Public Limited Company (PLC)
KAPG & Associates

A Public Limited Company (PLC) is a type of corporation that offers its shares to the public, allowing anyone to buy shares on a stock exchange. Public Limited Companies are often chosen by larger businesses aiming for significant growth and wanting to raise capital through public investment. However, the added regulatory requirements mean that a PLC requires more resources and effort to maintain compliance. Here are the key features of a Public Limited Company:

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  1. Limited Liability: Like Pvt Ltd and LLP, the shareholders' liability in a PLC is limited to the amount they have invested, protecting personal assets from business liabilities.
  2. Separate Legal Entity: A PLC is an independent legal entity, distinct from its owners (shareholders). It can own assets, incur debts, enter contracts, and be sued or sue in its own name.
  3. Shares Publicly Traded: A PLC can sell shares to the public through stock exchanges, making it easier to raise capital from a broader pool of investors. Shares can be freely traded, which adds liquidity for shareholders.
  4. Higher Capital Requirements: PLCs typically require a higher minimum capital than private companies to protect investors and cover public obligations. This can vary by jurisdiction.
  5. Number of Shareholders: A minimum of seven shareholders is required to form a PLC, and there is no upper limit on the number of shareholders.
  6. Perpetual Succession: The company continues to exist regardless of changes in ownership, making it a stable and ongoing entity.
  7. Disclosure and Compliance Requirements: PLCs are subject to strict regulatory compliance, including financial audits, public disclosure of financials, shareholder meetings, and filings with regulatory bodies. This transparency builds public trust and accountability.
  8. Board of Directors: A PLC is managed by a board of directors who are accountable to the shareholders. This governance structure includes regular board meetings and shareholder votes on key issues.
  9. Access to Capital Markets: A PLC can raise funds more easily by issuing shares or bonds. This ability to attract capital from the public is one of the biggest advantages of being a public company.