The memorandum no longer restricts the activities of a company. If, since 1 October 2009, the articles of association of a company contain restrictions on the subject matter, these restrictions shall form an integral part of the articles of association. The main purpose of the memorandum is to explain the company`s field of activity. Potential shareholders know the areas in which the company invests its money and the risk they take in investing the money. Historically, a company`s articles of association contained an object clause that limited its ability to act. When the first joint-stock companies were created, the object clause had to be defined in a broad sense so as not to restrict the board of directors in its day-to-day operations. The Companies Act 1989 introduced the term « general commercial company », which means that companies can engage in « any lawful or legal business or enterprise ». « Memorandum of association. Merriam-Webster.com Dictionary, Merriam-Webster, www.merriam-webster.com/dictionary/memorandum%20of%20association. Retrieved January 5, 2022. provides that, if the articles of association so permit, « a public limited company may, by an ordinary resolution adopted at the general meeting, amend the terms of its memorandum on capital so that the association clause confirms that the shareholders bound by the MEMORANDUM OF UNDERSTANDING voluntarily join and form a company. You need seven members to sign a memorandum of understanding for a publicly traded company, and no less than two people for a memorandum of understanding from a private company. You must make the signature in the presence of a witness, who must also attach his signature.

The absence of this clause in the memorandum means that the liability of its members is unlimited. A company`s corporate memorandum is an important corporate document in some jurisdictions. We often simply talk about a memorandum. In the UK, it must be submitted to the Registrar of Companies during the process of setting up a business. It is the document that regulates the external affairs of the company[1], and complements the articles of association that cover the internal constitution of the company. It contains the basic conditions under which the company can operate. Until recently [Where?], it had to include the « object clause » that allowed shareholders, creditors and persons involved in the company to know what its authorized field of activity was, although it was generally very broad. It also shows the initial capital of the company.

It is one of the documents required to set up a business in India, the United Kingdom[2], Ireland, Canada, Nigeria, Nepal, Bangladesh, Pakistan, Afghanistan, Sri Lanka and Tanzania, and is also used in many Commonwealth common law jurisdictions. [3] The last word on behalf of the Corporation, if limited by shares or security, is « limited » unless the Corporation is registered as a « not-for-profit association. » It is essentially a statement that policyholders intend to incorporate a company under the Companies Act 2006, have agreed to become members and, in the case of a company that must have share capital, to take at least one share at a time. It is no longer necessary to remember the name of the company, the type of company (e.B. Public limited company or joint-stock company), indicate the registered office of its registered office, the purpose of the company and its authorized share capital. [5] Instead, this information appears exclusively in legislation. Companies incorporated before 1 October 2009 are not required to amend their memoranda and, for such companies, the provisions which would have been included in the instrument of incorporation but which must now be included in the articles of association, such as the object clause and the details of the share capital, apply in the context of the articles of association. The social memorandum is the most important document that must be formulated with the utmost care. It is the document that governs the relationship between the company and the outside world. The Memorandum of Association serves as the incorporation of the company, which defines all the rules and regulations that must be respected by each company. It is mandatory for any company wishing to register as a private/public limited liability company to prepare the Association Protocol. « The company memorandum of a company is the charter and defines the limitation of the power of the company established in accordance with the law. » The social memorandum contains the objectives and areas of action that need to be covered in the long term.

It also functions as a constitution and a last resort to solve the complexity of internal management in the company. It is still necessary to file a statute to create a new company[4], but it contains less information than before 1 October 2010. The Companies (Registration) Regulations 2008 contained pro forma memoranda. Once the document is created, the company cannot do anything more than the limit specified in the articles of association. Therefore, it is considered the supreme document and includes the following important clauses: A company may modify the conditions contained in the memorandum only in the cases and in the manner and to the extent expressly provided for by law. .