How to incorporate a One Person Company?

The concept of One Person Company [OPC] is a new vehicle/form of business, which was introduced by The Companies Act, 2013 [No.18 of 2013], thereby enabling the Entrepreneur(s) to carry on the business in the Sole-Proprietor to form of business to enter into a Corporate Framework.

One Person Company is thus a hybrid of a Sole-Proprietor and a Company form of business, and it has been provided with the concessional/relaxed requirements under the Act.

This article will tell about the steps which are to be followed to incorporate a one-person company.

Only one shareholder:

1. Features of One Person Company (OPC)

Only a natural person, who is an Indian citizen and a resident in India shall thus be eligible to incorporate a One Person Company.

2. Nominee for the shareholder:

The Shareholder shall thus nominate another person who would become the shareholders in case of death/incapacity of the original shareholder.  Such nominee shall thus give his/her consent and such consent for being appointed as the Nominee for the sole Shareholder.   Only a natural person, who is an Indian citizen and a  resident in India shall thus be considered to be a nominee for the sole member of a One Person Company.

3. Director :

The company is required to have a minimum of One Director, the Sole Shareholder can thus himself be the Sole Director. The Company may, however, have a maximum number of 15 directors.

Steps to be followed to Incorporate One Person Company (OPC)

1. The director is firstly required to obtain a  Digital Signature Certificate [DSC] for the proposed Director(s).
2. He is then required to obtain a Director Identification Number [DIN] for the proposed director(s).
3. Thirdly, they are supposed to select a suitable Company Name and then make an application to the Ministry of Corporate Office for the availability of name.
4. The fourth step is to Draft a Memorandum of Association and the Articles of Association [MOA & AOA].
5. The fifth requirement is to sign and file various documents of the One Person Company including MOA & AOA with the Registrar of Companies electronically.
6. The director is required to pay the requisite fee to the Ministry of Corporate Affairs and also as  Stamp Duty.
7. The seventh step is to scrutinize the documents at the Registrar of Companies [ROC].
8. Lastly, he is required to obtain the receipt of Certificate of Registration/Incorporation from ROC.

Related Article–

What are the advantages of OPC Registration? 

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