A One Person Company (OPC) is a unique concept introduced under the Companies Act, 2013, to encourage individual entrepreneurs to enter the corporate framework. As the name suggests, an OPC is a company that can be formed with just one person as its sole member and shareholder. Unlike a sole proprietorship, which is not a separate legal entity, an OPC enjoys a distinct legal identity, limited liability, and perpetual succession.

The concept is significant because it provides a simple and structured way for a single individual to operate a business with the benefits of a company. It reduces the burden of compliance compared to private or public companies and is especially beneficial for startups and small entrepreneurs who wish to avoid the complexities of having multiple promoters or shareholders. The limited liability protection ensures that the personal assets of the individual are not at risk in case of business losses or debts.

Additionally, the OPC structure allows access to funding, credibility, and legal recognition while retaining full control in the hands of the single owner. It serves as a bridge between a sole proprietorship and a full-fledged private limited company, making it a valuable tool for fostering entrepreneurship in India.