DEFINITION of 'Yugen Kaisha - YK'

A type of limited liability company that could be established in Japan from 1940 through early 2006. The Companies Act enacted in Japan in June 2005 abolished the YK business form. The law changed most YKs into KKs, or kabushiki kaisha, a joint stock company and the most common business form in Japan. The corporation law also changed the corporate governance of YKs.

BREAKING DOWN 'Yugen Kaisha - YK'

The YK was based on the German GmbH, a limited liability company and the most common form of corporation in Germany. Japan's YK structure was commonly used by small businesses and could have a maximum of 50 investors.

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