A Public Limited Company is a company that has limited liability and offers shares to the general public. Basically, it is an incorporated business that is a separate legal entity from its owners and whose shares can be freely traded and sold to the public. According to the Companies Act, 2013, ‘public company’ means a company that is not a private company aka which:
- does not reserve the rights to its shares and
- does not limit the number of its members to fifty.
There are many benefits to incorporating a public limited company in India. These include ease of issuing shares to the public, no fund limitations, more business growth chances, and one of the safest sources of capital that is not needed to repay the debts incurred. The public funds by a public company can be used to expand its business growth and also towards the business’s obligations and management. Now let’s see what requirements you need to fulfil if you?re interested in the registration of a public limited company.
Requirements for registering a public limited company
The Companies Act, 2013 has prescribed various rules and compliances regarding the formation of a public limited company. Let us have a look at some of them.
- The number of minimum shareholders required to form a public limited company is seven, whereas the minimum number of directors required to create a public limited company is 3.
- There has a minimum initial share capital of INR 5 lakhs.
- While submitting a self-attested copy of identity and address proof, Digital Signature Certificate (DSC) of one of the directors is needed.
- Director Identification Number (DIN) will be needed for each director of the proposed company.
- For the name of the company, the applicant should check the eligibility criteria and file an application with the Ministry of Corporate Affairs.
- An application has to be submitted to the Registrar of Companies (ROC) along with the required documents like Memorandum of Association (MOA), Articles of Association (AOA), and others.
- Payment of the registration fees is to be done to the Registrar of Companies (ROC).
Step 1: Digital Signature Certificate (DSC)
There should be a Digital Signature Certificate (DSC) of any one of the company’s Directors. It has to be submitted as proof of identification with physical address proof of the company.
This digital signature is required for filing the forms on the Ministry of Corporate Affairs (MCA) portal. DSC is compulsory for all proposed directors mentioned in the memorandum and articles of association.
Step 2: Director Identification Number (DIN)
Anyone who intends to be a director of the company needs to have the Director Identification Number (DIN). It is also to be submitted during the registration of a company. DIN has to be mentioned in the registration form of the company.
Step 3: Registering with the Ministry of Corporate Affairs
On the MCA portal, a complete SPICe+ form needs to be submitted in order to apply for company registration. A company director has to register on the MCA portal and fill the SPICe+ form and submit the required documents. After the registration, the director will have access to the MCA portal services to file e-forms and view public documents.
Step 4: Certificate of Incorporation
Once the application of registration is submitted along with all the required documents, the documents will be inspected by the Registrar of Companies (ROC). After the application is inspected and verified, the ROC will issue the Incorporation certificate.
Incorporating a public limited company requires following several rules and regulations. It also requires many documents like proof of address and identity of all the directors, an NOC from the land owner/landlord, DSC, DIN, MOA, AOA as well as the PAN number of all the shareholders and directors of the company. It is an intense process, and while this article gives a basic idea, it is advisable to contact a professional before registering.