Under CO, which statement is true about the three types of companies?

• A. Private company, Public company and Guarantee company
• B. Private company and Public company only
• C. Guarantee company only
• D. All of the above

Answer: (B)

Under the CO, classifications of companies are based on whether they have share capital and how shares can be transferred. The two recognized forms are private company and public company, each with its own rules about share transfers, number of members, and whether the public can subscribe for shares. A company limited by guarantee is a way to structure a non-profit organisation without share capital, but it is not treated as a separate third type of company in the standard CO classification. So the idea that there are three distinct types, including a standalone guarantee company, isn’t correct. The true statement is that the two main forms are private and public companies.