Public Limited
A public company provided legal protection of limited liability and perpetual succession to its members.
Public company requires minimum seven members and minimum three directors . However, there is no limit on maximum number of members, and no minimum paid up capital requirement with full liberty of issuing its shares to any person.
Key Attributes
| Limited Liability:- | Personal liability of the members is limited |
|---|---|
| Separate Legal Entity:- | A public company is a separate legal entity from its shareholders and directors |
| Duration/ Uninterrupted existence:- | A company has ‘perpetual succession’, that is continued or uninterrupted existence until it is legally dissolved |
| No Limit on number of members:- | There is no limit on maximum number of members |
| Capital Raising:- | A public limited company can raise funds by issuing shares to public at large as there is no limit on maximum number of members |
| Professional Image:- | A public company gives a professional image to businesses and more assurance about its stability. This attracts new customers or investors. |
Advantages of public limited:
- Personal liability of the members is limited
- separate legal entity from its shareholders and directors.
- continued or uninterrupted existence until it is legally dissolved
- can raise funds by issuing shares to public
- no limit on maximum number of members
Disadvantages of public limited:
- increased regulatory requirements and scrutiny
- Higher levels of transparency required
- Lack of Flexibility
- Initially require minimum seven members and three director to start
Procedural Aspects
- Choose and apply name of the company
- Submit requisite forms & documents (including MOA AOA)with ROC and obtain Certificate of Incorporation
- Open a bank account
- Apply for registrations like GST, IEC, Startup, MSME etc
