Friday, July 19, 2024

A Business and A Company: Are they the same?

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By: Juliana Twumwaa Obeng

The Writer

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A Business and A Company: Are they the same?

The terms “business” and “company” are often used interchangeably. However, they do have different legal meanings and implications. In this article, we will explore the differences between a business and a company, and how these concepts apply to the context of The Gambia.

A business can be defined as an organization or individual engaged in commercial, industrial, or professional activities. This can include sole proprietorships, partnerships, or corporations. In general, a business is any entity that seeks to earn a profit by providing goods or services to consumers.

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On the other hand, a company is a legal entity that is separate and distinct from its owners. It can be created by filing the necessary paperwork with the appropriate government agency, such as the Companies House in The Gambia. A company can issue stock, own property, enter into contracts, and sue or be sued in its own name. A company can also be either for-profit or non-profit.

Legal Framework

In The Gambia, companies are governed by the Companies Act of 2013. This law provides for the formation, management, and dissolution of companies, and outlines the duties and responsibilities of company directors and shareholders. There are several types of companies recognized under Gambian law, including private companies, public companies, and limited liability companies.

A private company is one that is owned by a small group of individuals, and whose shares are not publicly traded. A public company, on the other hand, is one whose shares are publicly traded on a stock exchange. A limited liability company, or LLC, is a hybrid form of company that combines the benefits of a partnership with the limited liability protection of a corporation. It is worth noting that while all companies are businesses, not all businesses are companies. For example, a sole proprietorship is a type of business that is owned and operated by a single individual and is not a separate legal entity from its owner.

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One important distinction between a business and a company is that a company has limited liability protection for its owners or shareholders. This means that the personal assets of the owners or shareholders are protected in the event that the company is sued or goes bankrupt. In contrast, sole proprietors and partners in a partnership are personally liable for any debts or legal actions taken against the business.

In The Gambia, limited liability companies is a popular form of business structure for entrepreneurs and investors. This is because they provide the benefits of limited liability protection, while also offering flexibility in management and taxation. A limited liability company can be owned by one or more individuals or entities, and the liability of the owners is limited to the amount of their investment in the company.

Another important consideration for businesses operating in The Gambia is the regulatory environment. The Gambia has a relatively business-friendly regulatory framework, with a relatively low tax rate, streamlined registration procedures, and a favourable investment climate. However, like any country, there are unique legal and regulatory requirements that businesses must comply with, such as obtaining business licenses and registering with the appropriate government agencies.

In terms of industries, The Gambia has a diverse economy that includes agriculture, tourism, manufacturing, and services. The government has identified several priority sectors for development, including energy, infrastructure, and information and communication technology.

Parting Words

While there are legal and regulatory distinctions between a business and a company, both concepts are important for entrepreneurs and investors looking to establish a presence in The Gambia or other jurisdictions around the world. Understanding the unique opportunities and challenges of the Gambian business environment can help businesses navigate the regulatory landscape and build successful enterprises.

The writer is a BL candidate at the Gambia Law School. She is driven by her affinity to the legal profession and relies on Precedents and Acts of the National Assembly to educate the public on bits and pieces of the application of the Laws of the Gambia and the Ethics of the legal profession. These write-ups are for educational purposes only and not to serve as a substitute for Legal Advice. Email: [email protected] 

 REFERENCES:

  1. The Companies Act, 2013. (n.d.).https://www.attorneygeneral.gov.gm/wp-content/uploads/2016/09/The-Companies-Act-2013.pdf
  2. Gaye, A. (2020). Small Business Opportunities in The Gambia: Challenges and Prospects. International Journal of Business and Management, 15(10), 181-190.
  3. The Gambia Chamber of Commerce and Industry. (n.d.). Retrieved from https://www.gambcci.gm/
  4. United Nations Development Programme. (2021). The Gambia: Country Profile. Retrieved from http://hdr.undp.org/en/countries/profiles/GMB
  5. World Bank Group. (2021). The Gambia. https://www.worldbank.org/en/country/gambia
  6. Njie, L. (2021, January 18). Business Regulations in The Gambia: What Investors Should Know. African Exponent. Retrieved from https://www.africanexponent.com/post/8335-business-regulations-in-the-gambia-what-investors-should-know

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