A PLC, or public liability company, is a company that offers shares to the public. It is a limited liability company operating in Commonwealth jurisdictions, such as the United Kingdom or the Republic of Ireland. PLCs should not be confused with a public company, which is also referred to as a publicly traded company.
PLCs may be listed on stock exchanges; however, they can be unlisted. According to UK company law, public liability companies must specify they are such in their names, either written out or with the initials PLC.
In the UK, Companies House will issue a new public liability company a certificate prior to the start of business. Companies House is an agency of the Department for Business Innovation and Skills. In other countries, PLCs receive a certificate from similar agencies with different names, such as Registrar of Companies in Northern Ireland, the Companies Registration Office in the Republic of Ireland, and Malta Financial Services Authority (or MFSA) in Malta.
The PLC is required to have a minimum of ₤50,000 in shares at the time of making the request, and twenty-five percent of each share must be paid in cash. At the low end, a new PLC will have a cash amount of ₤12,500 with ₤37,500 still owed.
One of the main reasons that companies choose to go public, rather than remain private, is because of a PLC’s ability to advertise shares and sell them through the stock exchange. The shareholders are not held responsible for the debts of the company and have limited liability. Additionally, PLCs have an easier time borrowing money from the bank, and it’s often at cheaper rates than other business types.
There are some disadvantages to choosing a public limited company, including cost. PLCs risk being bought out by rivals who have purchased shares.
There are many vehicles available for your offshore business, and choosing the right one for your needs requires research an assistance from a knowledgeable agent.