The recent pandemic situation has made the government take some initiatives which benefit both the country and the entrepreneurs. In recent times, this company in Bangladesh has come into the limelight. An amendment to the Companies Act 1994 was proposed that includes one person company (OPC). One person company has a single person as to its shareholder. Such companies must include one person company or OPC at the end of their names.
As the name suggests, only one person can register this company. This single person is the sole shareholder of the company. OPC is an established entity in other parts of the world. However, the concept is new in Bangladesh. OPC will get all the benefits of a registered company instead of a sole proprietorship.
What is One Person Company?
A one person company in Bangladesh (OPC) is a fairly new form of company in Bangladesh. The shareholder of the company is a single person. There must be a nominee in case of the death of the primary shareholder. Upon death, the company will be transferred to the nominee.
Provisions of One Person Company
As the owner and shareholder will be a single person, upon his/her death the company must be controlled by another single person. Here the owner or shareholder must appoint a nominee. This nominee can be anyone. Upon the death of the sole shareholder of the OPC, the company shall be entitled to the nominee appointed by the old sole shareholder. The nominee is entitled to the same benefits and liabilities as the old sole shareholder. The nominee can also appoint another person as his nominee upon his death. This process can go on.
Requirements of One Person Company
As section 392C suggests, 25 lakhs taka is the minimum paid-up capital of a one person company in Bangladesh. The maximum is 5 crore taka. The annual turnover must be between 1 crore and 50 crore taka. However, if the amount increases, the sole shareholder must convert the
company into a private limited company. Memorandum and Article of Association, as per section 392A required.
Structure of One Person Company
A sole person can form an OPC as per section 392B and can sign the memorandum. It is necessary to have one or more nominees in the memorandum and in the Article of Association of OPC. Only a sole person can register for an OPC.
As the name suggests, one person company in Bangladesh has a sole shareholder. This single shareholder shall be its director as well as manager or company secretary. Other employees can be hired for managing it.
It is mandatory to have at least one board meeting every 6 months as per section 392F.
At the end of a financial year, an OPC must share its financial statement and be submit it to the Registrar. The balance sheet must contain the profit and loss or income and expenses. This balance sheet must be signed by the director.
Required Documents For Registration
The documents mentioned below are the requirements for one person company registration:
- National ID card
- Passport Size picture
- TIN certificate
- Mobile number
- Email address
Required documents for the Nominee
The documents required for the nominee are the same as the documents required by the person registered the one person company. The nominee must be 18 years or above age to be entitled to the company after the death of the original owner.
One Person Company Registration
One Person Company registration in Bangladesh is a simple process. First, you must get approval for the selected name. Secondly, there must be a minimum of one director. This director can be local or foreign. Age must be 18 and above. Next, you must state the authorized capital in the Memorandum of Association and Articles of Association. The paid-up capital can be increased at any time. You must provide a registered address which must be local.
Limitations of One Person Company
One sole person can register only a single one person company in Bangladesh. He/she cannot have multiple one person company.
Benefits of One Person Company
Just like a Private limited company, one person company sole shareholder can perform multiple businesses under the company. If you want to appoint a new shareholder then you can but the company will be a limited company. You can start an OPC with less investment compared to a limited company.
This new entity in Bangladesh is a welcoming act. The positive development will contribute to the increase of Bangladesh economy. The facilities provided by a one person company will benefit a lot of entrepreneurs in Bangladesh. The requirements are also manageable. If you are an entrepreneur and want to start a business in Bangladesh with limited investment.