PUBLIC LIMITED COMPANY REGISTRATION

 

Basic Information

 

In case of Public Company, minimum seven Subscribers / Promoters and three Directors are required for its formation whereas there is no cap on the maximum number of members and Public Company has more stringent regulatory requirements compared to a Private Limited Company.

 

The ability to have any number of members, fund raising from Public and ease in transfer of shareholding are some of the characteristics of Public Limited Company.

 

Advantages of Public Limited Company Registration

 

1. Separate Legal Entity: A company is a legal entity and a juristic person established under the Companies Act, 2013. Therefore a company form of organization has wide legal capacity and can own property and also incur debts. The members (Shareholders/Directors) of a company have no personal liability to the creditors of a company for such debts.

 

2. Easy Transferability: The Shares are freely transferable by a shareholder to any other person. Filing and signing of a share transfer form and handing over the buyer of the shares along with share certificates followed by intimation to the Company is enough to transfer the shares.

 

3. Uninterrupted Existence: A company has 'perpetual succession', which means continued / uninterrupted existence until it is legally dissolved. A company, being a separate legal person, is unaffected by the death or other departure of any member but continues to be in existence irrespective of the changes in membership.

 

4. Owning Property: A company being a juristic person, can acquire, own and alienate property in its own name. No shareholder can make any claim upon the property of the company so long as the company is a going concern.

 

5. Borrowing Capacity: A company enjoys better avenues for borrowing of funds. It can issue secured / unsecured debentures, and can also accept deposits from the public, etc. Even banking and financial institutions prefer to render large financial assistance to a company rather than partnership firms or proprietary concerns.