are a class of corporation

Corporation

A corporation is created under the laws of a state as a separate legal entity that has privileges and liabilities that are distinct from those of its members. There are many different forms of corporations, most of which are used to conduct business. Early corporations were established by charter...

s under Japanese law

Japanese law

-Historical Developments:Pre-Modern History The early law of Japan was heavily influenced by Chinese law. Little is known about Japanese law prior to the seventh century, when the Ritsuryō was developed and codified. Before Chinese characters were transplanted and adopted by the Japanese, the...

. While mochibun kaisha have legal personality as corporations, their internal functions are similar to partnership

Partnership

A partnership is an arrangement where parties agree to cooperate to advance their mutual interests.Since humans are social beings, partnerships between individuals, businesses, interest-based organizations, schools, governments, and varied combinations thereof, have always been and remain commonplace...

s, as they are both owned and operated by a single group of .

Types

There are three types of mochibun kaisha:

• Gōmei gaisha
  Gōmei gaisha
  In a gō-mei gaisha , all partners are jointly and severally liable for any liability incurred by the partnership, similar to an unlimited partnership. The partners¹ liability is unlimited, and creditors can go after each partner¹s personal assets if the assets of the partnership are insufficient to...
  
  , in which all members have unlimited liability for the company's debts (similar to a general partnership
  General partnership
  In the commercial and legal parlance of most countries, a general partnership or simply a partnership, refers to an association of persons or an unincorporated company with the following major features:...
  
  )
• Gōshi gaisha
  Gōshi gaisha
  Go-shi Gaisha is a Japanese concept of a "unlimited liability" company, but the structure is like as the limited partnership. Unlike the other business types there is no limit on what a company is legally responsible for. Consequently, under the Japanese system this also means there is a nominal...
  
  , in which some members have unlimited liability and some have limited liability
  Limited liability
  Limited liability is a concept where by a person's financial liability is limited to a fixed sum, most commonly the value of a person's investment in a company or partnership with limited liability. If a company with limited liability is sued, then the plaintiffs are suing the company, not its...
  
   (similar to a limited partnership
  Limited partnership
  A limited partnership is a form of partnership similar to a general partnership, except that in addition to one or more general partners , there are one or more limited partners . It is a partnership in which only one partner is required to be a general partner.The GPs are, in all major respects,...
  
  )
• Gōdō gaisha, in which all members have limited liability (very similar to a U.S. limited liability company
  Limited liability company
  A limited liability company is a flexible form of enterprise that blends elements of partnership and corporate structures. It is a legal form of company that provides limited liability to its owners in the vast majority of United States jurisdictions...
  
  )

Mochibun kaisha are formed by preparing articles of incorporation and depositing the articles with a local Legal Affairs Bureau.

The Japanese civil code also provides for , a different type of business organization. Civil code partnerships lack legal personality and are mainly used for specialized investment purposes.