What Is an LLP (Limited Liability Partnership) and How Does It Work?

Aug 14, 2025
Private Limited Company vs. Limited Liability Partnerships

In today’s dynamic business landscape, the Limited Liability Partnership (LLP) has emerged as a compelling choice for entrepreneurs, startups, and professional service providers. Offering the legal strengths of a company alongside the flexible governance of a partnership, LLPs are gaining remarkable popularity across India.

  • In the financial year 2023-24 alone, the number of LLP registrations soared by a striking 39%, reaching 58,990—a clear reflection of growing confidence in this structure.
  • The upward momentum continued into 2025, with May witnessing a 37% year-on-year jump in new LLP incorporations—outpacing the 29% growth seen in company registrations

These figures underscore a powerful trend: LLPs are fast becoming the go-to vehicle for professionals and small businesses seeking liability protection, compliance ease, and operational flexibility.

Table of Contents

What is LLP?

An LLP or Limited Liability Partnership is a business structure where business partners share limited liability, meaning their personal assets are protected in case the business incurs debts or liabilities.

LLPs are commonly used by professionals like lawyers, accountants, and consultants but are increasingly popular among small and medium-sized enterprises (SMEs).

An LLP is an ideal structure for businesses seeking operational flexibility, protection for partners' personal assets, and minimal compliance requirements. It is particularly attractive for professionals and small enterprises looking for a formal and efficient business framework.

This business structure also allows businesses to make use of the benefits of economies of scale, since LLPs can pool resources, expertise, and capital from multiple partners. By sharing operational responsibilities and costs, LLPs can reduce per-unit expenses, streamline processes, and negotiate better terms with suppliers.

This collaborative approach enables businesses to grow efficiently, expand their market presence, and achieve cost advantages typically associated with larger organizations.

How an LLP (Limited Liability Partnership) Works?

1. Hybrid Business Structure

A Limited Liability Partnership (LLP) is a flexible business structure that operates with a mix of partnership and corporate elements.

2. Limited Liability Advantage

The main advantage of an LLP is that it provides limited liability to its partners. This means that, unlike a general partnership, your personal assets (such as your home or car) are typically protected in case of legal action.

3. Lawsuit and Liability Rules

In an LLP, if the business faces a lawsuit, the partnership itself becomes the primary target, not the personal property of the individual partners. However, if a partner personally engages in wrongdoing (e.g., fraud), they could still be held liable for their actions.

4. Example: Meena and Shalini’s Case

  • Starting Out: Consider a scenario where two professionals, Meena and Shalini, decide to start a business offering consulting services in India. They have a shared interest in providing management consulting to small and medium enterprises (SMEs). Initially, they start with a mutual agreement and an informal arrangement.
  • Formalizing the Structure: However, as the business grows, they realize the need to formalize the structure to protect themselves from legal and financial risks. Meena and Shalini choose to form an LLP (Limited Liability Partnership) to safeguard their personal assets from any potential legal liabilities that may arise in the course of business. They register the LLP with the Ministry of Corporate Affairs (MCA) in India, creating an LLP agreement that outlines their responsibilities, profit-sharing ratios, and other operational details.
  • Facing a Legal Dispute: A few months later, the consulting firm faces a legal dispute due to an issue with one of their clients. The client sues the LLP for professional negligence, claiming that the advice given led to a loss in business.
  • Outcome of the Lawsuit: Since Meena and Shalini have formed an LLP, their personal assets—such as their homes, personal savings, or vehicles—are protected. The lawsuit can only target the assets of the LLP itself, not their personal belongings. However, if it is proven that either Meena or Shalini acted negligently or fraudulently in a personal capacity, that partner could still be held accountable for their individual actions.

LP (Limited Partnership) vs General Partnership

An LP (Limited Partnership) and a General Partnership are both business structures involving two or more partners, but they differ in terms of liability and management roles.

Limited Partnership (LP)

  • In an LP, there are two types of partners: general partners and limited partners.
  • General partners have full control over the management of the business and bear unlimited liability, meaning they are personally responsible for the business's debts and obligations.
  • Limited partners, on the other hand, contribute capital but do not participate in day-to-day management. Their liability is limited to the amount they invest in the business, protecting their personal assets beyond that contribution.

General Partnership

  • In a General Partnership, all partners share equal responsibility for managing the business and have unlimited liability.
  • This means they are personally liable for the debts and obligations of the business.
  • There is no distinction between the roles of partners—each partner participates in both the management and the liabilities of the business.

Key Difference

The key difference between the two is the level of liability protection and management involvement.

  • An LP offers limited liability to some partners (limited partners).
  • A General Partnership places full responsibility on all partners, making it a riskier option for individuals seeking protection from personal liability.

Related Read: What is the Difference Between LLP and Partnership?

LLP vs LLC

Ownership and structure

LLP refers to Limited Liability Partnership, where two or more partners collaborate to run the business. The partners can be individuals or corporate entities, and the number of partners can vary.

In an LLP, all partners share the management responsibilities and decision-making processes, unless the partnership agreement specifies otherwise. Partners have limited liability, meaning their personal assets are protected from business debts or legal claims.

LLC refers to a Limited Liability Company, which is a separate legal entity that can have one or more owners, known as members. The ownership can be divided among individual or corporate members, and the structure is more flexible than a corporation.

LLCs can be managed either by members (member-managed) or by designated managers (manager-managed). The members are not personally liable for the company’s debts or liabilities, providing them with protection similar to that of an LLP.

Liability protection

Partners in an LLP enjoy limited liability, meaning they are not personally liable for the debts or obligations of the business beyond their contribution to the partnership. However, if a partner engages in fraudulent or wrongful activities, they could still be personally liable for their actions.

LLC members also have limited liability, meaning they are generally not personally responsible for the company’s debts or liabilities. The LLC itself is a separate legal entity, so any financial obligations fall on the company, not the individual members. Similar to an LLP, members are protected unless they personally guarantee a debt or engage in illegal activities.

