Unit 33 Forms of Business Organization in the USA Read the text page 151 and complete the following table FORM OF Owner(s) / Control over Resposibility / Other BUSINESS Way of the business / liability features ORGANIZ. founding profit Sole proprietorships Partnerships Corporations Compare SOLE TRGOVAC POJEDINAC PROPRIETORSHIP PARTNERSHIP TRGOVAČKO DRUŠTVO (društva osoba) a) general p. a) javno trgovačko društvo b) limited p. b) komanditno društvo CORPORATION* TRGOVAČKO DRUŠTVO (društva kapitala) a) C-corporation a) dioničko društvo d.d. (AG) b) S-corporation b) d.o.o. (GmbH) *Uniform Commercial Code (S-section / C-section) Zakon o trgovačkim društvima - ZTD Study the following collocations. Turn nominal phrases into verbal phrases. 1. formation of a business → to form a business 2. possibilities of growth and expansion 3. financial responsibility 4. responsibility for the losses, debts, etc. 5. association of two or more persons as co-owners 6. voluntary agreement of partners 7. equal profit sharing 8. combination and utilization of labour, capital, etc. 9. transferability of shares 10. professional management of a corporation a) Find the nouns that collocate with the following verbs. b) Which of the 3 forms of business organization does each of them refer to? c) Write sentence examples. 1. to enjoy... 2. to incur... 3. to share... 4. to utilize... 5. to carry on... Find the words of opposite meaning – antonyms. 1. a retail store 2. individual ownership 3. full liability 4. an artificial person KEY – antonyms. 1. a retail store ≠ wholesale (veletrgovina) 2. individual ownership ≠ partnership (trgovačko društvo) 3. full liability ≠ limited liability (ograničena odgovornost) 4. an artificial / legal / juristic person ≠ natural person (fizička osoba) Read the following definition of a company and compare it with the definition of a corporation in your book, p. 151 A company* is a business association which has the character of a legal person, distinct from its officers and shareholders. This is significant, as it allows the company to own property in its own name, continue perpetually despite changes in ownership, and insulate the owners against personal liability. However, in some instances, for example when the company is used to perpetrate fraud..., the court may “lift the corporate veil” and subject the shareholders to personal liability. * company = corporation in the USA Make notes which will help you explain to an American business partner how Croatian Commercial Code (ZTD) defines the term: Javno trgovačko društvo Pojam javnoga trgovačkoga društva – Članaka 68 (1) Javno trgovačko društvo je trgovačko društvo u koje se udružuju dvije ili više osoba zbog trajnog obavljanja djelatnosti pod zajedničkom tvrtkom, a svaki član društva odgovara vjerovnicima društva neograničeno solidarno cijelom svojom imovinom. (2) Član društva može biti svaka fizička ili pravna osoba. Answer the following questions. 1. Which forms of business organizations are there in the USA? 2. Which criteria are normally taken into consideration when people consider formation of a new business? (5 criteria) 3. Which are the examples of businesses that function as sole proprietorships? 4. What are the adventages and disadventages of sole proprietorship? 5. What is the main precondition for establishing a partnership? Questions – PART 2 6. What kind of equality is the basis for the functioning of a partnership? 7. What is the way to create a corporation? 8. What is the position of corporations in the USA considering the size or volume of business being done? 9. What are the main attributes of a corporation? 10. Which Croatian forms of business organizations are you familiar with?