The introduction of One Person Company
(OPC) in India is a move that will encourage micro businesses and
entrepreneurship with simpler legal compliances that will enable individuals to
generate economic growth as well as employment opportunities.
The concept of OPC was introduced in the Companies Act, 2013
("Act") as an alternative to the â€˜sole-proprietorshipâ€™ form of
business. Under the Act, a single national person can constitute a Company. An
OPC model can operate with a minimum of one shareholder and one director as
against the general minimum requirement of two shareholders and directors for a
private limited company. The sole shareholder can himself be the sole director.
OPC is a perfect combination of the characteristics of a company
and the freedom of a sole proprietorship. The concept opens up an avenue of
possibilities for entrepreneurs who can now take the advantages of limited
liability and corporatization. OPC will give the young entrepreneurs the
benefits of a private limited company such as access to credits, bank loans,
limited liability etc.