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Memorandum of Association and Article of Association


Memorandum of Association is a legal documents for incorporation of a company.

Memorandum of association is a fundamental legal document on the basis of which the company conducts its external affairs. This document signifies the powers of the company as well as limitation of the company. It contains information regarding the purpose, capital place of business liability of the members and acquisition of shares by the subscribers.

Contents of Memorandum of Association sec- 16, 17, 18:

  • Name of province in which the registered office of the company is to be located.
  • Objectives of the company
  • Liability of the members—limited or unlimited.
  • Authorized capital

Requirements of Memorandum of Association:
- Required to be printed. It should be in printed form
- It should be divided into paragraphs.
- Paragraphs should be numbers
- To be signed by the subscribers/applicants
- Signatures duly witnesses by at least one witness.
- Complete address/occupation of the subscribers to be mentioned.
- Address, occupation of the witness to be mentioned.
- Memorandum to be duly stamped under Stamp ACT

Article of Association

It is doctrine of indoor management. An article of Association contains following information’s:-
It contain definition of important terms
It contain information regarding procedure for Issuance of shares and allotment of shares.
What is share capital, rights of shareholders?
It contain information regarding transfer of shares
It contain information’s regarding alteration of share capital
What is dividend policy of company, how it will be distributed
It contain information’s regarding appointment of Directors, election, removal, powers and duties of directions.
Meetings, voting, powers
Borrowing powers of company
Accounts and audit system of company
Winding up
Difference between Memorandum of Association and Article of Association
Memorandum of Association
It is a fundamental legal documents
It is the constitution of the company in relation to outside world
Memorandum constitutes the conditions upon which the company is granted incorporation
Memorandum can be altered only in accordance with provision of Ordinance
Memorandum gives rise to the contract between the company and the outside world
Article of Association
It is a fundamental legal documents but it subordinate to memorandum of association
It is doctrine of indoor management
These are internal rules and regulation of the company
Alteration can be made through a special resolution by the company.
Articles do not contract between the company and the outside world.

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