There may be many forms of business organisations that may be classified as profit-oriented organisations and non-profit organisations. In a developing economy there are certain sectors where the form of organisation should aim at regulating the civic life of the society.

This is to ensure the uninterrupted supply of certain indispensable goods and services to the society in general. For e.g.: electricity, water, gas, transport, telephone, railways, postal services, sewerage facilities etc.

The participation of private sector in such organisations may affect the needs of certain levels of people of the country. Further, private sector participation may bring about the existence of competition in the supply of these essentials of life. Competition leads to variations in the nature of services offered, which may dislocate the harmony of organised life in the society.

As a result, the Government, Central or State, restricts the entry of the private sector in such key areas in the interest of the society in general. The public utility concerns therefore are organised as monopolies, under the direct control of a public authority.

ADVERTISEMENTS:

Definition of a Public Utility Concern:

A public utility concern can be defined as, “The form of business organisation established under state control, organised to arrange for the efficient and uninterrupted supply of very essential goods and services in uniform manner as they are absolutely indispensable for the civilised community”.

– Prof. J. Raj an

In the words of Dr. K. Aswathappa, “Public Utility or Utilities may be defined as an enterprise that sell a product or render a service which is considered to be a necessity”.