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Glite Dictionary
close corporation

close corporation

7.3
A company that a small group of people own and run and whose shares are not sold to the public
  • noun
  • /kloʊs ˌkɔːrpəˈreɪʃən/
  • South African
translation icon : sociedad cerrada
  • Many small businesses operate as a close corporation to maintain control over their operations and ownership.

Examples

  • "The impact of ordinary business decisions is felt more directly and disproportionately in a close corporation than in a public corporation."

    Academic text (2017)

  • One example of these difficulties is the close corporation where different lawyers represent separate stockholder interests, and one of the lawyers also represents the corporation.

    Academic text (2005)

  • In a close corporation, shareholders can make decisions quickly without the need for public shareholder meetings.

  • The close corporation was formed to keep control of the company within the founding family.

Synonyms

private corporation
vsclose corporation
  • Specialized
8 3.7

A company owned by a small group whose shares are not sold to the public

is specifically defined as nonpublic and limited to few owners
closed corporation
vsclose corporation
  • Specialized
7.0

A company whose shares are owned by a small group and not sold to the public

has identical meaning but uses a different phrase form
closely held corporation
vsclose corporation
  • Specialized
6.8

A company owned by a small group whose shares are not sold on the stock market

focuses on small ownership without stressing sale intentions
privately held corporation
vsclose corporation
5.4

A company owned by a few people whose shares are not sold on public stock markets

expresses the small owner and nonpublic share idea without naming exchanges

Surface Forms

close corporation singular
close corporations plural

Morphology

close + corporation

The phrase is partially compositional: combining 'close' in the sense of 'not open/limited' with 'corporation' suggests a company that is restricted or not open to the public, so a learner who knows both words can often guess it refers to restricted ownership. However, the precise legal sense (shares not publicly traded; small number of shareholders) is domain-specific and may not be fully predictable to an average B1 learner, so it is not fully transparent.

Etymology

Close corporation comes from the idea of a company kept close, or 'closed' to the public. Imagine a small group of owners standing close together and not letting outsiders buy shares. That's why it means a company owned by a few people and not open to the public.