An OPC has very moderate compliance requirements unlike public or private limited companies. This very fact makes it the favorite corporate entity of several business establishments.
The Companies Act, 2013 is more like a Bible to entrepreneurs and business magnets, as it guides them from A to Z in setting up their business. The drafters of the Act have been quite magnanimous, as the Act encompasses provisions that suit both high pitch establishments and rudimentary undertakings like start-ups. The OPC is one such corporate entity introduced by the Act to facilitate sole entrepreneurs to commence a successful business without having to bear a never-ending list of complex compliances. Read more to get the Requirements of an OPC.
Compliances of OPC:
Despite the fact that an OPC doesn’t call for elaborate formalities, being a corporate entity, it does mandate minimal Requirements of an OPC to be followed as enumerated below.
1. Members of the Company
An OPC as the name implies can be comprised of a single shareholder only, who should
be an Indian citizen and a resident of India. Further, only a natural person can be a
shareholder and other firms or companies are prohibited from holding the post.
2. Nominee
The shareholder has to designate a nominee, who is a citizen of India, during the incorporation of the company. The nominee steps into the position of the sole member in case of death or any disability that incapacitates the sole member from entering contracts.
3. Director
Although an OPC can have only a single shareholder, there is no limitation placed on the
number of directors an OPC can have. The directors thus elected must hold a Director
Identification Number (DIN) mandatorily.
4. Name of the Company
The name of the company should mention the words “Private Limited” and end with the words OPC. The name thus decided upon shall be subject to the approval of the Registrar.
5. Registered Office Address
Prior to the registration of the OPC, a temporary address, say the address of one of the directors can be given for any official communication. Once the OPC is registered, the official business address is to be furnished with the Registrar along with the proofs to substantiate the same.
6. Objects of the Company
The Memorandum of Association (MoA) and the Articles of Association (AoA) of the OPC have to be written out and submitted to the Registrar. It is pertinent to note that the objects of the company should be legal and should not be harming moral principles.
7. Digital Signature Certificate (DSC)
The documents required to be furnished for the incorporation of OPC are required to be signed digitally and submitted to the Registrar. A Digital Signature Certificate is therefore mandatory to verify the authenticity of the documents to be thus submitted.
8. Meetings to be Conducted
The company has to hold a minimum of two board meetings one in each half of the calendar year with a gap of 90 days between both. An OPC has an exemption in the case of Annual General Meetings as it is not mandatory to be held as in the case of board meetings.
9. Maintenance of Records
An OPC is expected to maintain all the mandatory statutory registers, minutes book, and other secretarial records as stipulated by the Act.
10. Appointment of Auditor
Like any other corporate structure, an OPC has to appoint an auditor within 30 days from the date of incorporation of the company.
Registration of OPC
Registration is mandatory and know that along with the requirements of an OPC.
Step 1
The first step is to apply for DSC with the required documents like Aadhar Card, PAN (Permanent Account Number), Aadhar Card, etc
Step 2
An Application for DIN (Director Identification Number) is to be made, which is mandatory for the directors of the OPC.
Step 3
The name of the company must be approved by the Ministry of Corporate Affairs (MCA).
Step 4
The following are mandatory for incorporating an OPC
- The MoA and AoA
- A nominee for the company selected by the member
- Consent of the nominee through the form INC 3
- Address Proof of the registered office
- Declaration and Consent of the Directors.
Step 5
All the required forms and documents are uploaded to the MCA portal with the director’s DSC.
Step 6
After having the forms and documents verified, the Registrar of Companies (ROC) will award the certificate of incorporation along with the PAN and TAN (Tax Deduction Account Number).
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