The purpose of this paper is to propose joint stock company with variable capital (JSCVC), as financial sharing funds and banks necessitate that their capital and number of shareholders be instantaneously variable. Legal personality and accounts clearing of this type of corporations are different from conventional companies.
JSCVC is a corporation in which capital and shares of shareholders vary by new entrance or withdrawal of shareholders at any point of time.
Interest rate-based calculations were removed and Rastin Sharing Accounting was applied for JSCVS. Shareholders of JSCVC share the company’s nominal capital proportional to nominal values of their shares. Financial outcome of JSCVC is proportional to values of shares weighted by shares duration of participation.
To prevent spoiling of shareholders’ rights, legal procedure of issuing shares for JSCVC should be defined in compliance with domestic commerce laws in any country.
JSCVC can be used by majority of investment funds, credit unions, saving and loan associations, pension and provident funds, thrift saving plans as well as Islamic banks and financial sharing activities. In JSCVC, deposit at a bank is treated as a share of the company (bank).
JSCVC has fair profit distribution and accounts clearing arrangements.
Different variable capital companies have been defined in many countries’ laws, but essential modifications are presented in JSCVC definition to regulate financial sharing arrangements and bank’s performances.
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