The corporate structure

What is a corporation?
A corporation is a form of organization that has a
independent existence of their owners. They can organize to
multiple purposes and corporations can be of many types.
For example, a municipal corporation is a city, a town or
county operating under a corporate figure managed by the
State. While a public corporation is owned and
administered by the government. Here we will see the structure.
corporate related to business.

Definition of corporate structure

Corporate structure refers to

how a business is organized to achieve its objectives.
The corporate structure of a business is important because
determines the ownership, control, and authority of that corporation.
These characteristics in a corporation are represented by 3 actors:
Shareholders, Board of Directors, and Directors. Ownership (the owners)
They are the shareholders. The control is executed by the board of directors in
name of the shareholders, while the authority over the
The day-to-day operations are carried out by the Directors.
The board of directors orders on behalf of the shareholders, while
they give instructions to the CEO to pass down to the executives
regarding the operability.

Shareholders
The shareholders of a corporation share ownership through
of shares. Most business corporations
they consolidate based on the objective of providing an economic benefit to their
shareholders.
Shareholders have the right to participate in the profits of
thecompany, but they are not personally liable for the debts
of the company.
This concept is known as limited liability, and it is one of
the main advantages of the corporation as a form of doing
businesses.
If you decide to invest in a couple of shares of your favorite company,
Does this give you the right as a shareholder to appear at the headquarters?
corporate and start making decisions? Generally not. Instead
from this, the shareholders elect a board of directors that
supervises the management of the corporation.

The Board of Directors

The Board of Directors is responsible for overseeing and directing the business of
the corporation with the best interest for shareholders. The key point
here is the supervision. The Board is not expected to make it operational
really the business. Rather, its purpose is to supervise the
operations, approve the major plans and monitor performance
financial.

The board generally performs the following functions:

Select, evaluate, set the compensation for, and when it is

necessary to replace the General Director of the company.
Supervise business operations to assess if the company
it is being managed properly.
Review and approve the major corporate plans, objectives
financial, the annual budgets and strategies.
Review the adequacy of financial accounting, auditing, and others
systems to comply with the applicable law.

The authority in these responsibilities typically derives from

statutes of each state that delegated to the council or board have the
obligation to manage the corporation's business.

The board does not have total control. Some important decisions that
they affect society require the voting of shareholders. The
statutes specify the topics that must be the subject of decisions of
the shareholders, including: amendments to the certificate of incorporation
or the statutes, the election of directors, the sale of all or
substantially part of the corporation's assets, and the merger or
consolidation of the corporation.
The Board of Directors (or Administrative Council) is composed of
generally of three types of people. The President, who is
technically, the leader of the corporation, responsible for
functioning of the board with efficiency. The president is elected by the
Chairman of the board of directors. The duties of the President include
maintain strong relationships and open communication with him
Director General (or CEO) and other executives, carry out the
formulation of the business strategy and the representation of the
management and the board of directors of the company for the public in
general and the shareholders.

The definition of organizational or corporate culture emphasizes the assumptions and

deep patterns of meaning, thevalues, the rules and the expectations,
philosophies, frames of reference or observable behavioral regularities
like rites, rituals, and structures (Abrahamson and Fombrun, 1974).

The term appeared casually in English literature in the 60s, as

synonym of 'climate', it is important to highlight the great influence that it has on culture
the corporate has the founder, that is, the company will reflect in it the
the personality of its creator, although over time it may become hidden due to
the changes carried out by groups or subgroups of people that
they make up the organization.

Culture is a set of key values, beliefs, and understandings that are

shared by the members of an organization according to Smircich,
1983. Pettigrew (1979) describes organizational culture as 'the system of
publicly and collectively accepted meanings operating for a group
given at a given time.

In the business world, there are three general types of

organizations: sole proprietorships, partnerships, and corporations.
While corporations are usually considered large
companies, can also include smaller organizations. The
sole proprietors and partnerships can also be incorporated if
they feel that they will obtain benefits, such as the possibility of
pay less taxes or obtain protection from creditors. The
three types of corporate structures include C corporations,
corporations S and limited liability companies.

