Public Limited Company
A firm owned by shareholders and directors is a public limited company. The general public may purchase shares from it. A public limited company, also indexed on the stock market, must provide more information than a private corporation. A PLC must also fulfil additional requirements due to being publicly traded, such as other tax administration and publishing financial reports, so prospective shareholders have all the information they require before investing.
Features of Public Limited Company
Its main features are:
- The people who make up the corporation are not parties to the firm's legal existence.
- Rules, laws, and regulations govern every aspect of its creation, operation, and dissolution.
- The minimum number of members required for public Ltd. Company registration is 7, but there is no prescribed maximum limit.
- The company raises capital through the sale of its shares. The sum like this amassed is referred to as the share capital. The shareholders who purchase the company's shares are referred to as members.
- The transfer of a company's shares is permissible without the previous approval of other shareholders or further notice to the business.
- A company member's responsibility is only up to the face value of the shares owned by him. He is under no obligation to contribute anything to the company's creditors once he has paid the full face value of the note.
- Shareholders of a public Ltd. company do not have the right to participate in the day-to-day business activities. The Board of Directors has the capacity to take decisions on behalf of the corporation, and it follows the majority rule when deciding on any policy. It provides reassurance that management is making the same progress. It ensures that control and ownership remain distinct.
Advantages and Disadvantages of Public Limited Company Registration
Because the benefits of this new legal form exceed the drawbacks, businesses elect to establish themselves as public limited companies. Going public has several significant benefits, but the shift also necessitates considerable management structure modifications.
Advantages of a public limited company registration
- The public Ltd. company can raise capital by selling its shares.
- This money can also be used for the growth and expansion of business.
- With this capital, the company can pay off its Debt.
- Publicity raises awareness of a brand.
- The reputation and status of a public limited company might rise through listing on the stock market.
- With the help of public records, making business partners is much easier.
- A feeling of openness might build a feeling of trust in customers for a brand.
Disadvantages of Public limited company registration
- A Public Ltd. Company must have two directors, but an Ltd only requires one.
- More regulations exist for Companies House and taxes.
- Public corporations have shorter HMRC tax deadlines.
- A PLC's company secretary must be fully qualified, unlike company secretaries for Ltd.
- Any buyer can become a shareholder, clouding the company's shared goal.
- Lack of secrecy since power has been distributed more widely as there are more stockholders.
Documents required for a public limited company registration
- Identity proof, including a driver's licence, an Aadhaar card, a passport, and a voter ID
- Electricity, water, and rent utility bills
- You need to submit the utility bill for the registered office address proof.
- Shareholders address
- Digital Signature certificate
- Directors Identification Number
- Memorandum of Association (MoA) & Article of Association (AOA)
Process for Public Limited Company Registration
The Public limited company registration procedure is almost the same as private limited company registration. You must follow the processes listed below for a public limited company registration online:
Complete the form:
Online submission of the public Ltd. company registration application form is required. It needs to be done via the relevant MCA portal, and the necessary documents are to be submitted.
Applying for DSC and DIN:
The applicant must apply for a Director Identification Number and Digital Signature Certificate. For electronic processing documents, the digital signature certificate would guarantee authenticity. In addition, the DSC supports using electronic signatures under the act's criteria. The company might hire a minimum number of directors to fulfil the requirements of a public limited company by applying for a DIN.
Verification of the name of the company:
According to the Ministry of Corporate Affairs' regulations, the company's name is reviewed and verified (MCA). The firm name cannot be interchangeable with any other name. In addition, the company's name must not violate the Indian intellectual property law.
Filling out the SPICe Form:
The applicant would file the SPICe form to obtain the certificate of incorporation once the appropriate authorities had approved the name of the public limited company. The company's director will be assigned the DIN number after the applicant submits the SPICe form.
Submission of Documents:
After completing the abovementioned stages, the applicant must submit the documents to the MCA. The articles of organisation and the memorandum of association are among the documents that must be filed with the appropriate authorities. The business must also include supporting paperwork, such as its mission statement, long-term goals, and objectives.
Incorporating the Company:
After verifying the process, the MCA and Registrar of Companies will provide the certificate of establishment for the public limited company. This certificate serves as a proof-of-status legal document for the public limited company.
Opening a Bank Account:
The last stage involves opening a public limited company's bank account. It's important to distinguish this bank account from opening a personal account. It must be open to doing daily business on behalf of the organisation.
Contact a lawgical India specialist for additional details regarding Public Limited Company registration in India. You may get the best guidance on any business-related issue from our professionals.
