1. Separate Legal Entity
- A Public Limited Company is recognized as a distinct legal entity.
- It can own property, enter into contracts, and sue or be sued in its name.
- The existence of the company is independent of its shareholders.
- It continues to operate even if the ownership or management changes.
- This feature ensures business continuity and legal protection.
2. Limited Liability
- The liability of shareholders is limited to the amount unpaid on their shares.
- Personal assets of shareholders are not at risk for company debts.
- Creditors cannot claim more than the value of shares held.
- This encourages public investment without fear of excessive risk.
- Liability structure increases trust and promotes business security.
3. Number of Members
- Requires a minimum of 7 shareholders to be registered.
- There is no maximum limit on the number of shareholders.
- A minimum of 3 directors is also required for governance.
- The broad member base allows for wide public participation.
- Shareholding can change without affecting the company’s structure.
4. Share Capital and Transferability
- Shares are freely transferable unless restricted by law or regulation.
- The company can raise capital by issuing shares to the public.
- Public issue of shares is done through an IPO or FPO.
- Shareholders can trade shares on recognized stock exchanges.
- Capital structure is flexible to meet funding needs.
5. Regulatory Compliance and Transparency
- Governed by the Companies Act, 2013, and SEBI regulations.
- Must file annual reports, financial statements, and disclosures.
- Requires regular board meetings and annual general meetings.
- Statutory audit and appointment of independent directors are mandatory.
- Compliance ensures accountability and boosts investor confidence.
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