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Corporate & Other Laws
whts the diff btwn a public Co thts not listed company and pvt company
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An unlisted public limited company is a public company that doesn’t have its securities and debentures listed on any stock exchange in India. The shares of such an entity are not available to the public for trading. It is basically a small company that doesn’t meet the listing requirements of the stock exchange. The reasons could be many. It might be too small to suit the stock exchange listing, might not seek public investors, or might be falling short of the required number of stakeholders. A private limited company, on the other hand, is a closed organization owned either by non-profit organizations or a small number of stakeholders. It cannot trade its shares to the stock market exchange or the public. The company’s stocks can be exchanged and traded only amongst its members. A private limited company is not required to disclose its financial information publicly. Also, - There is a restricted transferability of shares for a private limited company. It is also prohibited from inviting subscriptions from the public. An unlisted public limited enterprise is free of such restrictions. - The two also differ in the required number of members and directors. While a private limited company can set off with two directors and two members, an unlisted public company needs a minimum of 3 directors and 7 members. - There is also a limit on the number of members in a private limited company, 200 at present. - The minimum paid-up capital for an unlisted public limited company is 7 lacs while that for a private limited company is 1 lac. - The provision of quorum also varies for the two. In case of a public limited company, at least five shareholders need to be personally present at the meetings. For a private limited company, the number is only two. - While an unlisted public limited company can get its shares listed, a private limited company will always remain an unlisted entity. - While a private limited company enjoys several exemptions in different areas whereas an unlisted public limited company is bound by restrictions and compliances.
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