In Latin America, companies are classified as capital companies, partnerships, and mixed companies.
Capital companies or joint-stock company ( joint-stock company ): In this, the social obligations are guaranteed by a certain capital and the partners are only obliged to respond for the amount of their share, so when canceling the amount of their share or shareholding package disclaims responsibility for the obligations of the company that could exceed this contribution.
From partnership or company to collective name ( collective partnership): In this, social obligations are guaranteed by the unlimited and joint liability of all partners. This means that all partners have the duty to meet all the obligations of the company, therefore if a partner were unable to respond due to lack of money or other reasons, the other partners would assume the commitment. This system is in disuse due to the high level of risk that each partner has to face all the obligations of the company, so if one division of the company does a bad business and bankruptcy drags all the others, even without having anything to see in the process. Originally, it was viable because it was based on family properties and each one of the members of the families with a high ethical and moral value responded jointly and severally for the obligations contracted.
Mixed partnership or limited partnership ( limited partnership ): The two modalities are grouped here, with partners whose social responsibility is limited to a certain sum and others, called joint or general partners, each of whom is responsible for the total of the obligations of the company.
Limited liability company ( limited liability company ): Here, social obligations are guaranteed by a certain capital divided into participation quotas. It differs from companies in that they are not easily transferable since the shares cannot be represented in shares or negotiable securities.