Corporation C
A corporation C or joint-stock company in general is the type used
for large companies. C corporations raise capital
through the sale of shares, which means that the shareholders are the
owners of the company. The high executives of the corporation,
as the Chief Executive Officer, or spokesperson of the company, (CEO) and the
The president reports to a board of directors, which contributes
to determine corporate policy and direction. The corporation is
records as a separate entity and the owners of the company
They must also pay taxes on their personal income. The
companies are legally required to hold annual meetings of
shareholders and create and distribute annual reports to shareholders.

Corporation S
S corporations are used in smaller businesses. Just like
that C corporations, S corporations increase capital
through the sale of shares, even though they are limited to having a
maximum of 75 shareholders. They are also limited to the sale of one
only type of shares. The profits and losses suffered by the
Corporations S are considered as personal income or losses.
for their shareholders, and they are included when they file their taxes
about the rent. In this way, the owners avoid double
taxation of the owners of C corporations. The
S corporations may have difficulties obtaining capital due to
to the limited number of shareholders and the types of shares. Likewise
that C corporations, S corporations must also celebrate
annual shareholder meetings.

Limited liability company

Limited liability companies or LLC (for its acronym in Spanish)
are usually used by individual entrepreneurs or partnerships
that wish to merge. A great advantage of an LLC for these
smaller entities are that the owners are personally
responsible for their own investments in the corporation. The
creditors cannot file a claim on their assets
personal to fulfill a legal obligation or debt. Likewise
that an S corporation, the owners of the LLC are taxed on a
personal base to avoid double taxation. State laws
they limit the life of the LLC, with most states limiting them to
30 years. Unlike the other two legal entities, corporations
limited liability companies cannot raise capital through
sale of shares.

Sole Proprietorship
Limited Liability (EIRL)
The Individual Limited Liability Company
(EIRL) is a type of company widely used in the country, mainly
because they are companies that have a single owner and, furthermore, they
to have an independent and separate estate from others
assets owned by a person as an individual.

Main characteristics of this type of

society
Its corporate name must be followed by the word
Single Member Limited Liability Company, or the
initials 'E.I.R.L.'
Belongs to an individual.
It is an entity endowed with its own legal personality.
The contribution of its owner can be in cash or in
nature.
It is established by an act granted by its founder.
There is no minimum amount of share capital.
The attribution of the power of direction of this type of companies is
grants to a Manager who must be a natural person.
It will be able to carry out civil and commercial operations.
The owner may appoint a manager or assume the functions
of this.

Necessary requirements for the creation of a

Sole Proprietorship
Limited (E.I.R.L.)
In addition to the requirements set forth at the end of this article,
will also need:
Draft the articles of incorporation, legalized by a notary lawyer.
Pay and have the deposit receipt of the contribution, issued
by the corresponding banking entity.
Photocopy of the identity and electoral ID.

Benefits of starting a Sole Proprietorship

Limited Liability (E.I.R.L.)
It is not necessary to have a partner.
You separate your personal assets from the company's assets.
2. Simplified Joint Stock Company (SAS)
The Simplified Stock Companies (SAS) are those that are constituted with
two or more people, who will only be responsible for the amount of their contributions.

The main advantage of a Simplified Joint Stock Company (SAS) is its freedom.
contractual, through which shareholders can freely establish in the
Articles of Incorporation regarding everything pertinent to the company, as well as the rules that
they need to operate the society.

Main characteristics of this type of

society
It must have at least two partners and there is no limit on the maximum.
The company name (trade name) will be freely formed.
adding the words Simplified Stock Corporation or the initials SAS.
Its authorized capital stock shall not be less than RD$3,000,000.00.
The share capital is divided into shares.
At least 10% of the share capital must be subscribed and paid at the time.
of the formation of society.
Administrators do not necessarily have to be natural persons.
The bylaws freely determine the management structure of the
company, which can consist of one or several managers or in a
board of directors.
The appointment of one or several auditors is not mandatory.
supervise the administration management.

