IndiaFilings » Learn » Nominee in One Person Company

Nominee in One Person Company

Nominee One Person Company

Nominee in One Person Company 

In the dynamic business landscape of India, OPCs have gained popularity as a favorable option for entrepreneurs. This unique business structure allows individuals to independently establish and manage a company, providing limited liability and various benefits. Understanding the importance of having a nominee in an OPC is crucial. The nominee acts as a custodian of the One Person Company registration and works towards its continued success and growth. In this article, we will explore the concept of a nominee in an Indian OPC and its significance in ensuring the smooth functioning and continuity of the business.

One Person Company (OPC) – At a Glance

Let’s begin by gaining a brief understanding of what an OPC is. As the name suggests, an OPC is a type of company that can be formed with just one person as its member. It allows entrepreneurs to operate as a separate legal entity, providing limited liability protection, similar to a private limited company. This structure combines the benefits of a sole proprietorship and a company, offering several advantages to the business owner.

Nominee to One-Person Company

In the incorporation process of an OPC, the sole director and shareholder must nominate a person who will act as their successor in the event of their incapacity or demise. This nominated individual is known as the “nominee” and plays a vital role in ensuring the continuity and stability of the OPC.

 This nominee plays a crucial role and steps in to take charge of the company in the event of the sole director’s death or incapacitation. It is essential to highlight that the provision for a nominee in an OPC is distinct from succession under personal law. Instead, it is a specific requirement outlined in the Companies Act 2013.

Significance of a Nominee in an OPC

Following the Companies Act 2013 provisions, an OPC requires a nominee’s appointment. The nominee plays a crucial role and is designated to take over the company’s affairs if the sole member becomes incapacitated or dies. The nominee ensures the business’s continuity and protects stakeholders’ interests.

By designating a nominee, the OPC ensures a smooth transition of control and management in case the sole director cannot fulfill their responsibilities.

Becoming a Nominee of a One-Person Company

As mentioned above, in establishing a One Person Company (OPC), appointing a nominee who will act as a successor to the sole director and shareholder in case of incapacity or demise is mandatory.

Step 1: Written Consent

The first step in becoming a nominee of an OPC is providing written consent to the sole director and shareholder. This consent signifies your willingness to take on the responsibilities associated with the role of a nominee. It is essential to review the responsibilities and obligations before consenting carefully.

Step 2: Qualifications

Specific qualifications must be met to become a nominee in an OPC.

  • Indian Citizen: You must be a citizen of India.
  • Indian Resident: You should be a resident of India.
  • Age Requirement: You must be of legal age, 18 years or above.

It is crucial to meet these qualifications to be eligible for the position of a nominee in an OPC. It is essential to select a trustworthy, reliable, capable person to handle the responsibilities of being a nominee.

Step 3: Agreement with the Sole Director and Shareholder

Once you have given your written consent and meet the necessary qualifications, you must agree with the OPC’s sole director and shareholder. This agreement formalizes your role as a nominee and outlines the responsibilities, rights, and obligations associated with the position.

Step 4: Intimation to the Registrar

After completing the agreement, the OPC must submit the required documents to the Registrar of Companies (ROC). These documents include the consent letter, agreement, and other required forms under the Companies Act 2013. The OPC must ensure compliance with the prescribed format and submit the documents within the stipulated time frame.

Role and Responsibilities of a Nominee

The nominee in an OPC has specific duties and responsibilities that need to be fulfilled. These include:

  • Taking over the affairs: In the event of the sole member’s incapacitation or demise, the nominee manages the company’s affairs and ensures its smooth functioning.
  • Completing legal formalities: The nominee is responsible for completing all necessary legal formalities, such as filing documents and maintaining compliance with regulatory requirements.
  • Protecting stakeholders’ interests: The nominee is a custodian of stakeholders’ interests and ensures that the company’s operations continue without disruption.

Benefits of Having a Nominee in an OPC

A nominee in an Indian OPC offers several benefits for the business owner and the company. Let’s explore some of these advantages:

  • Business Continuity: The presence of a nominee ensures that the business can continue its operations even in the absence of the sole member. This provides stability and reassurance to the stakeholders.
  • Limited Liability: The nominee protects the interests of the company’s creditors and other stakeholders, limiting their liability and safeguarding their investments.
  • Flexibility: The nomination can be changed by the sole member during their lifetime, providing flexibility to adapt to changing circumstances or preferences.
  • Confidentiality: The nominee’s identity can be kept confidential, which may be desirable for individuals who wish to maintain their privacy while operating the business.

Nominee Withdrawal

A nominee can withdraw their consent by providing written notice to the sole member and the OPC. Upon receiving the withdrawal notice, the sole member has fifteen days to propose another nominee. The OPC must file a notice of the change in nominee with the Registrar using Form INC-4. The fresh nominee’s consent should be submitted in writing using Form INC-3 within thirty days of acknowledging the withdrawal notice and the change in a nominee.

Death of the Director in an OPC

In the unfortunate event that the sole member of an OPC passes away or becomes incapable of entering into a contract, the nominee automatically becomes a member of the company. Within fifteen days of becoming a member, the new member must propose a person to act as their nominee. The OPC is then required to file an indication of the cessation of the former member and the nomination of the new member with the Registrar, using Form INC-4. The written consent of the newly listed person should be included in Form INC-3.


The presence of a nominee in a One Person Company is a crucial aspect of its structure and operations. The nominee ensures the company’s smooth functioning and continuity, reassuring stakeholders. It is imperative for entrepreneurs considering OPC registration to carefully select a nominee who meets the necessary qualifications and possesses the qualities required to fulfill the responsibilities associated with the role. An OPC can enhance its credibility, stability, and long-term prospects by designating a nominee.