Business law topic 3 Flashcards
What characterizes a partnership in comparison to capital companies?
a) The members take responsibility with their personal assets for the obligations of the company.
b) The company’s management is not a separate corporate body.
c) Partnerships cannot engage in commercial activities.
d) Only capital companies can have more than one member.
Answer: a) The members take responsibility with their personal assets for the obligations of the company.
Explanation: In partnerships, unlike capital companies, members are personally and unlimitedly liable for the debts of the business, reflecting a key difference in the liability regime.
Which of the following statements about the legal personality of commercial companies is true?
a) Only partnerships have legal personality once registered.
b) The entrepreneur for legal purposes is the company, not its members.
c) Capital companies do not have legal personality.
d) Legal personality is automatically granted upon business creation.
Answer: b) The entrepreneur for legal purposes is the company, not its members.
Explanation: A fundamental principle of commercial law is that the company itself is recognized as the legal entrepreneur, separate from its individual members, which allows it to own assets, incur liabilities, and enter into contracts in its own name.
Which requirement is necessary for all commercial companies?
a) All members must be directors.
b) The company must engage in international trade.
c) Obligation to register the company in the Commercial Register (“Registro Mercantil”).
d) A minimum capital contribution is required for partnerships.
Answer: c) Obligation to register the company in the Commercial Register (“Registro Mercantil”).
Explanation: Registration in the Commercial Register is a legal requirement for all commercial companies. This serves as a public record of the company’s legal status, its directors, capital, and other significant details, providing legal certainty to economic operators.
What distinguishes a ‘Sociedad Anónima’ (Public Limited Company) from other types of business entities?
a) It is a partnership with unlimited member liability.
b) Its capital is divided into stakes.
c) Members are not personally liable for company debts.
d) It requires the name of at least one member in the company name.
Answer: c) Members are not personally liable for company debts.
Explanation: In a ‘Sociedad Anónima,’ the capital is divided into shares, and members (shareholders) are not personally liable for the debts of the company, distinguishing it from partnerships where members have unlimited personal liability.
How is the capital of a ‘Sociedad de Responsabilidad Limitada’ (Private Limited Company) structured?
a) Divided into shares, with member liability extending to personal assets.
b) Divided into stakes, with members not personally liable for company debts.
c) Composed solely of the personal contributions of the members.
d) There is no capital; members contribute services instead.
Answer: b) Divided into stakes, with members not personally liable for company debts.
Explanation: In a ‘Sociedad de Responsabilidad Limitada,’ the company’s capital is divided into stakes. Members contribute capital but are not personally liable for the company’s debts, aligning with the structure of capital companies where liability is limited to the amount contributed.
Which of the following is a determining factor in choosing the legal form of a business activity?
a) The geographical location of the business.
b) Regulation of responsibility and necessary capital.
c) The age of the business owners.
d) The business’s marketing strategy.
Answer: b) Regulation of responsibility and necessary capital.
Explanation: When deciding on the legal form of a business, key considerations include the regulatory framework governing the responsibilities of the business owners and the amount of capital required. This decision impacts the liability, management structure, and potential growth of the business.
