One Person Company

In India, the first step in starting a business is to register a corporation. The Companies Act of 2013 created a new method of business creation called the One Person Company (OPC). OPC gives a single promoter complete control over the business; he will be its only shareholder and director (however, a director nominee is present, but has zero power until the real director proves incapable of executing the contract). An OPC is a hybrid business organisation that incorporates many of the advantages of both a sole proprietorship and a corporation. There is only one member who will serve in both the capacities of shareholder and director. The sole proprietor will receive from OPC all the advantages of a private limited company, including access to credit, bank loans, restricted liability, legal protection for his firm, market access, etc. However, it should be noted that there cannot be a chance for employee stock options or equity money to be funded under an OPC. Additionally, an OPC firm must change to a private limited company or public limited company within six months if it has an average annual revenue over the previous three years of Rs. 2 crores or more, or if it has obtained a paid-up fund of Rs. 50 lakh or more.