Memorandum of Association (for a Pakistani Company)

Memorandum of Association

·         The promoters of the company prepare the memorandum of association

·         It is the most important document of the company.

·         It is the charter of the company and defines it s power s and states its objectives.

The mandatory contents of the memorandum of association are as follows:

1. The name clause

The name clause must include:
a ) The word “Limited” as the last word in case of a Public Limited Company.
b) The words “(Private) Limited” as the last words in the case of a Private Limited Company.
c) The words “(SM C-Private) Limited” as the last words of a Single Member Private Limited Company.

2. Registered Office Details

This clause must stat e the address details of the company offices.

3. Object Clause

This is the most important part of the memorandum of association and is to be worded immensely carefully. A company cannot legally take up any business that is not authorised by its object clause. The object clause cannot contain any thing contrary to the provisions of the Companies Ordinance, 1984. It is generally very lengthy and the scope of the company’s activities is widened by including the words “and the doing of all such other things incidental or conductive of the environment of the above objects.”

4. Liability Clause

The clause must include whether the company is limited by share or guarantee. The effect of this statement is in the event if the company is wound up, the members of the company will not be liable to contribute more than the amount, if any, unpaid on their shares, in case of a company limited by shares. In the case of a company limited by guarantee, the members undertake to contribute a specific amount to the assets of the company.

5. Share Capital Clause

The following information is provided in this clause, except for guarantee companies having no share capita l and unlimited companies :

a ) The amount of share capita l with which the company is formed and registered.
b) The division of share capital into shares of fixed amounts.

The memorandum of association must be signed by the subscribers i.e. the first member s of the association.