Q: How does Halachah view corporations and limited liability companies (LLC)?
A: A corporation or LLC is viewed in secular law as an independent entity. The corporation or LLC remains distinct from the personal assets of its shareholders, and the liabilities do not extend to them. In this regard, it is like a partnership without personal ownership.
There is a significant dispute among the Poskim as to how Halachah views a corporation or LLC. Some maintain that Halachah also views it as a partnership without personal ownership. However, the consensus of most Poskim is that corporations and LLC are similar, in principle, to classic partnerships in which each owner has personal ownership of his share. Nonetheless, the liability of the corporation’s or LLC’s business ventures is limited to its assets based on dina d’malchusa, since everyone who deals with it does so with this understanding (see Chiddushei Seridei Esh, p. 554, in the name of Rav Shaul Weingart; Minchas Yitzchak 3:1).