Public Limited Company Registration
In India, Public Limited Company registration can be a desirable option for all individuals who aim to gain capital through investment and the prestige associated with a publicly traded company.
According to the regulations of India, to form a Public Limited Company Registration, the minimum number of shareholders should be seven, and the minimum number of directors should be three. For a private company to be incorporated, it must have an authorized capital of not less than INR 500000 (5 Lacs)., directors need to enshrine Digital Signature Certificates (DSC) and apply for Director Identification Numbers (DINs), followed by filing appropriate forms with the Registrar of Companies.
This article, brought to you by Blacktie Legal Services India LLP, provides a detailed understanding of every aspect of a Public Limited Company, including its legal structure, benefits, requirements, process, and everything.
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What is a Public Limited Company?
A public limited company registration is a type of business structure that has the legal right to issue its shares to the public. It operates based on the Companies Act, 2013, and has features such as minimum paid-up capital, limited liability of shareholders, and many more legal compliances and disclosures than a private limited company.
Advantages of Public Limited Company
By registering a Public Limited Company, a person gets all the benefits that we have mentioned below:
- Access to capital: The issue of shares to the public by a new public limited company can mobilize a huge amount of capital through an IPO.
- Limited Liability: The liability of shareholders is limited up to the amount unpaid for the shares they hold; thus, personal assets cannot be used by the business.
- Perpetual Succession: The company exists beyond ownership, thereby creating a more stable business environment that is more conducive to good performance.
- Transferability of Shares: Corporate shares are quoted in the stock market and therefore, easy to sell in the market compared to mutuals.
- Enhanced Credibility: To some extent, being a public limited company adds more credibility to the company and can help in attracting new investors/clients and business partners.
- Expansion Opportunities: Public limited companies have more access to even more capital and thus can exploit growth and expansion opportunities.
Requirements of Registering Public Limited Company
To Public Limited Company registration, it is very crucial for you to pass many criteria, which we have mentioned below:
- Minimum Shareholders: To establish a public company, it is essential that there should be partnerships of a minimum of 7 shareholders.
- Minimum of Directors: Keep in mind that 3 directors can form this (PLC)but one of them must be a citizen of India.
- Minimum Capital: No amount of capital has been finalized to register a public limited company but it should be in sufficient amount to meet the overall operating needs of a business.
- DIN and DSC: The team directors of the company must acquire a director identification number (DIN) and Digital Signature Certificate to sign all the documents.
- Unique Name: It is very important that the proposed name of the company is unique and should not be relevant to the trademark of any other company.
- Registered Office: The company needs to be registered within India so that any kind of official communication can be sent and received.
Step-by-Step Procedure to Registered a Public Limited Company
There are many steps involved in the procedure of public limited company registration, which we have written below:
Obtain a Digital Signature Certificate (DSC)
The overall process of Public Limited Company Registration requires DSC to be signed by the directors on all the electronic documents and to obtain it; you have to approach any of the certified agencies with the help of your identity and address proof.
Apply for Director Identification Number
A Director Identification Number (DIN) is a unique identification number for an individual director of a company. To achieve this you have to file form DIR – 3 with the Ministry of Corporate Affairs (MCA) portal.
Name Reservation
The name of the proposed company should be very unique and that name should follow all the guidelines in a very good way. To fill out the name reservation application, you can submit it on the MCA portal using SPICe+, after that whenever approval is given, the name is completely reserved for 20 days after its approval.
Drafting of MOA and AOA
The Memorandum of Association (MOA) and Articles of Association (AOA) can be used to define all the objectives, rules, and regulations of the public limited company registration, and remember that all these documents should be formed and signed by the promoters.
Filing SPICe+ Form
The documents submitted to MCA are filed in SPICe+ form which contains various details of the company, directors, shareholders, and its registered address. Apart from this, other forms like AGILE-PRO, MoA, and AoA are also filed through the special form of SPICe+.
Payment of Fees
These registration fees must be paid online, and the amount depends on the MCA. They must be paid alongside the submission of the SPICe+ form.
