What is a federal corporation?
Federal corporation is an entity created by the US Congress to carry out public service. Congress creates a federal corporation by approval of the law that defines the size, purpose, structure and authority of the subject. Examples of federal corporations are the American Postal Service, the National Railroad Passenger Corporation (Amtrak) and the Federal Society of Deposit (FDIC).
Numerous countries establish corporations through legislative enactment. However, the term federal corporation seems unique to American various other countries that create corporations using terms such as statutory corporations, Crown Corporation, government ownership corporations or state corporations that describe government corporations.
The US does not have a general status of incorporation. As a result, the characteristics of the federal corporation differ greatly, because the congress must adopt a separate law for each of them. For example, Congress may require corporate -over the revenue of the services and products it provides to the public.This helps to eliminate or minimize the need to subsidize entities with taxpayers' money. Congress does not necessarily require all federal corporations to generate revenue.
This kind of corporation may exist permanently, while another may dissolve if a specific goal is met. For example, Congress can create a corporation that would help switch the federal agency to a private entity. After fulfilling its purpose, it dissolves.
The advantage of establishing a federal corporation is to minimize the management policy and objectives of the business entity. Congress can set up the Board of Directors for Corporation Management. However, this does not insulate the corporation from politics just because the Congress can provide supervision through Congress Committees and the appointment of directors.
government sponsoThe Redovní enterprise (GSE) differs from the federal corporation. GSE is similar to federal corporation because Congress creates it through legislation. The government also regulates GSE. GSE is private and its purpose is to make money for its owners. Fannie Mae, a financial institution, is an example of GSE.
The US Constitution limits the actions of the federal corporation because it remains a government agency. He is obliged to perform a government office established by law. Although the entity is partially owned by private individuals or private entities, it is not able to escape constitutional restrictions.