ABSTRACT
The sole trader may be able to overcome the lack of adequate funds to develop the business, and non-sharing of responsibility for running the business by forming a partnership. This relationship is described by the Partnership Act 1890 as ‘existing between persons who carry on business in common with a view to profit’. The process of forming a company is referred to as incorporation. This is a very significant legal step, because the business then becomes known in law as a corporation. Historically, all companies had an objects clause. This clause sets out exactly what business the company can engage in. Traditionally, these clauses have been very long, with the draftsman attempting to cover every possible activity which a company may wish to undertake. A company can sometimes improve its financial position by siting itself where it may benefit from central and local government grants and loans. The schemes will vary from time to time, reflecting the political stance of the government of the day.