Certificate of Incorporation
The Registrar of Companies (ROC) on confirmation of the documents awards the Certificate of Incorporation confirming the legal existence of the company. The existence of the company is also assigned to a Corporate Identity Number (CIN).
Post - Incorporation Compliance
Once the public limited company registration, it must adhere to several compliance requirements:
- Commencement of Business: Submit a declaration for the formation of business within six months for incorporation.
- Appointment of Auditor: Register a statutory auditor for the company within one month of incorporation.
- Conducting Board Meetings: Convene the first board meeting within one month of incorporation and the other meetings as required by the company’s act.
- Issuance of Share Certificates: Deliver the share certificates to the shareholders within two months of the issues of the shares.
- Statutory Registers and Records: Keep company records of shareholders and directors as specified in the statutes in addition to the charge register.
- Filing Annual Returns: Submit annual returns and financial statements to the MCA before the due dates as provided by the law.
- Compliance with SEBI Regulations: If the company aims to have shares in a stock exchange, it will be under the rules and regulations of SEBI.
Conclusion
Public company registration within India is a structured process that involves compliance with legal requirements. The benefits of access to capital, limited liability, and increased reliability make it an attractive option for businesses aiming to grow and expand.
Blacktie Legal Services India LLP can provide you with all the issues related to Public Limited Company Registration and specific guidance during its process. Which assures a seamless experience for aspiring entrepreneurs and businesses.
Whether you are starting a new venture or transitioning from a private limited company, it is important to understand the intricacies of public limited company registration for success in the corporate world.
What Blacktie Legal Services India LLP offering in Public Company Registration?
Blacktie Legal Services India LLP, as a legal firm specializing in corporate and commercial law, can offer comprehensive services for public company registration in India. Some of our specific services may provide below services included:
- Consultation and Advisory Services: Expert advice on the process of forming a public company, including regulatory requirements, compliance obligations, and strategic considerations.
- Drafting and Reviewing Legal Documents: Preparation of all necessary legal documents such as memorandum and articles of association, prospectuses, offering documents, and shareholder agreements. They ensure these documents comply with Indian company law and regulatory frameworks.
- Due Diligence and Compliance: Conducting thorough due diligence to verify the accuracy and completeness of information provided in registration documents. Ensuring compliance with Securities and Exchange Board of India (SEBI) regulations, stock exchange listing requirements (if applicable), and other statutory obligations.
- Regulatory Filings and Approvals: Managing the preparation and submission of filings with regulatory authorities, including the Registrar of Companies (RoC), SEBI, and stock exchanges. This includes filing of prospectuses, offer documents, and other required disclosures.
- Corporate Governance Setup: Advising on and assisting in setting up effective corporate governance structures, board compositions, committees, and internal policies to comply with corporate governance norms and enhance transparency.
- Shareholder Relations and Meetings: Facilitating shareholder communications, annual general meetings (AGMs), extraordinary general meetings (EGMs), and resolutions. Handling legal aspects related to shareholder rights and obligations.
- Post-Registration Compliance: Providing ongoing support to ensure continuous compliance with regulatory requirements post-registration. This includes updating corporate records, filings, and disclosures as per statutory timelines.
- Corporate Transactions and Restructuring: Assisting in corporate transactions such as mergers, acquisitions, joint ventures, and restructuring involving public companies. This includes obtaining regulatory approvals and shareholder consents as required.
- Dispute Resolution and Litigation: Handling legal disputes, regulatory investigations, and litigation matters that may arise post-registration, protecting the interests of the public company and its stakeholders.
- Training and Workshops: Conduct training sessions and workshops for directors, officers, and employees on corporate governance, compliance, and regulatory changes affecting public companies.
Overall, Our Firm Blacktie Legal Services India LLP would provide tailored legal solutions to guide companies through the complexities of public company registration, ensuring legal compliance, protecting shareholder interests, and facilitating smooth operations in the Indian corporate landscape.
“Hope this article finds you well. Powered by Blacktie Legal Services India LLP, we strive to provide comprehensive legal solutions tailored to meet your business needs.”