Memorandum of Association
A company’s memorandum of association, often simply called the “Memorandum”, is the document that governs relations between the company and the outside world. It serves as the constitution of the company. It is a public document and may be inspected by anyone, usually at the public office where it is lodged. The structure and formulation of Joint Stock Company are made on the basis of the memorandum of association.
The memorandum of association of a company states the company name and aims to out the main and subsidiary objectives of the company. In this document, the external or internal rules and regulations related to the operation of the business are stated. Terms and conditions to formulate the company and the regions of operation are mentioned in these documents. A company is not able to or has no right to go beyond its region. It must be signed by at least seven persons in case of a public limited company and by two persons in case of a private limited company.
We will see some renowned definitions of the memorandum of association which are as follows:
Companies Act 1994: Memorandum of Association is not being mentioned properly. But in section; 2(1) it to said, “Memorandum means the memorandum of Association of a company as originally framed or as altered in pursuance of this act.”
Justice L.J. Brown: “The memorandum contains the fundamental conditions upon which alone the company is allowed to be incorporated. They are condition introduced for the benefit of the creditors and outside public as well as of the shareholders”.
Sen & Matra: “The memorandum of association is a document which contains the fundamental rules regarding the constitution and activities of a company”.
Lord Macmillan: “The purpose of the memorandum is to enable the shareholder, creditors and those who deal with the company to know what is permitted a range of enterprise.”
Overall, a Memorandum of Association (MOA) is a legal document prepared in the formation and registration process of a limited liability company to define its relationship with shareholders. It is accessible to the public and described the company’s name, the physical address of registered office, capital, and liability, names of shareholders and distribution of shares.