determine.

Sole proprietorships put company ownership in the hands of one

person. A sole proprietorship is not its own legal entity; its assets, liabilities

and all financial obligations fall completely onto the individual owner. While

this gives the individual total control over decisions, it also raises risk and

makes it harder to raise money. Partnerships are another type of ownership

structure for private companies; they share the unlimited liability aspect of

sole proprietorships but include at least two owners.

C. The difference between public limited companies and private limited

companies

There are two types of organizations: public and private sector-based

institutions. When an organization's shares are published and sold to the

public to keep the public as one of the shareholders, it is listed under the

public sector and then called a public company.

In contrast, private companies are handled by individuals or teams of

members of private organizations. A public company is a type of business

organization that issuesShares that can be bought and sold by the public on

the stock exchange. These companies are owned by shareholders who have

limited liability. A private company is a type of business organization owned

by a small group of people, such as founders, family members, or private

investors.4
4
Christyanto Sahoa, Analisis Perbandingan Kualitas Pelayanan Publik Antara Orgaisasi
Swasta Dan Organisasi Publik,ejournal un srat,manado, 2016, h 22
 A public company is a type of business organization that issues shares

that can be bought and sold by the public on a stock exchange. These

companies are owned by shareholders who have limited liability. A private

company is a type of business organization owned by a small group of

people, such as founders, family members, or private investors.

A sole proprietorship is an organization whose management and shares

involve a group of individual members who assume corporate responsibility.

These people are people who are part of the administration of enterprises,

founders, and a group of private capitalists. This set of capitalists is a group

of people who privately invest in the management of the organization and

run a private enterprise.5

Because it is a public organization, a public company does not have a set

range for a set number of members. The size of the organization is very large.

Private companies have only a limited number of members in their

organizations. The size of the organization is relatively smaller or depends

on the private group

Public organizations Its capital, in general, is higher than that of private

companies. Private companies have a smaller minimum capital when

compared to public companies.

Public companies do not place restrictions on the upper limit of

members in the organization. The company since held by the public uses the

word limited to represent the company. This term is used at the end of the

name of a company owned by the public. The share capital of a private

5
https://askanydifference.com/id/difference-between-public-and-private-company
 company is under the ownership of the company. In addition, there are no

restrictions in terms of Beneficial Ownership reporting obligations. 6

A. CONCLUSION

A public company is a type of business organization that issues shares

that can be bought and sold by the public on a stock exchange. These

companies are owned by shareholders who have limited liability. A private

company is a type of business organization owned by a small group of

people, such as founders, family members, or private investors.

Because it is a public organization, a public company does not have a set

range for a set number of members. The size of the organization is very

large. Private companies have only a limited number of members in their

organizations. The size of the organization is relatively smaller or depends

on the private group

Public organizations Its capital, in general, is higher than that of

private companies. Private companies have a smaller minimum capital

when compared to public companies.

B. ADVICE

That's the paper we can compile. Hopefully it can be useful for all of

us, we realize that this paper is not the final process, but is a first step that

still needs a lot of improvement. Therefore we sincerely expect

constructive feedback, suggestions and criticisms for the perfection of our

next paper. And hopefully we can study this material together and beyond.

6
Mardiasmo, “Perbandingan Manajemen Sektor Pemerintah Dengan Sektor Swasta”. June
2019, Jurnal Public Policy 2(2), h 4
Christyanto Sahoa, Analisis Perbandingan Kualitas Pelayanan Publik

Antara Orgaisasi Swasta Dan Organisasi Publik,ejournal

unsrat,manado, 2016.

https://askanydifference.com/id/difference-between-public-and-

private-company

https://www.cermati.com/artikel/perusahaan-publik

Mardiasmo, “Perbandingan Manajemen Sektor Pemerintah Dengan

Sektor Swasta”. June 2019, Jurnal Public Policy 2(2)

Sinambela, L.P dkk, 2008, Reformasi Pelayanan Publik (Teori,

Kebijakan, dan Implementasi), Jakarta :Bumi Aksara.

Wisnu, Perusahaan terbatas swasta, Jurnal ISSN : 2620-4959

(online), 2620-3715 Volume 1, No. 1, April 2018