ARMENIA Law and Practice Contributed by: Hayk Hovhannisyan and Suren Sloyan, HAP
HAP 4/3 Adonts street Yeraz business centre 3rd floor Yerevan Armenia Tel: +374 9140 3605 Email: hayk.hovhannisyan@hap.am Web: www.hap.am
1. Introductory 1.1 Forms of Corporate/Business Organisations
Closed JSC (CJSC) In CJSCs, shares are distributed among a lim - ited number of shareholders and are not freely traded. They are suitable for large businesses seeking investment. Co-Operatives Co-operatives can be formed by individuals with shared economic interests. They are typically used in agriculture, housing and small-scale production. Individual Entrepreneur (IE) An Ie, is a business which is owned and oper - ated by one individual. In an Ie, the owner has full control but also unlimited personal liability for debts. There is simplified registration and tax treatment for IEs. This structure is ideal for new businesses because of its straightforward man - agement and operational simplicity. Contract of Joint Activity Without Forming a Legal Entity IEs and/or commercial organisations and/or citi - zens engaged in agricultural production can pool their resources and act jointly without establish - ing a separate legal entity for the purpose of making a profit or achieving other lawful objec - tives.
Businesses may operate in various organisation - al and legal forms in Armenia. The organisational and legal form is chosen taking factors such the scope of liability, the number of participants and the applicable tax regime into account. The main forms of corporate and business organisation in Armenia include the following. Limited Liability Company (LLC) An LLC is the most common and flexible busi - ness structure. Under this structure, sharehold - ers are only liable to the extent of their contribu - tions to the charter capital. There is no minimum charter capital requirement and this form of organisation is suitable for small and medium- sized enterprises (SMEs). Joint Stock Company (JSC) JSCs can be open or closed. Open JSC (OJSC) In OJSCs, shares are freely transferable and can be publicly traded.
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