FreeComplianceSubscribers vs directors: who owns and who runs a company
In a company, owning and running are separate roles. Subscribers are the first shareholders who sign the MOA and own the company. Directors form the board that manages it. In most startups, the same founders hold both roles, but the law treats them differently.
Side by side
| Subscriber / shareholder | Director | |
|---|---|---|
| Role | Owns shares | Manages the company on behalf of shareholders |
| Minimum (private company) | 2 | 2 |
| Can be a company? | Yes | No, only individuals |
| Needs DIN? | No | Yes |
| Needs DSC at incorporation? | Yes | Yes |
| Key documents | MOA and AOA subscription, INC-9 | DIR-2, INC-9, DIR-8, MBP-1 |
| Liability | Limited to unpaid share amount | Duties under Section 166; personal liability for certain defaults |
Common setups
- Two co-founders who are both subscribers and directors.
- A founder and a parent or spouse as second subscriber, with only the founder plus another as directors.
- A foreign parent company as subscriber, with individuals as directors.
Frequently asked questions
This guide is general information, not legal advice. Government fees and procedures change; confirm current figures before you file.
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