Decision making and management

In an LLP, all partners typically have a say in the management and operation of the business, unless otherwise specified in the LLP agreement. It is a more flexible structure in terms of decision-making since there is no requirement for a formal management team.

LLCs can be either member-managed or manager-managed. In a member-managed LLC, all members participate in managing the business, while in a manager-managed LLC, the members appoint managers to run the operations. This offers more structure compared to an LLP, especially for larger businesses.

Ownership transfer

Ownership in an LLP is typically not as easily transferable as in an LLC. Partners usually need to approve the admission of new partners or the transfer of ownership. This limits the liquidity and transferability of ownership interests.

Ownership in an LLC can be transferred more easily than in an LLP, depending on the terms of the operating agreement. LLCs can issue membership interests that can be bought or sold, making it easier to bring in new investors or transfer ownership.

LLP vs LP

An LP refers to a Limited Partnership, which is different from an LLP.

An LLP (Limited Liability Partnership) and an LP (Limited Partnership) are both business structures that involve multiple partners but differ in terms of liability and management.

In an LLP, all partners share equal responsibility for managing the business and enjoy limited liability, meaning their personal assets are protected from business debts. However, all partners are involved in decision-making unless specified otherwise in the agreement.

In contrast, an LPconsists of general partners and limited partners. General partners manage the business and have unlimited liability, while limited partners are only liable up to the amount of their investment and do not participate in the day-to-day operations.

The key difference lies in the roles and liabilities of the partners. In an LLP, all partners have equal liability protection and management control, whereas, in an LP, the general partners hold the management responsibility and are personally liable, while limited partners have liability protection but no management involvement.

The choice between the two structures depends on the desired level of involvement in business operations and the type of liability protection needed.

What are the advantages of LLP?

Wondering why you should choose LLP over other business registrations? Have a look:

  • Easy & quick to build: Building an LLP is a simple process. It does not have complicated steps and requirements and neither does it take months of waiting time. The minimum amount of fees for incorporating an LLP is INR 500 and the maximum that can be spent is INR 5,600
  • Continuity in succession: The life of the LLP is not affected by the death or retirement of any of the partners. If one of the partners withdraws because of any reasons, it does not mean that the LLP gets wound up. An LLP can only be shut down on the basis of the provisions of the Limited Liability Protection Act  of 2008
  • Limited liability: All the partners of the LLP have limited liability, which means that the partners are not liable to pay the debts of the company from their personal assets. No partner is responsible for any other partner’s misbehaviour or misconduct
  • Streamlines management: All the major decisions and management activities in an LLP are taken care of by the board of directors hence the shareholders receive very less power in making decisions
  • Hassle-free transfers: There are no restrictions on joining and leaving an LLP. One can easily admit as a partner and transfer the ownership to others
  • Taxation benefits: An LLP is exempt from various taxes such as dividend distribution tax and minimum alternative tax. Also, the rate of tax is less when compared to other business types
  • No compulsory audit requirements: There is no mandatory audit requirement for an LLP until the company exceeds the annual turnover of INR 40 lakhs

What are the disadvantages of LLP?

  • Not covered in all States: In India, there are certain variations in tax benefits from State to State. There are also cases when States restrict the formation of LLP. This is one of the major disadvantages of an LLP
  • Less credibility: An LLP has many benefits but the fact is that people do not consider LLPs to be a credible business. People still trust companies or partnerships over LLPs
  • Differences amongst partners: Since each partner is responsible for their own part, there are cases when partners do not consult each other before proceeding with a decision or agreement
  • Transfer of interest: Though interest and ownership can be transferred, it usually is a long procedure. Various formalities are required to comply with the provisions of the Limited Liability Partnership Act

Related Read: LLP Advantages and Disadvantages

Documentation requirements for registering an LLP (2025)

Before you start with the procedure of registering an LLP or make changes in an existing LLP, have a look at the list of documents you might need:

  • Form 7 is required to obtain a Designated Partner Identification Number (DIN) while registering your LLP. It may be sought from the MCA website. Along with the duly completed form, a registration fee of INR 100 must also be paid
  • Form 1/ RUN-LLP is required to register a name for the LLP and reserve it. It may be used to christen an LLP or to alter the present name. The fee for submitting this form is Rs 10,000
  • A request must also be filed by the partners for their DSC to be registered if it hasn’t already been done before
  • Form 2/FiLLiP is required for incorporating a registered LLP. This form must be sent to and acknowledged by the concerned State’s Registrar
  • An LLP agreement must be made, which outlines the duties of each partner involved. This requires the filling and submitting of Form 3
  • In the case of changing, altering, adding or removing partners, the partners must submit Form 4
  • Form 11 must be used to file the IT returns of the LLP
  • If the office address of the LLP is to be changed, then Form 15 must be filed

How to form a Limited Liability Proprietorship

As mentioned earlier, forming an LLP is easy and quick. Before you get started, obtain a DSC or Digital Signature Certificate as the following steps will require it. File for one if you don’t already have one. Further, here are the steps involved in forming an LLP. You can visit mca.gov.in and follow the steps listed below:

  1. Issue a Designated Partner Identification Number for yourself, which serves as an ID card
  2. File Form 7 and pay the required fees
  3. Register a name for your LLP using Form 1 and pay Rs 200
  4. Incorporate the LLP via Form 2. The LLP agreement must also be made at this stage
  5. File the LLP Agreement as per Section 2(o) of the LLP Act, 2008 using Form 3

With the above-mentioned steps, you are all set to start an LLP of your own.

Frequently Asked Questions

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Private Limited Company
(Pvt. Ltd.)

1,499 + Govt. Fee
BEST SUITED FOR
  • Service-based businesses
  • Businesses looking to issue shares
  • Businesses seeking investment through equity-based funding


Limited Liability Partnership
(LLP)

1,499 + Govt. Fee
BEST SUITED FOR
  • Professional services 
  • Firms seeking any capital contribution from Partners
  • Firms sharing resources with limited liability 

One Person Company
(OPC)

1,499 + Govt. Fee
BEST SUITED FOR
  • Freelancers, Small-scale businesses
  • Businesses looking for minimal compliance
  • Businesses looking for single-ownership

Private Limited Company
(Pvt. Ltd.)

