The addition of the word "limited" to the name of a company is a common form in the modern corporate system. Before we can see why we should add the word "limited" to the company name, we first need to understand the meaning of the word "limited".
The word "limited" means "limited, bounded" in Chinese. Adding "limited" to the name of the company means that the existence and operation of the company is restricted by law. Specifically, it shows that the company is a separate legal entity whose rights and responsibilities are limited and cannot be extended indefinitely.
In the modern company system, the main reasons for adding the word "limited" are as follows:
1.Indicate the independence of the company: The addition of "limited" can clearly indicate the independent legal status of the company. Unlike a sole trader or individual, a company is a separate legal entity with specific rights and obligations under the law.
2.Emphasis on limited liability: The addition of "limited" to the name of the company indicates that the liability of the shareholders or promoters of the company is limited. They are only liable for the shares they hold, and not for the entire debt of the company. This limited liability is one of the important features of the modern corporate system.
3.Emphasizing that the company is legally bound: The name of the company plus "limited" emphasizes that the company must comply with relevant laws and regulations and accept the supervision of ** regulators. The company's operations and actions must comply with legal requirements or face legal liability.
4.It is easy to distinguish between different types of companies: in Chinese, "limited" corresponds to "unlimited". Adding "limited" to the company name can clearly distinguish between different types of companies. For example, shares *** with unlimited liability companies, etc.
In short, the addition of the word "limited" to the name of the company is to clarify the company's independent legal personality, limited liability, legal constraints and other characteristics, and to facilitate the distinction between different types of companies. This naming method helps to maintain market order and protect the interests of investors.