Public Limited Company Registration Services
Considering registering a public limited company? Let us go through the guide below on how to incorporate a public limited company, and also know how we can help you register it, smoothly and effectively.
A Public Limited Company (plc) is the best fit for you if you have a large-scale business in India. Normally public limited companies are registered under the Companies Act 2013 which provides your company with various benefits. As a public limited company, you can list your company's shares on the stock exchange to raise capital from the public. And these stocks can be easily accessed by the public either through Initial Public Offering (IPO) or through trades on stock exchanges.
By registering your large-scale business as a public limited company you get more visibility and credibility and also get access to a broader investor base. Opting to register your business as a public limited company opens up a lot of opportunities for your business by the potential of the public market and fueling the expansion plans. Now let’s look at more details regarding registering a business as a public limited company in India.
Advantages of Public Limited Company
Registering your business as a public limited company brings in a lot of features that help your business to function on a larger scale and get hold of greater opportunities. This corporate structure, expressed by its capability to offer shares to the public provides the business with growth and improved financial capabilities.
Here are a few advantages of registering your company as a Public Limited Company in India. Let's take a look at them.
Raising capital through the public issue of shares
The most outstanding benefit lies in the ability to raise the necessary capital through Initial Public Offerings (IPOs) and the stock exchange.
Other finance opportunities
Beyond equity financing, the enhanced credibility and visibility with PLC status can help in securing other forms of finance.
Growth & expansion opportunities
The mixture of capital and expanded financing options creates a good ground for increased growth and expansion.
Shares are more easily transferable
The liquidity of shares in a PLC provides its shareholders with flexibility and ease of exit.
Higher talent acquisition and retention
Public Limited Companies attract top talent with competitive share-based incentives, boosting employee loyalty and motivation.
Improved Business Continuity
A PLC enjoys continuous succession, meaning it can outlast the involvement or lifespan of individual members.
Our Services
Here are the list of services we handle professionally to ensure a seamless and compliant registration of your Public Limited Company.
- Drafting the prospectus or Statement in Lieu of Prospectus, outlining the company's goals, operations, and investment opportunities.
- Ensuring the appointment of at least 3 directors and 7 shareholders, with necessary consent forms and declarations.
- Meeting the minimum paid-up capital requirement of ₹5 lakhs or more, as mandated for Public Limited Companies.
- Structuring authorized share capital and preparing documentation for initial share subscriptions among shareholders.
- Conducting the first board meeting to approve incorporation documents, appoint directors and auditors, and authorize filing with the MCA.
- Preparing and issuing share certificates to initial subscribers in compliance with the Companies Act, 2013.
- Opening a company bank account to deposit the initial paid-up capital, serving as proof for incorporation compliance.
- Complying with SEBI regulations for companies planning to list on a stock exchange, including drafting listing agreements and disclosures.
- Registering with additional authorities like EPFO, ESIC, or obtaining trade licences based on business requirements.
- Appointing key managerial personnel (KMPs) such as a Company Secretary, Chief Financial Officer, and Managing Director, along with preparing their engagement contracts.
How can Benchmark help you!
We at Benchmark understand the challenges and opportunities associated with this corporate structure, and process associated with registering a public limited company. Our team of professionals have in-depth knowledge of regulatory rules, ensuring your public limited company registration process follows all the statutory requirements.
From preparing the essential documents for PLC registration to guiding you through the details of the PLC registration process, we provide you with end-end service.
Documents Required for Registration
Here is the list of documents you need to register your business as a public limited company in India.
Documents related to directors & shareholders
- Proof of Identity & Address:
- PAN card,
- Aadhar card,
- Voter ID,
- Passport, or
- Driving Licence
- Passport-sized photographs
- Director Identification Number (DIN)
- Digital Signature Certificate (DSC)
Documents related to the registered office
Proof of Registered Office Address: This includes a recent utility bill (not older than two months) in the name of the owner of the premises, along with a No Objection Certificate (NOC) from the owner permitting the use of the premises as the registered office of the company.
Statutory forms and declarations
- Simplified Proforma for Incorporating Company electronically (SPICe -INC-32): This is the primary form used for incorporating a company, along with:
- eMoA (INC-33): Electronic Memorandum of Association outlining the company's objectives and powers.
- eAOA (INC-34): Electronic Articles of Association defining the company's internal rules and regulations.
- Declaration by a Professional (INC-9): A declaration by a practising professional (Chartered Accountant, Company Secretary, or Cost Accountant) certifying compliance with all legal requirements.
- DIR-2:: Consent to act as a director from each proposed director.