1,499 + Govt. Fee
BEST SUITED FOR
  • Service-based businesses
  • Businesses looking to issue shares
  • Businesses seeking investment through equity-based funding


One Person Company
(OPC)

1,499 + Govt. Fee
BEST SUITED FOR
  • Freelancers, Small-scale businesses
  • Businesses looking for minimal compliance
  • Businesses looking for single-ownership

Private Limited Company
(Pvt. Ltd.)

1,499 + Govt. Fee
BEST SUITED FOR
  • Service-based businesses
  • Businesses looking to issue shares
  • Businesses seeking investment through equity-based funding


Limited Liability Partnership
(LLP)

1,499 + Govt. Fee
BEST SUITED FOR
  • Professional services 
  • Firms seeking any capital contribution from Partners
  • Firms sharing resources with limited liability 

Frequently Asked Questions

What should an LLP agreement include?

Typical clauses cover the registered office, business nature, rights and duties of partners, contributions and profit-sharing, voting rights, process for adding or removing partners, transfers, and dispute resolution mechanisms.

Who can become a partner, and what are the rules around it?

  • A minimum of two partners is required. If the number drops below two for over six months, the remaining partner can be held personally liable.
  • Partners can be individuals or corporations. Foreign partners must adhere to FDI norms and make contributions through approved banking channels at fair market value.
  • What are the compliance obligations for LLPs?

    Every LLP must file:

    • Form 8 (Statement of Account & Solvency), and
    • Form 11 (Annual Return)
      within 60 days from the end of the financial year (by May 30th for FY ending March 31).

    How is an LLP taxed?

    LLPs are taxed at a flat rate of 30% (plus surcharge and cess). They are exempt from dividend distribution tax, and partners are taxed individually when profits are distributed.

    Can existing businesses convert to an LLP?

    Yes, existing structures like private companies or partnership firms can convert to an LLP by following specific processes laid out in the LLP Act.

    Swagatika Mohapatra

    Swagatika Mohapatra is a storyteller & content strategist. She currently leads content and community at Razorpay Rize, a founder-first initiative that supports early-stage & growth-stage startups in India across tech, D2C, and global export categories.

    Over the last 4+ years, she’s built a stronghold in content strategy, UX writing, and startup storytelling. At Rize, she’s the mind behind everything from founder playbooks and company registration explainers to deep-dive blogs on brand-building, metrics, and product-market fit.

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    Related Posts

    Private Limited Company vs. One Person Company (OPC)

    Private Limited Company vs. One Person Company (OPC)

    Choosing the right business structure is a crucial decision for any entrepreneur. In India, two popular options are the Private Limited Company (Pvt Ltd) and the One Person Company (OPC). While Pvt Ltd companies suit growth-oriented startups with aspirations to scale, OPCs cater to solo entrepreneurs seeking simplicity with limited liability.

    This blog explores the key features, benefits, and differences between these structures to help you decide what’s best for your business.

    Table of Contents

    Difference between Private Limited and One Person Companies

    Although we will explore each legal structure in the upcoming sections, let's currently delve into a comparative analysis between these two entities.

    Private Limited Company One Person Company
    Suitable For Financial Services, Tech Startups, Medium Enterprises Franchises, Retail Stores, Small Businesses
    Shareholders/ Partners Minimum – 2
    Maximum – 200
    Minimum – 1
    Maximum – 1
    Nominee Not required One Nominee mandatory
    Minimum Capital Requirement No minimum capital requirement No minimum paid-up capital requirement exists. However, the minimum authorized capital required is Rs. 1,00,000 (One Lakh)
    Tax Rates The basic tax rate, excluding Surcharge and Cess, is 25% The applicable Tax rate to the OPC would be 25%, excluding cess and surcharge
    Fundraising Multiple options for Fundraising Limited options for Fundraising
    ESOPs Can issue ESOPs to the Employees Unable to issue ESOPs to the Employees
    DPIIT Recognition Eligible for DPIIT recognition Ineligible for DPIIT recognition
    Transfer of Shares Shares can be easily transferred by amending AOA Transfer of shares isn’t possible; it can only be done in case of transfer of ownership
    Agreements Duties, Responsibilities, and other basic clauses outlined in MOA and AOA Duties, Responsibilities, and other basic clauses outlined in MOA and AOA
    Compliances • More compliance costs
    • Mandatory 4 Board Meetings
    • No mandatory audits till a specified threshold limit
    Less Compliance Costs
    Minimum 2 Board Meetings
    Mandatory Audits
    Foreign Directors NRIs and Foreign Nationals can be Directors No foreign directors are allowed
    Foreign Direct Investment Eligible through Automatic route Not eligible for FDI
    Mandatory Conversion No mandatory conversion If annual turnover exceeds Rs. 2 Crores or paid-up capital exceeds Rs. 50 lakhs, then mandatory conversion into a private limited company

    While we have provided some context on the differences between a private limited company and an OPC, let's break down their features and registration process in detail. This will help you figure out which one suits your business needs best.

    What is a Private Limited Company?

    A Private Limited Company (Pvt Ltd) is one of the most sought-after business structures in India. It combines the benefits of limited liability, a separate legal identity, and scalability.

    It’s a privately held entity governed by the Companies Act of 2013 and is often chosen for its ability to combine the flexibility of partnerships with the advantages of corporate status.

    In a Private Limited Company, shareholders' liability is limited to the extent of their shareholding, which means personal assets are protected in case the company incurs losses or debts. This makes it an attractive option for entrepreneurs looking to build a scalable business while minimising financial risks.

    In short, a Private Limited Company is ideal for entrepreneurs with big ambitions, as it provides:

    • A formal structure for business operations.
    • Easier access to funding through equity or debt.
    • A professional image that boosts credibility with investors and customers.

    Private Limited Company Registration

    Registering a Private Limited Company involves a detailed process governed by the Companies Act, 2013.

