Public Limited Company (Unlisted)

Public Limited Company (Unlisted)

A company that has issued securities through an Initial Public Offering (IPO) and is traded on at least one Stock Exchange(s) or in the over the counter market. Although a small percentage of shares may be initially “Floated” to the Public, the act of becoming a Public Company allows the market to determine the value of the entire company through daily trading.

Public companies have inherent advantages over Private Companies, including the ability to sell future equity stakes and increased access to the debt markets. With these advantages, however, come increased regulatory scrutiny and less control for majority owners and company founders.
 

MINIMUM NUMBER OF MEMBERS:
Minimum seven persons are required to form a public listed company.
 
MAXIMUM NUMBER OF MEMBERS:
There is no such restriction.
 
MINIMUM NUMBER OF DIRECTORS:
A public limited company must have at least seven persons who should be individuals to constitute a Board of Directors (BOD) with powers vested in it to conduct the business and affairs of a company.
 
MAXIMUM NUMBER OF DIRECTORS:
There is no such restriction on the number of directors. The directors shall meet at least once each quarter of a year.
 
MINIMUM NUMBER OF SHARES:
Each subscriber is required to hold at least one share in his /its own name or in the name of the company or institution he is to represent on the BOD of a company.
 
TRANSFERABILITY OF SHARES:
There is no such statutory restriction and shares are freely transferable.
INVITATION TO PUBLIC:There is no such restriction, subject to the provisions of the Companies Ordinance, 1984 and the Listing Regulations (LR) of the stock exchanges.

PROSPECTUS:
It may issue a prospectus to invite general public to subscribe to its shares, debentures or deposits, subject to approval of the prospectus by the Securities and Exchange Commission of Pakistan (SECP) and the concerned stock exchange(s).
 
COMMENCEMENT OF BUSINESS:
A public company can commence business only when it receives the certificate to commence business from the Registrar of Companies subject to completion of corporate formalities as stipulated in the Ordinance. 
 
STATEMENT IN LIEU OF PROSPECTUS:
A public company is required to file a statement in lieu of prospectus with the Registrar of Companies at least three days before allotment of shares, where it does not issue a prospectus.
 
STATUTORY MEETING AND STATUTORY REPORT:
A public company must hold a statutory meeting and file statutory report within the prescribed time.
 
QUORUM OF GENERAL MEETING:
Not less than ten members personally or by proxy present at the general meeting shall be a quorum representing in the aggregate not less than 25% of the total voting power of a company.
 
DIRECTOR’S CONSENT:
A public company must file with the Registrar of Companies written consent of all its directors on prescribed format.
 
BOOK OF ACCOUNTS:
Books of account are required to be maintained at Registered Office of a company and are subject to audit. Company may keep books of account at some other place other than the registered office address subject to the prior intimation to the Registrar of Companies.
 
AUDITORS:
Auditor is to be appointed annually by a resolution of shareholders passed at their annual general meeting. A company is required to appoint a Chartered Accountant within the meaning of Chartered Accountants Ordinance, 1961 as auditors of a company.|
 
LOANS:
Company may subject to prior approval of SECP make loan to its directors, firm in which any director or his relative is a partner in a firm or director in a private limited company.
 
INTERCOMPANY INVESTMENT:
A public limited company may make investment in any of its associated companies or associated undertakings to any extent under the authority of a special resolution passed by its shareholders.
 
DISCLOSURE OF INTEREST BY DIRECTOR:
Every director of a company who is directly or indirectly, concerned or interested in any contract or arrangement by or on behalf of the company shall make a disclosure of his interest. Accordingly, interested director shall not participate or vote in proceedings of directors’ meeting wherein such matters are to be discussed and approved. The presence of such “interested directors” shall not be counted for quorum.
 
APPOINTMENT OF COMPANY SECRETARY:
Appointment of Company Secretary is mandatory under the Ordinance and Listed Regulations.