Registration Process for Public Limited Company
The formation of a Public Limited Company in India entails a systematic approach, ensuring compliance with regulatory rules and optimising efficiency. Here is a terse, step-by-step guide to understanding the registration process:
Obtain DSCs and DIN
All proposed directors must acquire a valid Digital Signature Certificates (DSC) and Director Identification Number (DIN) through the Ministry of Corporate Affairs portal.
Name Approval from the MCA
Submit an application to the Ministry of Corporate Affairs (MCA) for reserving the company's name through the RUN (Reserve Unique Name) or SPICe+ service.
Prepare Incorporation Documents
Draft and notarize essential documents, such as the Memorandum of Association (MoA) and Articles of Association (AoA), aligning with the company's goals and regulatory requirements.
Application Filing through SPICe+ Portal
Use the SPICe+ form (INC-32) for seamless filing of incorporation details, combining multiple services such as name reservation, DIN, and PAN/TAN application.
Verification by the Registrar of Companies (RoC)
The RoC examines submitted documents and forms for accuracy and compliance with the Companies Act, 2013.
Obtain the Certificate of Incorporation
Once approved, receive the Certificate of Incorporation from the RoC, officially establishing the company's legal identity.
Allotment of Corporate Identity Number (CIN)
Upon incorporation, the company is issued a unique Corporate Identity Number (CIN) for all official registrations and dealings.
Post-Incorporation Compliance Setup
Set up statutory registers, such as the Register of Members, and record the issuance of share certificates in accordance with the Companies Act.
Tax Registrations and Bank Account Setup
Apply for PAN, TAN - and for GST registration, if applicable, while also setting up a dedicated corporate bank account to manage financial transactions.
Convening the First Board Meeting
Conduct the first official board meeting to formalize the appointment of directors, auditors, and key managerial personnel, and to adopt statutory policies.
Post-registration Compliance
The successful incorporation of a Public Limited Company is just the beginning of its journey. There are a lot of ongoing compliance obligations to be fulfilled on the way, ensuring adherence to regulatory standards and building transparency. These requirements are integral to maintaining the company's legal standing and increasing stakeholder confidence.
- PLCs must file annual returns with the Registrar of Companies (RoC), detailing their financial performance, shareholding patterns, and other essential information.
- Audited financial statements, prepared as per Indian Accounting Standards (Ind AS), must be presented to shareholders at the AGM and filed with the RoC.
- PLCs must maintain effective communication with shareholders, providing timely updates on material developments and ensuring transparency in decision-making.
- PLCs must comply with SEBI Listing Obligations and Disclosure Requirements (LODR) regulations, encompassing corporate governance norms, insider trading prohibitions, and timely disclosures of price-sensitive information.
Challenges of Public Limited Company
While the advantages of operating as a Public Limited Company are fascinating, it's important to accept the unique challenges this structure presents, particularly in the Indian context.
- Compliance costs are very high: PLCs operate under intense regulatory inspection, necessitating accurate attachment to a complicated web of compliance requirements.
- More vulnerable to a hostile takeover: If a majority of shareholders accept a bid from an acquiring entity, the company's ownership and control could change hands.
- Ownership & control issues: The separation of ownership and control inherent in a PLC structure can lead to conflicts of interest between shareholders and management.
- Not suitable for smaller organisations: The process of going public brings about big upfront costs, including underwriting fees, legal and accounting expenses, and marketing expenditures associated with the IPO.
Bottom Line
The journey to register a Public Limited Company in India gets started with a serious undertaking, demanding careful consideration of both opportunities and challenges. By understanding the regulatory rules, preparing all the necessary documents and following post-registration compliance obligations, your business can get the full potential of a powerful corporate structure.
Get in Touch
Reach out to us, to discuss how we can assist you in achieving your corporate objectives by registering as a public limited company.
FAQs
What is the minimum number of shareholders and directors required for a Public Limited Company?
A Public Limited Company in India requires a minimum of seven shareholders and three directors. Other options: Sole Proprietorship Registration and One Person Company Registration.
Can foreign nationals or entities be shareholders or directors in an Indian PLC?
Yes, foreign nationals and foreign entities can become the shareholders or directors in an Indian Public Limited Company, providing a significant advantage for international collaboration and investment. However, they must follow India’s Foreign Direct Investment (FDI) guidelines, which include specific rules regarding shareholding percentages, industry restrictions, and compliance obligations.
How long does the public limited company registration process typically take?
The duration of the registration process can vary based on the completeness and accuracy of the submitted documents and the workload of the Registrar of Companies (RoC).
What are the key differences between a Public Limited Company and a Private Limited Company?
The primary distinctions lie in the ability to offer shares to the public, minimum shareholding and directorship requirements, and regulatory compliance obligations.