Requirements for the Constitution of a

Simplified Joint Stock Company (SAS)
Power of the person with the quality to represent society to the person
that processes the request for Commercial Registration.
Social statutes, in a private act (minimum 2 originals) or authentic, that
It must be deposited in the Commercial Registry.
In the case of cash subscription of shares, subscription receipt
that must be signed by the founder(s)
Original report of the contributing commissioner (if applicable), which must be an accountant.
authorized public or appraiser registered in the Appraisers Institute
Dominicans or at the Superintendency of Banks or Insurance.
Payment receipt for corporate tax (1% of capital)
authorized
Copies of identity and electoral ID (in the case of Dominicans) and
passport, foreign identity card, or other.

Benefits of the creation of a Company

Simplified Anonymous Society (SAS)

Autonomy to freely establish the rules of society.

Liability is limited.
Its creation is easy, as it can be created through a private document.
3. Limited Liability Company
Limited (LLC)
A Limited Liability Company (LLC) can be defined as one that
commercial company in which liability is limited to the capital contributed, and is
for this reason, in the event that the company incurs debts, there is no liability with the
personal assets of the partners, and it is mainly for this characteristic that this
this type of company is quite common in the country.

Characteristics of a Society of
Limited Liability (S.R.L.)
The name of the company must be preceded or followed by the
words 'Limited Liability Company', or the initials 'L.L.C.'.
It is limited to a minimum of 2 partners and a maximum of 50 partners.
The partners of the S.R.L. can be natural or legal persons.
It is always commercial.
It may conduct civil and commercial operations, except for those
reserved by law for public limited companies, for example banks and
insurance companies.
Its management corresponds to the Manager(s), who represent(s) the
S.R.L. judicially and extrajudicially, with all the powers of
administration and disposition.

Requirements for the Constitution of a

Limited Liability Company (L.L.C.)
In addition to the requirements set out at the end of this article, you will also need:

Payment of the 1% capital tax.

Drafting and signing of the incorporation documents.
Deposit of the documents in the corresponding entities.

Benefits of the creation of a Company

Limited Liability (S.R.L.)
The liability of the partners for the company's debts is limited to the
capital contributions.
The minimum capital stock is very small, as it is only RD$100,000.00.
There is no maximum capital.
There is no minimum or maximum percentage of capital for each partner.
It is allowed to establish a new identity, making it easier for one to
companies gather capital and finance themselves, compared to an individual.
In addition, there are other
societies in the country
Public Limited Company (S.A.)
The Commercial Companies Law, in article 154, defines the Corporation.
(S.A.), as the one existing between two or more people under a social name and
is composed exclusively of partners whose responsibility for losses is
limits their contributions.

Something very important to keep in mind in this type of society is that there are two
(2) types of Corporations (S.A.): Subscription Corporation
Public and Private Subscription Limited Company.

Partnership
This type of company is formed by two or more partners, who enter into an agreement.
joint liability concerning the company's commitments.
The Commercial Companies Law in Article 59 states that this type of company
is that which:

It exists under a business name and in which all partners have the
quality of merchants and they respond, subsidiarily,
unlimited and joint, of social obligations.

Some characteristics of this type of

Society is
The creditors of the company can only pursue the payment of debts.
social actions against a partner after having defaulted on the society
by extrajudicial act.
It must consist of the name of one or more partners followed by
the words "and company" or their abbreviation, if they did not appear in it
names of all partners.
It must have a minimum of two (2) partners.
The capital of this company will be set in the articles of association.
The Comptroller is not mandatory.
All partners will be managers, unless otherwise stipulated.
the statutes.
The shares or actions of this company are not transferable or assignable without the
consent of the other partners.

Simple command partnership

This company is made up of two types of partners, the general partners, with
joint liability for the company's commitments, the partners
limited partners, with liability limited to the amount of their contribution.
Partnership limited by shares
It is the one in which one or more limited partners are jointly liable.
for social obligations and one or more limited partners have the
limited liability to the amount of the shares they have subscribed to, in the same
way that the shareholders of a stock company.
In this type of society, the share capital will be divided into shares. And the number of
the limited partners shall not be less than three (3).