Question

Describe the legal position of a sole proprietor.

Answer 1

The legal positions of a sole proprietor are as follows:

1. There is no legal restriction on the setting up of a sole proprietorship.
2. There is no specific law under which a sole proprietorship requires registration.
3. In some cases, e.g., to open a wine shop, a licence is required.
4. A sole proprietorship is subject to the country’s general laws.
5. Sole proprietorship has no separate legal entity independent of its owner.
6. The liability of a sole proprietor is limited.