One Person Company (OPC) vs Private Limited Company – Difference

A one-person company refers to a business with just one member. A firm with just one shareholder among its members is an OPC. A private limited company is a type of business where there must be a minimum of two members and a maximum of 200.

The major difference between a one-person company and a private company is that a one-person company is a mixture of a sole proprietorship and a company form of business, whereas private companies are either run by non-governmental organizations or by relatively small numbers of shareholders.

What is a one-person company (OPC)?

A one-person company (OPC) is a business owned and controlled exclusively by one person, thereby allowing a person to incorporate a one-person company alone. It is also known as a sole proprietorship.

A person can be nominated by the shareholder as a nominee in case of death/incapacity of the original shareholder. The nominee must give his/her consent beforehand.

There is no such concept of a board of directors in a one-person company as it’s a single entity and can work single-handed. In some cases, a minor and unsound person may not be eligible to incorporate one person company.

What is a Private Limited Company?

A private limited company can be incorporated by at least two people and can be managed by foreign investors. Unlike a one-person company, a private limited company must have a minimum of two shareholders. A quorum of two members should be present in the general meeting.

A private company requires a minimum of two directors and the limit can be extended up to many according to the rules of the country.

A minor and unsound person may not be eligible to incorporate a private company, which is the same as a one-person company.

It is not mandatory to get converted into a public company under any circumstances, but a private company can voluntarily take the decision under the company’s act. A private company must have a “Pvt. Ltd.” suffix at the end according to the rules and regulations of the companies act.

A one-person company is a new concept where individuals can undertake any business from home or can start any small business from scratch. A private company is the most popular form of business in India where two people can start any business to take it to another level of greatness.


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