Public Limited Company
A Public Limited Company (PLC), as defined under the Companies Act, 2013, is a type of company that is allowed to offer shares to the general public. It is distinguished by limited liability, meaning the liability of its shareholders is restricted to the amount unpaid on their shares.
A Public Limited Company can raise capital by offering its shares to the public through an Initial Public Offering (IPO) or by listing its shares on a stock exchange. This allows anyone to acquire shares of the company. Public limited companies are required to comply with stringent regulatory norms, including regular financial disclosures, to ensure transparency and protect the interests of shareholders.
Suitability & Popularity
Public Limited Companies are ideal for medium to large-sized businesses that seek to raise equity capital from the public. Due to their ability to access a wide pool of investors, they are one of the most popular business structures for medium and large enterprises in India.
Characteristics of a Public Limited Company
1. Directors
A public limited company must have a minimum of three directors as per the provisions of the Companies Act, 2013. These directors play an essential role in managing the company’s operations and ensuring compliance with regulations.
2. Paid-up Capital
There is no minimum capital requirement for forming a Public Limited Company. This allows flexibility in raising funds and expanding the company.
3. Prospectus
A public limited company is required to issue a prospectus that provides detailed information about its business, financial status, and future plans. This is done to give potential investors clear insight into the company’s operations and financial health.
4. Name
As mandated by the Companies Act, 2013, the name of a public limited company must always end with the word “Limited” to distinguish it from other business structures.
5. Limited Liability
The hallmark feature of a Public Limited Company is limited liability, meaning that the liability of its shareholders is restricted to the amount unpaid on their shares. This limits the risk for shareholders, making it an attractive option for investors.
These characteristics make Public Limited Companies an ideal structure for larger businesses aiming to raise capital from the public while offering limited liability protection to their shareholders.
Process of Public Limited Company Registration India
Step 1: Name Reservation
The first step is to apply for Name Reservation using the SPICe+ web service on the Ministry of Corporate Affairs (MCA) website.
Ensure that the desired name is available and does not conflict with any existing trademarks.
The name reservation can be done using Part A of the SPICe+ form.
Step 2: Fill Part B of SPICe+
The next step is to fill Part B of SPICe+ to proceed with the registration, which allows modifications to be saved before final submission.
Step 3: Convert SPICe+ Form into PDF
Convert the SPICe+ form into a PDF and affix the Digital Signature Certificate (DSC).
Step 4: Upload the Form on MCA Portal
Upload the signed form on the MCA portal for further processing.
Step 5: Declaration of Company’s Directors and Subscribers
The declaration for the Subscribers and Directors (Form INC-9) will be generated in PDF format and submitted electronically.
Recent Amendments and Changes
Key Requirements :
1. No SRN Mention Needed
The SRN (Service Request Number) is no longer required when reserving a name in Part A. It will be automatically generated when filing Part B.
2. Mandatory Registration for ESIC and EPFO
ESIC and EPFO registrations are now mandatory for all newly incorporated companies as of February 23, 2020.
3. Professional Tax Registration for Maharashtra
Professional Tax Registration is now mandatory for new companies incorporated in Maharashtra.
4. Mandatory Bank Account Application
Companies must now file an application to open a bank account through the AGILE-PRO web form during incorporation.
5. Mandatory Use of e-MoA (INC-33) and e-AoA (INC-34)
e-MoA and e-AoA forms must be used in some cases (e.g., up to 7 subscribers and certain conditions regarding nationality and directors).
6 . Signed Physical Copies of MoA/AoA
In certain cases, apostille or signed physical copies of MoA and AoA must be submitted if certain conditions are met (such as non-Indian subscribers or foreign nationals without a business visa).
7 . Filing Statutory Returns
New companies registered through SPICe+ must file statutory returns only if the prescribed threshold limit for EPFO/ESI has been exceeded.