New Delhi, Feb 3 (PTI) The corporate affairs ministry on Wednesday said it has amended rules for One Person Companies (OPCs) and has extended fast track merger process to startups and other small companies.

In a release, the ministry said incorporation of OPCs is being incentivised in order to bring in more unincorporated businesses into the organised corporate sector.

The move is expected to directly benefit startups and innovators, especially those who are supplying products and services on e-commerce platforms.

With the amendments, OPCs will be allowed to grow without any restrictions on paid up capital and turnover as well as get converted into any other type of company at any time.

Besides, the residency limit for an Indian citizen to set up an OPC has been reduced from 182 days to 120 days, and Non-Resident Indians (NRIs) have been permitted to set up OPCs.

"The fast track process for mergers under the Companies Act, 2013 has also been now extended to also include mergers of startups with other startups and with small companies, so that the process of mergers and amalgamations is completed faster for such companies," the release said.

Also, the ministry has revised the threshold for paid up capital and turnover for small companies.

The threshold for paid up capital has been raised to Rs 2 crore from Rs 50 lakh and the turnover threshold to Rs 20 crore from Rs 2 crore.

"This is expected to benefit more than two lakh companies in terms of lesser compliances, lesser filing fees and lesser penalties (in the event of any defaults)," another release said.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)