Difference between entrepreneurs and companies

Company Law (Official Gazette, Republic of Serbia, No. 125/2004) defines a company (enterprise as it was called before introduction of the mentioned Law, and it is still used in everyday speech) as a legal entity which is founded by legal entities and/or natural persons by Articles of Association for the purpose of conducting activities with the aim of gaining profit.  The company can be established in the following legal forms: general partnership, limited partnership, limited liability company and joint stock company (open and closed). In addition to the legal forms of companies, specific other laws may prescribe other forms of companies or enterprises.

Entrepreneur (i.e., business, as this form of activity is often referred) in term of the Company Law is a natural person who is registered and conducts with the aim to gain profit all lawful activities, including art, ort crafts and traditional handicrafts. Entrepreneur performs activities under his/her own name or the name of other person or under a specific business name in compliance with the Company Law. The name is registered with the addition to the name "entrepreneur" or abbreviation "pr". An important difference between an entrepreneur and company is that the company is legal entity, while entrepreneur is still natural person which means that entrepreneur is liable for all obligations with his/her assets. In terms of liability, property used by natural person in performing activities is inseparable from his personal (private) property.

On the other hand, regarding the legal form, liability of companies is differently defined. General partnership is liable for its obligations with all its property; partners are jointly and severally liable for all obligations of the company with all their property, unless it is agreed otherwise with the creditor. Regarding the legal form, limited partnership is very similar to general partnership; it is, in terms of Company Law, a company founded by two or more natural persons and/or legal entities acting as partners, in order to perform certain activities, under common business name, of whom at least one person has unlimited liability for the obligations of the company (fully liable partner), and at least one person has limited liability up to the amount of agreed investment (limited partner) A limited liability company is liable for its obligations with all property, while a member of a limited liability company is not liable for obligation of the company, except up to the amount of investment into the property of company. In practice, a limited liability company is the most frequent form that is being registered, partly because of the limited liability that members (founders) have. Shareholders of the joint stock company are not liable for the obligations of the company, except up too the amount of agreed but unpaid investment into the property of the company (in accordance with the Company Law).