    Step-by-Step Guide to Registration

    1. Document Requirements:
      • PAN and Aadhaar of all directors.
      • Proof of address for both directors and the company (rental agreement, utility bills, etc.).
      • Digital Signature Certificate (DSC) for directors.
    2. Name Reservation:
      • Apply to the Ministry of Corporate Affairs to reserve a unique company name. This is done using the SPICe+ (Simplified Proforma for Incorporating Companies Electronically) Part A.
    3. Drafting MOA and AOA:
      • Memorandum of Association (MOA): Outlines the company’s objectives and scope of operations.
      • Articles of Association (AOA): Governs the company’s internal management.
    4. Filing Incorporation Application:
      • Submit the SPICe+ Part B form along with MOA and AOA to the ROC.
      • Articles of Association (AOA): Governs the company’s internal management.
    5. Certificate of Incorporation:
      • Upon approval, the ROC issues a Certificate of Incorporation, officially recognising the company.

    The process usually takes 10–15 working days, provided all documents are in order.

    {{pvt-cta}}

    Key Features of Private Limited Company

    Here are some Private limited company features:

    • Ownership Structure: Owned by shareholders, managed by directors (who can also be shareholders).
    • Liability of Shareholders: Limited to the amount of unpaid shares they hold.
    • Capital Requirements: There is no minimum capital requirement; businesses can start with as little as ₹1 lakh authorised capital.
    • Perpetual Succession: The company exists independently of its owners' or directors' status.
    • Limited Liability: Shareholders’ liability is restricted to the amount invested.
    • Ease of Fundraising: Can raise capital from angel investors, venture capitalists, or private equity.
    • Tax Implications: Subject to corporate tax rates, including additional surcharges and cess, based on annual income.

    What is a One Person Company?

    Introduced under the Companies Act of 2013, a One Person Company (OPC) is a simplified corporate structure designed for solo entrepreneurs.

    As the name suggests, it allows a single individual to own and operate a business while enjoying the benefits of limited liability and corporate status. OPCs are particularly suited for small businesses, consultants, and freelancers who want to step up from a sole proprietorship and gain a formal business identity.

    The OPC structure is a bridge between sole proprietorship and private limited companies. It combines the flexibility of running a solo business with the legal and financial protections of a company, making it a popular choice for first-time entrepreneurs.

    One Person Company Registration

    The process is designed to be straightforward and entrepreneur-friendly, ensuring that individuals can easily transition from a sole proprietorship or informal business setup to a legally recognised company.

    Step-by-Step Guide to Registration

    1. Document Requirements:
      • PAN, Aadhaar, and proof of address of the sole shareholder/director.
      • Nominee details.
      • Digital Signature Certificate (DSC).
    2. Name Reservation:
      • Reserve a unique name for the OPC via the MCA portal through SPICe+ Part A.
    3. Filing Application:
      • Submit the incorporation form, i.e. SPICe+ Part B with MOA and AOA, to the ROC.
    4. Certificate of Incorporation:
      • Receive the Certificate of Incorporation after approval.

    {{opc-cta}}

    Key Features of OPC

    Here are some One person company features:

    • Ownership Structure: The ownership is held by one individual, with the provision to nominate another person as a successor in case of the owner’s demise.
    • Liability of the Shareholder: The shareholder’s liability is limited to the unpaid value of their subscribed capital.
    • Capital Requirements: There is no minimum capital requirement, making it easier for individuals to start with minimal resources.
    • Ease of Formation: Streamlined setup and management processes.
    • Lower Compliance Costs: Fewer filings and regulatory requirements.
    • Limited Liability: Protects personal assets.
    • Tax Implications: OPCs are subject to the same corporate tax rates as Private Limited Companies. However, they enjoy lower compliance costs and simplified tax filings.

    Similarities between OPC and Private Limited Company

    1. Limited Liability Protection: Both structures ensure the owner’s liability is restricted to their investment.
    2. Legal Entity: Both are considered separate legal entities distinct from their owners.
    3. Compliance with ROC: Both require periodic filings with the Registrar of Companies.
    4. Taxation: Both are subject to corporate tax rates.

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    Our package includes:

    • Company Name Registration
    • 2 Digital Signature Certificates (DSCs)
    • 2 Directors’ Identification Numbers (DINs)
    • Certificate of Incorporation(COI)
    • MoA & AoA [Applicable for Private Limited Companies and OPCs]
    • LLP Agreement [Applicable for LLPs]
    • Company PAN & TAN

    *Prices and documents can differ based on the company type.

    Which company type to register your business with?

    Before commencing the registration process for either a OPC or a Private Limited company, it is essential to carefully assess the following factors.

    1. Consider the Nature and Size of Your Business

    • Evaluate the nature and size of your business. If your operations are on a smaller scale and you are a single operator, opting for OPC registration may be advantageous. Conversely, for larger businesses with substantial employee numbers and capital needs, registering as a Private Limited Company offers greater flexibility in capital raising.

    2. Fundraising Requirements

    • Assess your fundraising requirements. If your objective is to raise funds through equity, opting for a company structure is essential. However, if you can fundraise through debt options, the OPC structure may work.

    3. Compliance Requirements

    • Generally, OPCs have fewer compliance requirements compared to Private Limited Companies, making them more suitable for small businesses. Nonetheless, ensure that you are aware of several post-incorporation compliances that come along with each business structure and choose accordingly.

    Know Your Ideal Company Type

    For the first time in India, answer a brief set of questions about your startup, and our tool "Know Your Company Type" will utilize your responses to pinpoint the ideal company registration type.

    Discover your perfect fit with a single click!

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    Explore side-by-side comparisons of popular company types with prices to help you give a clear picture of the nuances involved with different legal structures.

    Conclusion

    Choosing between a Private Limited Company and a One Person Company depends on your business needs.

    If you’re a solo entrepreneur who clearly focuses on managing things independently and prefers minimal compliance requirements, an OPC can be a great option. It’s a straightforward structure, perfect for freelancers, consultants, or small-scale businesses who want the advantages of limited liability while keeping things simple.

