PLC: Full Form and Meaning
The full form of PLC is Public Limited Company. It refers to a structure of a company that sells its shares to the general public and is listed on the stock exchange. Under the Companies Act 2013, minimum requirements to form a PLC includes the company must have a minimum of 3 directors and can have maximum 15 directors, and the company’s name must end with “limited”. PLC can be acquired by anyone, either through an Initial Public Offering (IPO) or by trading on the stock market.
Key Characteristics
- Limited Liability- liability of shareholders is limited to the amount unpaid on shares. They are not personally liable for the company’s debts.
- Capital Raising- raise capital from public by issuing shares through IPO
- Transferability of shares- shares are freely transferable, encouraging easy trading and liquidity for shareholders
- Prospectus- PLCs are required by law to issue a prospectus, which is a detailed document outlining the company’s affairs for potential investors.
Steps to Register a PLC
Step 1: Obtain Digital Signature Certificate (DSC)
Mandatory for all proposed directors and subscribers of the memorandum and articles of association.
Step 2: Obtain Director Identification Number (DIN)
Anyone intending to become a director must obtain a DIN that is included in the company registration form along with the name and address proof.
Step 3: Register on MCA Portal
Submit the completed SPICe+ on the MCA portal to apply for company registration.
Step 4: Obtain Certificate of Incorporation
Once submitted, the Registrar of Companies (ROC) will review the application and documents. After verification, ROC will issue the Certificate of Incorporation, then the company must apply for the ‘Certificate of Business Commencement’.
Documents Required to Register for PLC
- Proof of Identity, address and PAN number for all shareholders and directors
- Utility bill for the proposed registered office
- No Objection Certificate (NOC) from the landlord of the proposed office premises
- Director Identification Number (DIN) for all directors
- Digital Signature Certificate (DSC) for all directors
- Memorandum of Association (MOA)
- Articles of Association (AOA)
Thus, PLC is a business structure that offers numerous advantages like access to capital and company’s growth and reputability, however it also offers some challenges such as regulatory compliance and potential loss of control over the company’s functioning.
