Guide to OPC / One Person Company Registration and Incorporation in India

Characteristics or Features of One Person Company / OPC

When to consider Registering a One Person Company?

Consider the below points before deciding to choose OPC Private Limited Company as your choice of entity to do business.

Opt for an OPC Private Limited Company:

• When you need a separate “Legal Identity” for your business, and also want complete ownership and control.
• If you want to Limit your Liability (as opposed to a sole proprietorship concern)
• If you don’t want to use your personal assets as collateral for business loans
• If you decide to not have Employee Stock Options or ESOPs
• If you have decided not to have external investments or funding from Angel, Seed or Venture Capital Investors.

If you are unsure of choosing the right form of entity for your business, feel free to get in touch with us. Our Business Expert will guide you with the proper form of entity, suitable for your needs.

OPC / One Person Company Registration Process in India

As with a Private Limited Company, an OPC Private Limited Company is registered with the Registrar of Companies (MCA).

Steps for Registering / Incorporating an OPC Private Limited Company

Step 1: Obtain Digital Signature Certificate or DSC

It is mandatory for the Director / Shareholder / Member to have a valid Digital Signature Certificate (DSC). The registration process is online and the forms need to be signed electronically with the digital signature.  

The Digital Signature Certificates (DSC) must be obtained only from government recognized certifying agencies.

Step 2: Apply for Director Identification Number or DIN

Director Identification Number (DIN) is a unique Identification Number allotted to an individual who is appointed (or wants to be appointed) as a Director of a company. In order to apply for DIN, an application using Form DIR-3 needs to be made at the MCA website (Ministry Of Corporate Affairs).

A person can apply for DIN only once and the same DIN would be enough to become a Director in any number of companies.

However please note that a person can be a Member in ONLY One OPC Pvt Ltd.

Step 3: Name Approval / Reservation

In order to register or incorporate an OPC Private Limited Company in India, the name for the proposed company should be approved by the MCA Authorities. Hence, it is recommended to apply for the Name Reservation before applying for incorporation.

The proposed Company Name has to be unique and should not have been taken by any other business. Availability of the name can be searched on http://www.mca.gov.in/mcafoportal/showCheckCompanyName.do

Also, the proposed company name should not be already Trademarked by anyone else. You can check the Trademark availability here https://ipindiaonline.gov.in/tmrpublicsearch/frmmain.aspx

Few General Guidelines for Name Approval / Reservation:

• The Proposed Name should be easy to spell and remember
• The proposed name should provide a distinct identity to the company
• To the extent possible, the proposed name should be short & simple
• The proposed name should not contain any word opposed to Public Policy or should not be Prohibited by Law
• Proposed Name should not infringe any Trademark registered and should not be similar or identical to any existing Company / LLP

Step 4: Application for issuance of Certificate of Incorporation

Once the name is reserved and approved, the same shall be valid for only next 20 days. The next step is to file an application for obtaining the Certificate of Incorporation using SPICe forms has to be filed with the MCA (Within the valid time, if the name has been reserved).

Alternately, the name reservation step can be avoided, and the SPICe forms for obtaining the Certificate of Incorporation may be filed.

Drafting Memorandum of Association (MoA)

Memorandum of Association is a legal document which showcases the Main Objectives of the OPC private limited company as well as information on the member shareholder.

Drafting Articles of Association (AoA)

Articles of Association is a legal document which has the rules and regulations for the general management of the OPC private limited company.

They define the rights, duties, powers of the management of the company and also provides the manner in which the operations and administration should be carried on.

SPICe Form (Simplified Proforma for Incorporating Company Electronically)

Ministry of Corporate Affairs (MCA) has recently introduced the SPICe Form INC-32 where the full form translates to “Simplified Proforma for Incorporating Company Electronically” (company registration form).

Form INC-32 must be accompanied by supporting documents including Details of Directors & Subscribers, Affidavits, Declarations, Identity Proof, Address Proof, MoA, and AoA etc.

Once the eForm is filed, it shall be processed by the MCA’s Central Processing Centre. If found complete, the company would be registered and Corporate Identification Number (CIN) would be allocated along with a Certificate of Incorporation.

List of Documents Required for the Registration of an OPC Private Limited Company

Timeline – How long does it take to register an OPC Private Limited Company in India

Normally, if everything is in order, it may take anywhere between 8 to 12 business days for registering a private limited company. Below, breakup depicts the approximate timeline for registering a Private Limited Company in India: 

This timeline is further subject to Government processing, approval time, public holidays, etc.

OPC Private Limited Company Registration Fees / Cost

The basic Government fees for the OPC formation in india starts at as low as Rs. 3,000. Please note that the general fee includes the actual charges of all general formalities such as DSC, DIN, Form Filing, Name Approval, etc and stamp duty charges as well.

Also, keep in mind that Stamp Duty charges vary from one state to another. Eg: If you are registering your company in Bangalore, the Stamp Duty Charges levied by Karnataka State Govt are applicable. Therefore the government fee will change depending on the state you are based.

The Charges will also change as per the amount of share capital of your company and the number of Directors you wish to appoint. This is because you would need separate DIN and DSC for each individual director.

Other important things to consider – Post Incorporation Compliance Requirements of an OPC Private Limited Company

After incorporation / registration of an OPC company, certain additional compliances needs to be performed. Though the actual requirements differ from company to company, we have listed a few important Post Incorporation Compliances which an OPC company would normally comply.