Procedure for Converting OPC to Private Limited Company

Detailed Note & Procedure On Conversion of OPC Into Private Limited Company

Overview: As per the section 2(62) of Companies Act, 2013 One Person Company” means a company which has only one person as a member. A One Person Company can convert itself into a Private Limited Company by complying with the procedures specified under the Companies Act, 2013 and rules made thereunder.

LEGAL FRAMEWORK IN RELATION TO CONVERSION OF OPC:

The provisions related to Conversion of OPC into Private Limited Company are contained under section 18 of the Companies Act, 2013 and The Companies (Incorporation) Rules, 2014.

As per Rule 6 of The Companies (Incorporation) Rules, 2014, the One Person Company shall alter its Memorandum and Articles by passing a resolution in accordance with sub-section (3) of section 122 of the Act to give effect to the conversion and to make necessary changes incidental thereto.

A One Person company may be converted into a Private or Public Company, other than a company registered under section 8 of the Act, after increasing the minimum number of members and directors to two or seven members and two or three directors, as the case may be and by making due compliance of section 18 of the Act for conversion.

PRE-REQUISITES FOR CONVERSION:

(i) Consent of Nominee of sole member of OPC

(ii) Appointment of Directors (Min. 2 Directors for Pvt. Ltd. Co.)

(iii) Increase in number of members & Transfer of shares

(iv) Changes in MOA & AOA

(v) Consent from the Directors and Creditors

DOCUMENTS REQUIRED FOR CONVERSION:

(i) Copy of latest financial statement

(i) Copy of NOC from the creditors

(ii) Copy of consent given by the nominee, directors and members

(iii) List of proposed directors and members

(iv) Copy of Altered MOA & AOA

FORMS TO BE FILED WITH ROC:

Form DIR-12 (for appointment of directors)

Form MGT-14 (for filing of resolutions to the registrar)

Form INC-6 (application for conversion)

Form INC-33 (e-MOA)(Linked to Form INC-6)

Form INC-34 (e-AOA)( Linked to Form INC-6)

PROCEDURE FOR CONVERSION:

Step 1: Appoint required number of Directors and file Form DIR-12 with ROC.

Step 2: Convene Board meeting and pass the resolutions regarding following matters:

1.To Convert the OPC into Pvt Ltd Co.

2. To transfer the shares to proposed members

3. To alter MOA & AOA of company.

4. To issue notice of EOGM.

Step 3: Convene Extra-Ordinary General Meeting (EoGM) and pass following resolutions:

1.To Convert the OPC into Pvt Ltd Co.

2. To Alter MOA & AOA of company.

Step 4: File Form MGT-14 with ROC within 30 days of passing SR along with following attachments:

1.Copy of Board Resolutions

2. Copy of Notice of EoGM

3. Copy of Special Resolution along with explanatory statements

4. Copy of Minutes of EoGM

5. Copy of Altered MOA & AOA

Step 5: File Form INC-6 for making an application for conversion along with following attachments:

1. Copy of Board Resolutions

2. Copy of Special Resolution along with explanatory statements

3. Copy of Altered MOA & AOA

4. Copy of latest Financial Statement

5. Copy of NOC from the creditors

6. Copy of consent given by the nominee, directors and members

7. List of proposed Directors and members

8. Share Transfer Document

Step 6: File Form INC-33 (e-MOA) and Form INC-34 (e-AOA) (Linked to Form INC-6).

IMPORTANT POINTS TO BE CONSIDERED WHILE CONVERSION:

1.No need to change the subscriber’s sheet of MOA & AOA, it should be same as filed with ROC at the time of incorporation of Company.

2. No need to alter first directors clause in AOA, only add a statement regarding appointment of new directors.

3. The transfer of shares must be completed before filing Form INC-6 with ROC.

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Prepared by: Rakesh Ramesh Fating