With the new Company Law bill passed by the Parliament, “One Person Company (OPC)” comes to reality in our country. It is essentially a legal entity which functions on the same principle as a Company, but with only one member and one shareholder. It can be an alternative option for Individuals, who runs risky proprietorship business. What does it mean – a company which has only one person as a member and where legal and financial liability is limited to the company only and that person is not personally liable. Eligibility: One man can form a one man company, say a private company, by subscribing their names or his name to a memorandum and complying with the requirements of this Act in respect of registration:

• Provided that the memorandum of One Person Company shall indicate the name of the

other person also, with his prior written consent in the prescribed form, who shall, in the event of the subscriber’s death become the member of the company and the written consent of such person shall also be filed with the Registrar at the time of incorporation of the One Person Company along with its memorandum and articles.

• Provided further that such other person may withdraw his consent in such manner as may be prescribed.

• Provided also that the member of One Person Company may at any time change the name of such other person by giving notice in such manner as may be prescribed.

• Provided also that it shall be the duty of the member of One Person Company to intimate the company the change, if any, in the name of the other person nominated by him by indicating in the memorandum or otherwise within such time and in such manner as may be prescribed, and the company shall intimate the Registrar any such change within such time and in such manner as may be prescribed.

• Provided also that any such change in the name of the person shall not be deemed to be an alteration of the memorandum.

We would come back with more on this topic. In the meantime, if you need any assistance with matters relating to company law, please feel free to contact us. You may also like to visit our Company Law Secretarial Page.