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One Person Company (OPC)

April 7, 2016     by Simratjeet Kaur

What is One Person Company (OPC)?
As per Companies Act, 2013, OPC means a company which has only 1 person as a member. OPC has only 1 member as the Member cum Director and a nominee.
What is the eligibility criterion to incorporate OPC?
Only a natural person who is:

  1.  An Indian Citizen
  2.  Resident in India (stay in India is for not less than 182 days during the immediate preceding 1 calendar year)

 

Are there any restrictions on OPC?
The following restrictions are imposed on OPCs:

  1.    A person can’t form more than 1 OPC.
  2.    A nominee in 1 OPC can’t be appointed as nominee in any other OPC.
  3.    A minor cant become a member or nominee of OPC
  4.    OPC can’t be converted into a Section 8 Company.
  5.    OPC can’t carryout non Banking Financial Investment activities including investment in securities of any body corporate.
  6.    The name of company incorporated as OPC should end with Private Limited (OPC).

 

Can OPC convert to any other kind of Company?
An OPC can convert to any other kind of Company subject to the following conditions:

  1.    2 years should have elapsed from incorporation of OPC prior to its conversion,
  2.    Paid up capital of OPC is increased beyond Rs. 50,00,000.
  3.    Average turnover exceeds Rs. 2,00,00,000 for the relevant period.

 

Can OPC accept FDI?
No, FDI is not allowed for OPC. If the OPC accepts FDI then it will lose its very nature of OPC.

 

 

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