    However, if you’re building a business with big dreams, such as attracting investors, scaling operations, or entering international markets, a Private Limited Company might be a better fit.

    When making this decision, it’s essential to consider not only where your business is today but also where you want it to be in the future. Think about:

    • Your business goals: Are you aiming for steady income or scaling into new markets?
    • Your growth plans: Will you need external funding or partners?
    • Your resources and bandwidth: Can you manage the compliance requirements of a Private Limited Company, or is a simpler structure better suited for now?

    Explore side-by-side comparisons of popular company types with prices to help you give a clear picture of the nuances involved with different legal structures.

    Frequently Asked Questions

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    Register your business
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    Register your business

    Private Limited Company
    (Pvt. Ltd.)

    1,499 + Govt. Fee
    BEST SUITED FOR
    • Service-based businesses
    • Businesses looking to issue shares
    • Businesses seeking investment through equity-based funding


    Limited Liability Partnership
    (LLP)

    1,499 + Govt. Fee
    BEST SUITED FOR
    • Professional services 
    • Firms seeking any capital contribution from Partners
    • Firms sharing resources with limited liability 

    One Person Company
    (OPC)

    1,499 + Govt. Fee
    BEST SUITED FOR
    • Freelancers, Small-scale businesses
    • Businesses looking for minimal compliance
    • Businesses looking for single-ownership

    Private Limited Company
    (Pvt. Ltd.)

    1,499 + Govt. Fee
    BEST SUITED FOR
    • Service-based businesses
    • Businesses looking to issue shares
    • Businesses seeking investment through equity-based funding


    One Person Company
    (OPC)

    1,499 + Govt. Fee
    BEST SUITED FOR
    • Freelancers, Small-scale businesses
    • Businesses looking for minimal compliance
    • Businesses looking for single-ownership

    Private Limited Company
    (Pvt. Ltd.)

    1,499 + Govt. Fee
    BEST SUITED FOR
    • Service-based businesses
    • Businesses looking to issue shares
    • Businesses seeking investment through equity-based funding


    Limited Liability Partnership
    (LLP)

    1,499 + Govt. Fee
    BEST SUITED FOR
    • Professional services 
    • Firms seeking any capital contribution from Partners
    • Firms sharing resources with limited liability 

    Frequently Asked Questions

    What are the documents required for Private Limited Company Registration

    To register a Private Limited Company (PVT Ltd) in India, the following documents are typically required:

    1. For Directors and Shareholders:
      • PAN Card: Mandatory for all Indian citizens involved in the company.
      • Identity Proof: Passport, Aadhaar card, voter ID, or driving license.
      • Address Proof: Bank statement, electricity bill, or any government-issued document not older than two months.
    2. For Registered Office Address:
      • Rent/Lease Agreement: If the office is rented.
      • NOC (No Objection Certificate): From the property owner.
      • Utility Bills: Electricity or water bill (not older than two months).
    3. Photographs:
      • Passport-sized photos of directors and shareholders.
    4. Digital Signature Certificate (DSC):
      • Required for all directors to file forms online.

    Can an Indian citizen living abroad from a One Person Company (OPC)?

    Yes, an Indian citizen living abroad can form a One Person Company (OPC) in India, but with certain conditions:

    • The person must be an Indian citizen and a Resident of India, as per the Companies Act, 2013.
    • Resident of India means the individual has stayed in India for at least 120 days in the preceding financial year.

    If an Indian citizen living abroad doesn’t meet this residency requirement, they cannot form an OPC but may explore alternative structures like a Private Limited Company, which allows for non-resident directors and shareholders.

    Is Foreign Direct Investment (FDI) allowed for a One Person Company?

    No, Foreign Direct Investment (FDI) is not allowed in a One Person Company (OPC) under the automatic route. OPCs are restricted to Indian citizens and residents, and allowing FDI would contradict this principle.

    For businesses looking to attract foreign investment, registering as a Private Limited Company is the better option.

    What is the process of converting a Private Limited Company to an OPC?

    Currently, the Companies Act of 2013 does not allow the conversion of a Private Limited Company into a One Person Company (OPC). However, if the business scale reduces and fewer directors/shareholders are required, the owners may dissolve the Private Limited Company and incorporate an OPC.

    When to convert an OPC to a Private Limited Company?

    As per the Companies Act of 2013, a One Person Company (OPC) must be converted into a Private Limited Company (PVT Ltd) in the following scenarios:

    1. When the Paid-Up Capital Exceeds ₹50 Lakhs:
      • If the capital crosses ₹50 lakhs, the OPC must be converted into a PVT Ltd company within six months.
    2. When the Annual Turnover Exceeds ₹2 Crores:
      • If the turnover of the OPC exceeds ₹2 crores in the previous three consecutive financial years, conversion is mandatory.

    Steps for Conversion:

    • Pass a special resolution in the OPC for conversion.
    • File necessary forms with the Ministry of Corporate Affairs (MCA), such as INC-5 and INC-6.
    • Update the Memorandum of Association (MoA) and Articles of Association (AoA) to align with the requirements of a Private Limited Company.

    Voluntary Conversion:

    If the OPC owner wishes to scale the business, raise funds, or bring in multiple shareholders, they can also opt for voluntary conversion without waiting for mandatory thresholds.

    How to Register a Production House or Media Company in India in 2025?

    How to Register a Production House or Media Company in India in 2025?

    Starting a production house or media company in India can be a thrilling venture- whether you dream of making films, binge-worthy web series, catchy ad campaigns, soulful music videos, or the next big OTT hit, the possibilities are endless.

    But here’s the truth- great ideas alone don’t pay the bills or win investor trust. In this industry, your creative spark must be backed by strong legal, financial, and operational groundwork.

    From choosing the right business structure to securing your brand, protecting your scripts, and joining the right industry bodies, every step you take builds the foundation for a production house that’s not only creative but also credible and future-ready.

