Everything you want to know about One Person Company
Introduced in companies’ act 2013 [No.18 of 2013], One Person Company [OPC] is a new concept in India.Earlier in Companies act 1956 at least two directors and shareholders were required to form a company.
In OPC only one person is needed to form a company. The one person can act as a shareholder and a director. Thus we call it One Person Company. The One Person Company can be understood as a hybrid of Sole-Proprietor and Company. The OPC has minimum and /relaxed requirements under the Act.
How to Incorporate OPC
1. The first step is to get the Digital Signature Certificate [DSC] of the Director(s).
2. The next step is to get the Director Identification Number [DIN] of the proposed director(s).
3. After selection of suitable company name an application is made to the Ministry of Corporate Office to
check for availability of name.
4. A Draft Memorandum of Association and Articles of Association [MOA & AOA] is prepared in relation to
5. The director of the OPC must sign and file documents like MOA & AOA with the Registrar of Companies electronically.
6. After submission the director of OPC must pay the Requisite fee to Ministry of Corporate Affairs and Stamp Duty.
8. After proper scrutiny the ROC will send a receipt of Certificate of Registration/ Incorporation to the directors of OPC.
Benefits of OPC& Rules of OPC
The introduction of OPC concept is beneficial for many sole proprietors and entrepreneurs in India. They can easily form the companies without a second person and enter into corporate framework.
OPC should not be confused with sole proprietorship. In OPC the liability is limited to the assets of the business. In single proprietorship the business and the owner are single entity and creditors can acquire personal assets of the owner in case of default.