One Person Company Registration in Bangladesh i.e OPC Company Formation
Introduction to the One-Person Company Formation and Registration Process in Bangladesh
The COVID-19 pandemic has presented difficulties for the investment and commerce sectors. The government has taken the initiative to address the issue by amending the Companies Act of 1994 to include one-person companies (OPCs) in its toolkit. This will facilitate investment and commerce. This article will examine the definition of a “person company,” how to register one, how much capital it needs, liabilities, and all other pertinent legal information.
What a One Person Company (OPC) is defined as in Bangladesh
The modification defines a One Person Company (OPC) as a business that has one natural person as a shareholder, in accordance with the recently adopted section 11A(c). The phrase “one person company or OPC” needs to be included at the conclusion of these businesses.
Registering as a one-person business in Bangladesh
As a result, under the recently added section 392B, a natural person may include an OPC for any permissible purpose by signing the memorandum. It is further explained in this part that each individual may only incorporate one OPC.
Documents needed to register a single-person business
For the purpose of registering a one-person business, the nominee and the only shareholder need the following paperwork:
- Identification card (national),
- passport-size photo,
- TIN certificate,
- mobile number,
- email address,
- and signature
Can a non-citizen form an OPC?
A foreigner may not be able to form an OPC even though there is no obvious barrier to doing so. The required technique for registration requires the shareholder’s NID, which a foreigner does not have.
Details of the Memorandum
The nominee’s name, who will be recognized as the company’s shareholder in the event of the shareholder’s incapacity or death, must be in the memorandum. The candidate will bear the same obligations and rights as the original shareholder who nominated him or her. A candidate only needs to withdraw their consent to be listed if they wish to have their name removed from the list. The shareholder may take the nominee’s place in the event of the nominee’s demise or incapacity. In the event of their death, the nominee may designate a successor.
Capital needed to start an OPC
According to section 392C, the minimum paid-up capital for a one-person business is 25 lakhs taka, and the maximum paid-up capital is 5 crore taka. The preceding fiscal year’s yearly turnover has to be between 1 and 50 crore taka.
If the paid-up capital or turnover increases, the sole shareholder is required to convert the business into a public limited company or private limited company, subject to meeting certain requirements. A memorandum and the association’s articles are also necessary, per section 392.
Director of a Single-person Business
The director will be the only natural shareholder. The manager, secretary, and other staff members may be appointed by the director as needed. The OPC director will chair at least one meeting throughout a fiscal year.
Modification to the memorandum
Any changes to the memoranda must be brought to the attention of the Registrar in accordance with the prescribed protocol. Any modifications to the memoranda must be approved by the highest court. Changes to the articles of association may be made by contacting RJSC, the register’s registered office.
Sheet of balances
The OPC has 180 days from the end of the fiscal year to submit the balance sheet, financial records, and other required papers to the register. Every balance statement that is signed by the Director, the only stakeholder of the one-person business, must include the profit and loss or income and expenses.
All of the OPC’s shares may be transferred to any other person who has a natural person, subject to the restrictions outlined in section 392H. Procedure for Forming & Registering a One-Person Company in Bangladesh
(i) A letter stating that the company’s board of directors approved the share transfer; (ii) A document listing the number of shares the company wants to transfer; (iii) Signed Form 117; (iv) A board resolution from the company approving the share transfer; and (v) A share transfer certificate.
The possibility of limited liability through the establishment of a distinct legal entity is one of the most notable advantages of OPC. The shareholders are not forced to bear the company’s liabilities. The owner of the business’s assets won’t be in danger in the event of an unexpected circumstance. On the other hand, the proprietorship firm’s personal assets are in jeopardy in situations where the business’s fluctuations are visible.
The entrepreneur’s personal property is unaffected by the losses or debts incurred by the OPC, which simply resulted from the normal course of business. In a sole proprietorship, the owner would be liable for paying off the debts and liabilities if this were the case. On the other hand, in cases where the OPC has limited responsibility, the shareholder’s liability may be restricted in proportion to the amount of unpaid subscription fees.
Requirements of the OPC
Keeping in mind that the business is a distinct legal entity, the member cannot be held responsible for the contractual commitments of the OPC even if they own all of the company’s shares.
The Companies Act of 1994 has improved with the introduction of OPC. This will increase protections for lone investors while facilitating business and commerce. With the help of its knowledgeable and skilled attorneys, Company Law Firm in Bangladesh (Lawfirm.com.bd) is a full-service law firm in Dhaka that has been handling all kinds of matters pertaining to foreign investments and company formation in Bangladesh. For this reason, feel free to visit our office or get in touch with us through:
Dhaka: House 410 Road 29, Mohakhali New DOHS, Dhaka, Bangladesh
London:330 High Holborn, London, WC1V 7QH
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