A Company is a more complex legal entity whose existence is separate from its owners and managers (named the shareholders and directors respectively). Possessing a legal status, a company has rights similar to that of a living person meaning that it can incur debt, sue and be sued.
There are two main types of companies in Australia; proprietary (private) and public companies.
- The Proprietary structure is most commonly used by small businesses. A company does not sell its shares to the public and has limited liability. Proprietary limited companies are commonly denoted by the abbreviation ‘Pty Ltd’ suffix at the end of their company names.
- Public companies can sell their shares to the public and have their liability limited. Public companies are subject to onerous disclosure and compliance responsibilities because of their listing on the Australian Stock Exchange.
Source: ASIC website