    This blog walks you through the legal, financial, and operational requirements for registering and running a production house in India.

    Table of Contents

    Choose the Right Business Structure for Your Film Production Company

    Your first decision is choosing the right legal entity. This impacts ownership, liability, taxation, funding, and compliance. Here’s how the most common options compare:

    Private Limited Company

    • Best choice for media companies aiming to scale, raise investment, or partner with OTT platforms.
    • Offers limited liability protection, higher brand credibility, and Foreign Direct Investment (FDI) eligibility.
    • Easier to bring in shareholders and attract funding from production partners or venture capital.

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    LLP (Limited Liability Partnership)

    • Suitable for small-to-mid scale production outfits.
    • Combines the flexibility of a partnership with limited liability protection.
    • Compliance is lower than that of a Private Limited Company but is still not as investor-friendly.

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    Partnership Firm

    • Easy to set up but offers unlimited liability, meaning partners’ personal assets may be at risk.
    • Limited in terms of scalability and investor trust.

    While an OPC (One Person Company) works well for solo ventures, it restricts ownership expansion and isn’t ideal for scaling or attracting investors. A Sole Proprietorship, though simple to set up, comes with unlimited personal liability and lacks credibility. So, both structures are generally not preferred for a growing film or media business aiming for scalability, credibility, and investor interest.

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    Register the Production House as a Legal Entity

    Once you choose your structure, follow these steps:

    1. Obtain DSC for directors/partners.
    2. Reserve your company name via the MCA portal.
    3. Draft and file the MoA & AoA (for companies) or LLP Agreement.
    4. File incorporation documents with the MCA.
    5. Receive Certificate of Incorporation (COI), PAN, and TAN.

    Register the Brand and Logo as a Trademark

    Your production house’s name and logo are powerful brand assets that set you apart in a competitive entertainment industry. Protecting them early ensures that no one else can misuse your identity or ride on your hard-earned reputation.

    Steps:

    1. Trademark Search – Visit the IP India portal to check if a similar name or logo already exists.
    2. Class Selection – Most media companies file under Class 41 (entertainment services) and Class 38 (broadcasting), but additional classes may apply based on your services.
    3. File TM Application Online – Submit your application with the required documents and fees.
    4. Examination & Objections – The Trademark Registry will review your application; be prepared to respond to any objections or clarifications.
    5. Final Registration – Once approved, your trademark is valid for 10 years and can be renewed indefinitely, ensuring long-term brand protection.

    Get Copyright Registration for Original Works

    In the media business, your creative works- films, scripts, songs, storyboards, promotional videos- are valuable. Copyright registration legally secures these works, giving you the exclusive right to reproduce, distribute, adapt, and monetise them.
    Steps: 

    • Apply online at the Copyright Office website.
    • Submit the required documents (work details, creator’s info, soft copies).
    • Pay the applicable fee.
    • Wait for scrutiny and the issuance of the certificate.

    Join a Film Producers Association

    Organisations like the Indian Motion Picture Producers' Association (IMPPA), Film Producers Association of India (FPAI), and Western India Film Producers Association (WIFPA) provide legal backing, industry recognition, and a platform for networking.

    Benefits include:

    • Access to legal advice and dispute resolution services
    • Opportunities for co-productions and collaborations
    • Industry events and workshops to stay updated on trends and regulations
    • Collective bargaining power and advocacy on industry matters

    To join, submit your company incorporation documents and proof of work (films, scripts, or projects). Complete the membership application process as per the association’s guidelines and pay the prescribed membership fees. 

    Open a Current Account in Your Company’s Name

    A current account is essential for managing your production house’s day-to-day financial transactions smoothly and professionally. Unlike a regular savings account, a current account offers higher transaction limits and facilities tailored for businesses, such as overdraft options and multiple signatories.

    Documents Required:

    • Certificate of Incorporation (COI)
    • PAN card of the company
    • Memorandum of Association (MoA) and Articles of Association (AoA)
    • KYC documents of directors (identity and address proof)
    • Proof of registered office address

    Consider banks that offer robust digital banking platforms, ease of fund transfers, and competitive transaction charges. Also, check for value-added services like merchant accounts for receiving payments, foreign currency transactions, and working capital loans.

    Get GST Registration and Import Export Code (IEC)

    For production houses and media companies, GST registration is mandatory if your annual turnover exceeds the prescribed threshold (₹20 lakh or ₹40 lakh, depending on your state). GST compliance helps you claim input tax credits, maintain transparency, and avoid legal penalties.

    If you work with international clients, monetise content on platforms like YouTube, or export your services globally (e.g., selling films or digital content overseas), obtaining an Import Export Code (IEC) is essential. IEC is issued by the Directorate General of Foreign Trade (DGFT) and acts as a license to conduct cross-border trade legally.

    How to Apply:

    • GST Registration can be done online via the GST portal by submitting PAN, business details, and bank information.
    • IEC application is filed online on the DGFT portal, linked to your PAN, with processing typically completed within a few days.

    Get Music, Scripts, and Third-Party IP Licenses

    In the media and production industry, using music, scripts, or other creative content created by others requires proper licensing to avoid legal issues.

    Common Types of Licenses:

    • Sync License: Allows you to synchronise music with visual media like films or ads.
    • Master License: Grants permission to use the original sound recording.
    • Adaptation Rights: Needed if you plan to remake, translate, or modify existing works.

    Key Licensing Bodies in India are IPRS (Indian Performing Right Society) & PPL (Phonographic Performance Limited).

    Protect Digital Content and Manage Online Rights

    In today’s digital age, safeguarding your media company’s content online is as important as creating it. With piracy and unauthorised sharing rampant, implementing strong digital protection measures helps you retain control and monetise your work effectively.

    Here are a few ways you can protect and manage your digital content: 

    • Digital Rights Management (DRM): Technology that restricts how digital content is accessed, copied, or shared, ensuring only authorised users can view or distribute your work.

    • Content ID Systems: Platforms like YouTube use automated systems to identify copyrighted content and manage its use, including monetisation or takedown.

