Memorandum of Association of a Company defines the scope of its activities. The MOA contains the following clauses:
Name Clause
Situation Clause
Object Clause
Liability Clause and
Capital Clause
Whenever a company wants to make changes to any of the above clauses, it has to alter the MOA of the Company. Any change to Memorandum of Association (MOA) can be made by passing a Special Resolution at the meeting of Shareholders. In this article, we have discussed reasons and procedure of changing MOA of the Company.
Change of Name of Company
Change of Name of the Company requires alteration of Name Clause of the Company. For change in Name Clause of the Company, a Special Resolution is required in the General Meeting of the Company. Section 13(2) of the Companies Act, 2013 requires the approval of Central Government. Central Government might also ask the Company to change its name if the Company name bears resemblance to existing Company name.
Change of Registered Office – from one state to another
Change of Registered Office from one State to another is a complex process. In the event of a change of Registered Office from one state to another, a Special Resolution has to be passed in General Meeting of the Company and an approval from Company Law Board (CLB) is required. The altered Memorandum of Association must be filed with the Registrar of Companies of the State from which the Registered Office is shifted and also with the Registrar of Companies of the State in which the Registered Office is being shifted. On getting approval, situation clause of the Memorandum of Association may be altered to reflect the name of the new state where the Registered Office is shifted.
Alteration of Object Clause of Memorandum of Association
Alteration of Object Clause of a Private Limited Company can be done easily. A Special Resolution to the effect may be passed in the General Meeting of the Company followed by the filing of the form MGT-14 within 30 days of passing Special Resolution with the concerned Registrar of Companies. However, the process of alteration of object clause of a Public Limited Company which has raised money from the public through prospectus will have to pass a Special Resolution in the Shareholders’ meeting and publish the same in a newspaper in English and regional language. Further, the Promoters should give all the dissenting shareholders an opportunity to exit.
Alteration of Capital clause Memorandum of Association
Authorised Capital of the Company may be increased by passing a Special Resolution in the General Meeting of the Company and filing required forms with the Registrar of Companies. When a Company wants to issue new shares, the company has to look at its Authorised Capital as it cannot issue shares in excess of its Authorised Capital. If required, the company may increase the authorized capital of the company.