In the third of a series of articles, to be published in De Rebus magazine, regarding the implications of new Companies Act of 2008, Paul Descroizilles, briefly discusses the nature and content of the memorandum of incorporation (hereafter referred to as the “MOI”).
Under the current Companies Act a company must have a memorandum of association and a memorandum of articles, which documents generally regulate the relationship between the company and its members. Both the form and contents of the memorandum of association is prescribed by the current Act, but not the contents of the memorandum of articles. Therefore, it has become a common practice for shareholders of companies change these documents by special resolution and / or to enter into shareholders agreements over-riding the memorandum of association and memorandum of articles.
Under the new Companies Act, however the memorandum of association and memorandum of articles have been replaced by one comprehensive document, the MOI. The form, contents and changes to this document are regulated by the new Act, which aims to eradicate shareholders creating conflicting provisions between that and any other contract or document, ensuring transparency and legal certainty, among other benefits, within the company structure.
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