    • Watermarking and Metadata Tagging: Embedding invisible or visible markers in your videos or music that trace the content back to you, deterring theft and helping prove ownership.
    • DMCA Takedown Notices: Legal requests to platforms to remove unauthorised copies of your content.

    Frequently Asked Questions (FAQs)

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    Private Limited Company
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    1,499 + Govt. Fee
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    • Service-based businesses
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    Limited Liability Partnership
    (LLP)

    1,499 + Govt. Fee
    BEST SUITED FOR
    • Professional services 
    • Firms seeking any capital contribution from Partners
    • Firms sharing resources with limited liability 

    One Person Company
    (OPC)

    1,499 + Govt. Fee
    BEST SUITED FOR
    • Freelancers, Small-scale businesses
    • Businesses looking for minimal compliance
    • Businesses looking for single-ownership

    Private Limited Company
    (Pvt. Ltd.)

    1,499 + Govt. Fee
    BEST SUITED FOR
    • Service-based businesses
    • Businesses looking to issue shares
    • Businesses seeking investment through equity-based funding


    One Person Company
    (OPC)

    1,499 + Govt. Fee
    BEST SUITED FOR
    • Freelancers, Small-scale businesses
    • Businesses looking for minimal compliance
    • Businesses looking for single-ownership

    Private Limited Company
    (Pvt. Ltd.)

    1,499 + Govt. Fee
    BEST SUITED FOR
    • Service-based businesses
    • Businesses looking to issue shares
    • Businesses seeking investment through equity-based funding


    Limited Liability Partnership
    (LLP)

    1,499 + Govt. Fee
    BEST SUITED FOR
    • Professional services 
    • Firms seeking any capital contribution from Partners
    • Firms sharing resources with limited liability 

    Frequently Asked Questions

    What is the minimum number of directors required to register a film production company in India?

    • For a Private Limited Company, the minimum is 2 directors.
    • For an LLP, at least 2 partners are required.

    What is the validity of the certificate of incorporation for a film production company in India?

    The Certificate of Incorporation (COI) does not expire. It is a lifetime proof of your company’s legal existence unless the company is dissolved or struck off.

    What is the average time taken to complete the registration process for a film production company in India?

    Typically, it takes about 7 to 15 working days from filing the incorporation documents to receiving the Certificate of Incorporation, depending on the completeness of documents and MCA processing times.

    What documents are required to register a film production company in India?

    • Identity and Address Proof of directors/partners (Aadhaar, Passport, Voter ID, Driving License)
    • PAN Card of directors/partners
    • Proof of Registered Office Address (rental agreement or utility bill)
    • No Objection Certificate (NOC) from the property owner (if rented)
    • Passport-sized photographs of directors/partners
    • Digital Signature Certificate (DSC)

    What are the risks of not registering a trademark or copyright?

    • Loss of exclusive rights over your brand name, logo, or creative works
    • Increased risk of brand infringement or piracy by competitors
    • Difficulty in legally enforcing your ownership and protecting your content
    • Potential loss of business reputation and revenue from unauthorised use

    Mukesh Goyal

    Mukesh Goyal is a startup enthusiast and problem-solver, currently leading the Rize Company Registration Charter at Razorpay, where he’s helping simplify the way early-stage founders start and scale their businesses. With a deep understanding of the regulatory and operational hurdles that startups face, Mukesh is at the forefront of building founder-first experiences within India’s growing startup ecosystem.

    An alumnus of FMS Delhi, Mukesh cracked CAT 2016 with a perfect 100 percentile- a milestone that opened new doors and laid the foundation for a career rooted in impact, scale, and community.

    Read more
    Types of Trademark: A Comprehensive Guide

    Types of Trademark: A Comprehensive Guide

    A trademark is a unique identifier, such as a word, symbol, or design, that distinguishes the goods or services of one business from another. It plays a vital role in helping consumers identify the origin of products or services, ensuring authenticity and trust. 

    There are different types of trademarks, including product marks, service marks, collective marks, and more. Each type serves a specific purpose, offering businesses a way to protect their intellectual property and enhance brand recognition. This article will explore the various categories of trademarks, their significance, and how they can be applied to businesses.

    Table of Contents

    Product Mark

    A product mark is a kind of trademark used exclusively on goods, helping consumers identify the origin of the product and ensuring its authenticity. It plays a crucial role in distinguishing one business's goods from another, contributing to brand recognition and reputation.

    Product marks fall under trademark classes 1 to 34, which categorise various types of goods, including chemicals, machinery, and textiles. For example, the "Nike" logo on shoes is a product mark that signifies the brand's origin and quality. 

    Service Mark

    A service mark is a trademark used to distinguish one business's services from those offered by others. Unlike product marks, which apply to goods, service marks highlight the origin and quality of services, helping customers identify and trust a particular service provider.

    These marks typically fall under trademark classes 35 to 45, covering various services such as advertising, financial services, and hospitality. For instance, the "Taj Hotels" emblem represents a service mark that signifies premium hospitality services. 

    Collective Mark

    A collective mark is a type of trademark used to identify goods or services offered by members of a group, association, or institution. It ensures that the products or services meet specific quality or ethical standards set by the organisation holding the mark.

    These marks distinguish the collective efforts of a group rather than an individual business. For example, the Chartered Accountant (CA) designation in India serves as a collective mark in trademark, representing professionals certified by the Institute of Chartered Accountants of India (ICAI).

    Certification Mark

    A certification mark is a symbol used to certify that a product meets specific standards related to origin, material, quality, or manufacturing methods. It guarantees that the certified product complies with established benchmarks, regardless of the owner’s business.

    Certification mark examples include the "ISI" mark on electrical appliances and the "Agmark" label on food products in India, both of which assure consumers of quality and safety. Such marks are commonly found on food, electronics, and toys.

    Shape Mark

    A shape mark protects the distinctive shape of a product, enabling consumers to associate it with a specific brand. It ensures that unique designs contributing to a product's identity remain exclusive to the brand. For instance, the iconic contour shape of Coca-Cola bottles and the unique design of Fanta bottles are classic examples of shape marks that enhance brand recognition and trust.

