One Person Company: Companies Act, 2013

Admin
March 03, 2023

A One Person Company (OPC) is a business structure that is registered under the Companies Act, 2013, and allows for a single person to start and manage a company. Here is a comprehensive guide to the Companies Act, 2013, as it pertains to OPCs, including their subsections and document requirements:

  1. Minimum Requirements: To form an OPC, you need to have only one director and one shareholder. The director and shareholder can be the same person.

  2. Name Reservation: The process of name reservation for an OPC is the same as that for other types of companies.

  3. Incorporation: The incorporation process for an OPC is similar to that for other types of companies, with some additional requirements. The promoter of an OPC must nominate a person who will become the director of the company in the event of the promoter's death or incapacity. This person is called a nominee director.

  4. Memorandum and Articles of Association: The memorandum and articles of association of an OPC are similar to those of other types of companies.

  5. Authorized and Paid-up Capital: There is no minimum authorized or paid-up capital requirement for an OPC.

  6. Annual Compliance: The annual compliance requirements for an OPC are similar to those for other types of companies.

  7. Meetings: An OPC is required to hold at least one board meeting each year.

  8. Shares and Shareholders: An OPC can issue only equity shares to its shareholder. The shares can be freely transferred, subject to any restrictions mentioned in the Articles of Association. The shareholder has limited liability, meaning that their liability is limited to the amount of their investment in the company.

  9. Director: The director of an OPC must be a natural person and a resident of India. The nominee director can be any person, whether a resident or non-resident of India.

  10. Sub-sections: The Companies Act, 2013, provides for two sub-sections of OPCs: one with paid-up share capital up to Rs. 50 lakhs and turnover up to Rs. 2 crores, and the other with paid-up share capital above Rs. 50 lakhs and turnover above Rs. 2 crores.

  11. Document Requirements: The documents required for the registration of an OPC include the memorandum and articles of association, a declaration by the nominee director, and the identity and address proof of the director and shareholder.

In conclusion, the Companies Act, 2013, lays down the legal framework for OPCs in India. The Act provides for the incorporation, management, and compliance of OPCs, and ensures that they comply with the regulatory requirements. As an OPC, it is essential to comply with the provisions of the Act to avoid penalties and legal liabilities. The document requirements for the registration of an OPC must be fulfilled, and the annual compliance requirements must be met to ensure smooth functioning of the company.