What are the legal characteristics of a sole proprietorship?

Sole proprietorship has the following legal characteristics:

1. The enterprise is invested and established by a natural person. A sole proprietorship enterprise is unique in terms of investment entities, which is the basic attribute that distinguishes it from multiple investment entities such as partnerships and companies.

2. The property of the enterprise is owned by the investor. The investor of a sole proprietorship is the sole owner of the property of the enterprise, including the initial capital contribution invested by the investor at the time of the establishment of the enterprise and the property accumulated during the existence of the enterprise.

3. The investor bears unlimited liability for the debts of the enterprise with his personal property. The debts of a sole proprietorship are equal to the personal debts of the investor, and the investor is liable for the debts with all his personal property and not only with the property invested in the enterprise, that is, he bears unlimited liability.

4. Established in accordance with the Sole Proprietorship Act. Sole proprietorship enterprises must be established in accordance with the Sole Proprietorship Law of the People's Republic of China.

5 Sole proprietorship must be established in China. The domicile of a sole proprietorship should be in China, and it must be established in China and obtain Chinese nationality in accordance with the law.

6 Sole proprietorship does not have legal personality. A sole proprietorship is an economic entity, which belongs to a form of enterprise, has an enterprise name or trade name, has a fixed production and operation site and necessary production and operation conditions, has the necessary funds and employees, and engages in business activities and participates in litigation activities in the name of the enterprise, and does not have an independent legal person status, but is only a special form of commercial activities carried out by natural persons.

Only one natural person invests in the establishment of the enterprise, the property is owned by the investor, the investor bears unlimited liability for the debts of the enterprise, the internal organization of the sole proprietorship enterprise is simple, and the operation and management mode is flexible.

Legal analysis: A sole proprietorship has the following legal characteristics: the enterprise is invested and established by a natural person.

A sole proprietorship is unique in terms of investment entities, which is a basic attribute that distinguishes it from multiple investment entities such as partnerships and companies. The property of the enterprise is owned by the individual investor. The investor has unlimited liability for the debts of the enterprise with his personal property.

The debts of a sole proprietorship are equal to the personal debts of the investor, and the investor is liable for the debts with all his personal property and not only with the property invested in the enterprise, that is, he bears unlimited liability. Established under the Sole Proprietorship Act. Sole proprietorship enterprises must be established in accordance with the Sole Proprietorship Law of the People's Republic of China.

Legal basis: Article 2 of the Law of the People's Republic of China on Sole Proprietorship Enterprises: The term "sole proprietorship enterprise" as used in this Law refers to a business entity established in China in accordance with this Law, invested by a natural person, whose property is owned by the investor, and whose personal property bears unlimited liability for the debts of the enterprise.

Article 3: A sole proprietorship enterprise shall be domiciled at the place where its main office is located.

Article 4: Sole proprietorship enterprises engaged in business activities must abide by laws and administrative regulations, abide by the principle of good faith, and must not harm the public interest.

Legal Analysis: (1) The investor of a sole proprietorship is a natural person. The natural person shall have full capacity for civil conduct and must not be a person prohibited by laws or administrative regulations from engaging in for-profit activities.

2) The property of the sole proprietorship is owned by the investor. The enterprise property here includes not only the initial property invested by the investor when the enterprise is established, but also the property accumulated during the existence of the enterprise. The investor is the sole legal owner of the sole proprietorship's property.

3. The investor bears unlimited liability for the debts of the enterprise with his personal property. This is an important feature of a sole proprietorship. In other words, when the capital contribution declared and registered by the investor is insufficient to pay off the debts incurred by the sole proprietorship enterprise, the investor must use his personal property or even family property to pay off the debts.

4) Sole proprietorship does not have legal personality. Although a sole proprietorship can be named, and can be used externally, it is only a special form of business activities carried out by natural persons, which belongs to the category of natural person enterprises.

Legal basis: Law of the People's Republic of China on Sole Proprietorship Enterprises

Article 8 The establishment of a sole proprietorship enterprise shall meet the following conditions:

1) The investor is a natural person;

2) Have a legal business name;

3) Capital contributions declared by investors;

4) There are fixed production and business premises and necessary production and operation conditions;

5) Have the necessary practitioners.

Article 9 To apply for the establishment of a sole proprietorship enterprise, the investor or the person entrusted by the investor shall submit the application for establishment, the investor's identity certificate, the certificate of use of the production and business premises and other documents to the registration authority where the sole proprietorship enterprise is located. When the entrusting person applies for establishment registration, the power of attorney of the investor and the legal certificate of the person shall be issued.

Sole proprietorship enterprises shall not engage in business prohibited by laws and administrative regulations; Those engaged in business that laws and administrative regulations provide must be reported to the relevant departments for examination and approval, and the approval documents of the relevant departments shall be submitted when applying for establishment and registration.

Article 10 The application for the establishment of a sole proprietorship enterprise shall contain the following matters:

1) The name and domicile of the enterprise;

2) the name and residence of the investor;

3) the amount and method of capital contribution of the investor;

4) Scope of business.

Article 11 The name of a sole proprietorship enterprise shall be consistent with the form of its responsibility and the business it engages in.

A sole proprietorship enterprise refers to a business entity established in China in accordance with the law, invested by a natural person, whose property is owned by the investor, and whose personal property bears unlimited liability for the debts of the enterprise.

The legal characteristics of a sole proprietorship are:

1. A sole proprietorship is invested by a natural person. A natural person shall be a person with full capacity for civil conduct, and shall not be a person who is prohibited by laws and administrative regulations from engaging in for-profit activities as provided for in Article 16 of the Law"; At the same time, this provision of course excludes the qualification of a legal person as an investor in a sole proprietorship.

2. The property invested by the investor in the enterprise is owned by the investor. The possession of private property by private individuals is a development of article 13, paragraph 1, of the Constitution, which states that "the State shall protect the ownership of citizens' lawful income, savings, houses and other legal property", and clearly reflects the attitude of the State towards private property and confirms the legal status of private property.

3. The investor bears unlimited liability for the debts of the enterprise with his personal property. This is an important feature of a sole proprietorship, when the investor's declared and registered capital contribution is insufficient to pay off the debts incurred by the sole proprietorship, the investor must use his personal property or even family property to pay off the debts.

4. A sole proprietorship is not an independent corporate legal person, but only a business entity. One of the characteristics of a legal person is that it bears limited liability independently of the property of the legal person, while the investor of a sole proprietorship bears unlimited liability externally, and of course it cannot be an independent corporate legal person.