    Pattern Mark

    A pattern mark protects distinctive designs or patterns used on a product to set it apart from competitors. To qualify, the pattern must be unique and easily recognisable—generic or common patterns are often rejected. For example, the well-known Burberry check pattern on their clothing and accessories is a classic pattern mark that helps identify the brand.

    Demonstrating the uniqueness of the pattern is essential for successful registration, as it ensures the design remains exclusive to the brand, reinforcing its identity in the market.

    Sound Mark

    A sound mark is a unique audio signature linked to a product or service, allowing consumers to identify its origin through sound. It plays a significant role in branding, often used as an audio mnemonic in advertisements. A well-known example in India is the IPL tune, which instantly evokes recognition of the Indian Premier League.

    Arbitrary and Fanciful Trademarks

    Arbitrary and fanciful trademarks are distinct categories that stand out for their unique qualities. A fanciful mark is a made-up term or word with no prior meaning, making it highly distinctive and easy to register. For example, "Google" and "Kodak" are fanciful marks, as these words were coined specifically for the brands and have no inherent connection to their respective products.

    On the other hand, an arbitrary mark uses a commonly known word but has no direct relation to the product or service it represents. "Apple," for instance, is an arbitrary mark since it’s a well-known word but doesn’t link directly to computers or electronics. 

    Geographical Indications (GI)

    A Geographical Indication (GI) is not a type of trademark but a separate form of intellectual property protection. It denotes a product’s specific geographic origin and assures consumers of its quality or reputation linked to that region. GIs help preserve the uniqueness of products tied to their location. For example, "Darjeeling Tea" and "Banarasi Silk" are GIs that signify the products’ origins and qualities unique to those regions.

    How to Choose the Right Type of Trademark?

    1. Assess the Nature of Your Product/Service

      Determine the characteristics and qualities of your product or service. Understanding its nature helps in choosing the appropriate trademark type. For instance, if your product has a unique shape or design, a shape mark could be suitable. If your service stands out for its quality or reputation, a service mark might be more fitting.
    1. Focus on Branding Goals and Industry Standards

    Consider your branding goals—whether you aim to build recognition, guarantee quality, or differentiate your offering. Also, take into account industry practices.

    For instance, if you're part of a group or association, a collective mark might be more suitable, whereas a certification mark may be necessary for products requiring quality assurance. Ensure that the trademark aligns with your long-term branding strategy.

    1. Consult a Trademark Expert if Necessary

    If you are uncertain about which trademark suits your business, it’s advisable to consult a trademark expert. They can assess your product or service and guide you on the best trademark type based on legal requirements and market needs. This ensures that your trademark selection is legally sound and provides optimal protection.

    Examples of Trademarks in Action

    1. Food Industry

      Pepsi uses a product mark that consists of its distinctive logo, which is instantly recognisable by its red, white, and blue colour scheme. This trademark is essential in helping customers identify the Pepsi brand in a competitive market filled with various soft drink options. The product mark not only includes the logo but also the unique design of its packaging, ensuring that every Pepsi product stands out on store shelves.
    1. Fashion Industry

    Louis Vuitton has trademarked its iconic monogram pattern as a pattern mark. This pattern, featuring the “LV” logo repeated across their products, is instantly recognisable worldwide. The distinctive design appears on bags, luggage, and other luxury accessories, making it a signature of high-end fashion.

    By using this pattern mark, Louis Vuitton differentiates itself from other brands and maintains its status in the luxury market, ensuring that customers associate the design with quality and exclusivity.

    1. Technology Industry

      The name Microsoft is a suggestive mark. It combines “microcomputer” and “software,” hinting at its products (software for small computers) without explicitly describing them. Suggestive marks require consumers to make a mental connection between the name and the product or service.


    This type of trademark is distinctive while maintaining a subtle association with the brand's offerings, making it a powerful branding tool in the technology sector.

    1. Hospitality Industry

      Marriott International uses a service mark to represent its brand and distinguish its services in the hospitality industry. The service mark covers not only the name “Marriott” but also its reputation for providing high-quality customer service, luxury, and a wide range of hospitality offerings.

    From hotels to resorts, Marriott’s service mark assures customers of a consistent experience, helping the brand stand out in the competitive world of hotels and travel.

    Frequently Asked Questions

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    • Service-based businesses
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    Limited Liability Partnership
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    1,499 + Govt. Fee
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    • Professional services 
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    Frequently Asked Questions

    What are the different types of trademarks?

    The different types of trademarks include product marks, service marks, collective marks, certification marks, shape marks, pattern marks, and sound marks etc. 

    What are 2 examples of a trademark?

    Two examples of trademarks are the "Nike" swoosh logo, representing the brand's sportswear and footwear, and the "Apple" logo, symbolising the technology company's products like iPhones and Macs. 

    What are the different types of IPR?

    Intellectual Property Rights (IPR) include copyrights, trademarks, patents, designs, and geographical indications (GI). These rights help protect the creations and innovations of individuals or businesses, ensuring legal protection and exclusivity.

    What is the full form of TRIPS?

    TRIPS stands for Trade-Related Aspects of Intellectual Property Rights. It is an international legal agreement that sets minimum standards for protecting and enforcing intellectual property rights across countries.

    How to register a product mark in India?

    To register a product mark in India, you need to select a trademark agent (if not based in India), choose a distinctive mark and relevant class, and conduct a search for availability. Then, file the application with the required documents and fees. The application will be examined, published for opposition, and, if no objections arise, it will be registered for 10 years.

    Benefits of having a service mark for your business

    A service mark helps protect your business’s identity and reputation in the market. It distinguishes your services from competitors, boosts consumer confidence, and provides legal protection against imitation. 

    What is a collective mark and how does it work?

    A collective mark is a trademark used by members of a group, association, or organisation to signify that the goods or services meet certain standards the collective owner sets. It helps distinguish products or services from those of non-members, ensuring quality and origin.

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