Currently, the company has slightly changed its appearance and name. Now, two types are distinguished: public and non-public joint-stock companies. However, first things first.
Shareholder Society
There are such forms of ownership: IP, LLC, OJSC, CJSC. Of all these communities, it will be a closed joint-stock company - CJSC. What is this organization? CJSC is understood as a business association that has its own authorized capital divided into a number of shares. By shares is meant a security or any document that vests its owner with property rights in a closed joint-stock company that issued this share. It is important to understand that all shareholders, that is, shareholders, are not responsible for the debts of the company. The risk of these people lies only in the value of their shares, which can fluctuate depending on the successes or failures of the entire community.
Previously, there were two types of AO - this is OJSC and CJSC. The ratio of a joint-stock company to one of these types is determined by the number of shareholders that are members of it. CJSC - a form of ownership, which is determined by a small number of shareholders. From a legal point of view, the division into open and closed companies occurs with an increase in the number of shareholders. If there are more than a certain number of them, then the community is required to re-register in open from closed.
CJSC from the legal side
A closed joint-stock company whose form of ownership has certain characteristics may be expressed by the following provisions:
- The redistribution of shares of such a community can only occur within it or between the circle of people who have been previously entered into the documents and officially approved. There can be no more than fifty such people.
- The law prohibits an open subscription to the shares of such joint-stock companies.
- The ownership form of the company assumes that when selling or buying shares in such a company, the shareholders of the same community or a pre-determined circle of people have priority rights to them.
As you can understand, in a closed joint-stock company there is no free purchase or sale of shares. The entire exchange of securities occurs only within a strictly defined circle of persons. In addition, if new securities are issued, then their sale will also be possible only within this circle. A closed joint-stock company is a form of ownership that is free from the annual publication of the results of its activities. Such communities publish any reports only if they are necessary to comply with the law within the state where the organization operates.
CJSC structure
It is worth mentioning that the structure of a closed joint-stock company, the form of ownership of which is determined by the closed type, is quite simple and is built on several people. In such a community, the governing body is a meeting of shareholders. That is, they are those people who have a certain percentage of shares in this community. The number of people included in the meeting of shareholders should also not be more than 50 people. If this limit is exceeded, then the CJSC must create a supervisory board that will monitor the activities of shareholders. However, this is not all; there is another governing body.
We considered the structure of the company, the form of ownership. What other power is present in such an organization? In addition to the meeting of shareholders, the company operates the so-called executive branch, which manages, for example, a company owned by shareholders.Such control can be carried out individually, that is, by one direct director, who reports only to the meeting of shareholders or the supervisory board. In addition, management can be carried out by a board of directors, who also report only to a meeting or council.
However, there is another independent body that is present during the creation of the company. The form of ownership is private in such an organization, but each participant wants to monitor how things are going in his company. For this, an independent audit committee is created. The purpose of this body is to control internal affairs, as well as the finances of the office.
What is the essence of CJSC
It is worth starting with the fact that the difference between a closed joint stock company and a limited liability company is much smaller than between a closed joint stock company and a closed joint stock company. This must be remembered. This can be seen if we draw an analogy and search for differences between these communities. The difference between a closed joint-stock company and a limited liability company is only formal. The difference is that in LLC all the invested capital is called a share, but in a company it is called shares.
If a line is drawn between a closed joint-stock company and an open joint-stock company, then a significant difference will be visible, and above all, that the ownership rights to the combined capital that is invested in the organization differ. And between LLC and CJSC such differences do not exist at all.
Distinctive features of CJSC
All communities have their own distinctive features, including CJSC. The form of ownership of this meeting is determined by the following points:
- Due to the fact that the sale of shares in such a community is possible only between its participants, as well as proxies, and the circle of these persons cannot exceed 50 people, the capital of a closed joint-stock company will be much less if you compare it with an open company, for example.
- The CJSC has a rule that states that the first right to purchase shares is held by community members. Sale of securities to other parties is possible only if all shareholders have refused to purchase this package of documents. However, in order to make such a decision, it is imperative that a so-called quorum be held, at which the majority of the company's shareholders will be present.
- There is only a few ways to increase the capital of a community such as a closed joint-stock company. The first is possible additional contributions from shareholders. Also, capital may increase if the property owned by the meeting grows in value. There is a third option, which suggests that you can increase capital with the involvement of third parties, but this opportunity should be spelled out in the charter of shareholders.
- The latter is the correct and ongoing legal support and execution of all documents of a closed joint-stock company. The community needs this from its inception until liquidation.
Advantages of CJSC
Like any other organization, a company has its positive and negative sides. The first include the following:
- A simple procedure for the sale of shares between participants in a joint stock company. It does not require any registration with a state body, but is carried out in the presence of the usual purchase and sale agreement. The only record that remains is a mark in the journal of the society itself, which it keeps.
- A closed joint-stock company is best suited for those people who do not wish to reveal their identities. When registering a community, neither in the charter, nor anywhere else there is a mandatory requirement to register data on each individual member of this community.
- It is believed that being a founder of a closed joint-stock company is quite prestigious. That is why the presence of such a community in any company indicates its prestige, which is quite capable of attracting many new investments.
- The management structure for such a community is quite simple, but very effective. This is due to the fact that such a kind of community is managed by a whole collegial meeting of shareholders, and not by one person.For this reason, each of the shareholders bears an equal share of responsibility for each success or failure of the enterprise.
Disadvantages of CJSC
The disadvantages of a closed joint-stock company include the following provisions:
- The first drawback is the limited number of participants. If you exceed the limit of 50 people, you must either reorganize the meeting or dissolve it.
- Due to the fact that it takes time to create community shares, as well as to create reports on the issue, the registration of a closed joint-stock company may take a long time.
- Some problems will arise if one of the shareholders decides to leave the community. The fact is that you can transfer your own share from a closed joint-stock company only if you sell all your securities, which are analogous to cash, while the person is inside the joint-stock company.
Cancel CJSC
The form of ownership was abolished in 2014 on the territory of the Russian Federation, when the federal law of 05.05.2014 entered into force. The implementation of this law has changed a lot, including the situation of most legal entities. As mentioned earlier, this decree leaves behind organizations such as closed and open joint-stock companies. 
However, the law does not completely disband them, but only translates them into other legal fields, making them just stock meetings. Although still some differences between the former closed and open communities will remain.
Re-registration
We figured out what kind of ownership the company has. The re-registration of a closed partnership will be much more civilized than the same procedure, but with an LLC. Due to some mistakes made, the state decided not to establish the same strict time frames during which it is necessary to go through re-registration and amend the charter of an existing joint-stock company. This suggests that existing OJSC and CJSC may not change their name until there is a need to change the charter of the meeting.