Can a company be state-run and publicly traded at the same time?

By Katie Adams AAA
A:

A state-run company or enterprise cannot be publicly traded in the U.S. However, it is possible to purchase shares of state-run companies in some foreign countries, like China and India. According to the Administrative Law of State-Run Enterprise, a state-run company is defined as:



  • An enterprise that is solely owned by the state; or
  • An enterprise which, in accordance with special regulations, is jointly owned by the state and private individuals; or
  • An enterprise which, in accordance with company law, is jointly owned by the State and private individuals where the state holds more than 50% of capital.

State-run enterprises may, with the approval of the government, issue corporate bonds. In addition, enterprises can issue stocks, but shares must be placed under the custody of the national treasury. State-run enterprises are required to turn over their profits to the national treasury following annual audits. (For further reading, check out State-Run Economies: From Public To Private.)



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