PRC-3 · Chapter 2 · Question 37 of 61
Mr. Ahmed registers his new consultancy firm legally as a Single Member Company (SMC). Later, he wants to add his brother as a second equal shareholder to the SMC. Is this legally permissible while maintaining the SMC status?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) No, an SMC strictly consists of only one single shareholder
Explanation
By legal definition, a Single Member Company (SMC) is a class of private company that has exactly one member/shareholder. It cannot have two.
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