What is the legal framework of organisation in the private sector?


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Frances Bott Profile
Frances Bott answered
There are a bunch of different legal frameworks for different types of private sector companies. For example, a LLC (limited liability corporation) will have different rules and regulations, which relate to liability and taxation. A big corporation will have its own set of rules, which may change, based on country, if the corporation is international. Within the rules and stipulations of each business type, there will be different legal guidelines that should be followed. All of these will be laid out in government outlines and contracts.

• Information to consider

How a person gathers the information they need about private sector legal frameworks will depend on which country they live in. For example, in Canada, a person wishing to legally incorporate should visit the Government of Canada's official website to collect more data. In the USA or UK, Americans and those living in the British Isles should visit their own country's official government websites. Each government website will list detailed legal frameworks and guidelines for different types of organizations.

• Guidelines vary widely

Whether a person wants to form a non-profit or for-profit organization will affect the legal framework that must be adhered to. Each type of business organization will be subject to different taxation rules, reporting guidelines, and legal frameworks. A non-profit agency will need to prove to the government that it is using charity funds properly, and this will be achieved through regular reportage of income. A for-profit corporation will need to declare all income and assets (and liabilities) to the government, and it may choose to acquire assets under the business name, or under a principal in the company's own name. What type of company is formed will dictate the legal framework that should be used.

Learning more about the legal framework of organizations starts with getting information from the federal government, and it can continue by consulting with an attorney who specializes in corporate law or incorporation. There are pitfalls and pros to each type of business - a lawyer or experienced business mentor can be excellent sounding boards before the process begins.

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