Ch # 2.

Memorandum and Articles Page 14

MEMORANDUM OF ASSOCIATION (MOA)

Clauses of MOA

Name Clause

Name of company with following last word

- Public Co: "Limited"
- Private Co: "(Private) Limited"
- Single Member Company “(SMC-Private) Limited”
- Guarantee Ltd "(Guarantee) Limited"
- Unlimited: “Unlimited”

Registered Office Clause

Province or part of Pakistan not forming part of a province

(in which registered office is to be situated)

Principal line of business Clause

§ Principal line of business will be mentioned in MOA

§ It shall be matching with its name

“Principal line of business” means the business in which substantial assets are held or likely to be
held or substantial revenue is earned or likely to be earned by a company, whichever is higher.

§ A company may carry on any lawful business or activity and do any act or enter into any
transaction connected to it which is necessary in attaining its business activities.
§ A company shall not engage in a business which is:
- Prohibited by any law for the time being in force in Pakistan; or
- Restricted by any law, rules or regulations
(unless necessary licence, registration, permission or approval has been obtained)

Existing companies (those registered before Companies Act, 2017 was effective) may continue
with their existing MOA and their object clause be treated as the principal line of business
Ch # 2. Memorandum and Articles Page 15

Liability Clause

Company Limited by Shares

“Liability of the Members is limited”

Company Limited by Guarantee

‘Liability of the members is limited’.

An additional sentence is also added to clarify the extent of liabilities of the members of that
company in the event of its being wound up.

Unlimited Company

“Liability of the Members is unlimited”

Authorised Share Capital Clause

Amount of share capital with which Co proposes to be registered, and the division into shares
of a fixed amount
§ Every subscriber of MOA is required to take at least one share
§ Each subscriber shall write opposite to his name the number of shares he has agreed to
take
§ For company limited by guarantee, this clause shall not be included if company has no
share capital

Undertaking / Subscription Clause

The company shall add an undertaking, as may be specified by SECP.

Subscribers shall
§ Write their names addresses and other required particulars
§ Write following sentence:

“We, the several persons whose names and addresses are subscribed, are desirous of being
formed into a company, in pursuance of the memorandum of association, and we respectively
agree to take the number of shares in the capital of the company set opposite our respective
names”
§ Sign MOA in presence of at least one witness (witness shall also write his particulars)
Ch # 2. Memorandum and Articles Page 16

Printing and signature of MOA & AOA

MOA and Articles shall be

§ Printed
§ Divided into paragraph numbered consecutively
§ Dated
§ Signed by each subscribers giving following details in presence of a witness (who shall
attest signature and add his particulars also)
- Present Name in full
- Occupation
- Nationality
- Usual residential Address
- Others particulars as may be prescribed

Every Co, upon request and payment of a prescribed amount by its member, shall supply within
14 days a copy of MOA & AOA of the company.

Borrowing powers to be part of memorandum

MOA & AOA is deemed to include (implied) power to enter into any arrangement for obtaining
loans, advances, finances or credit, and to issue other securities not based on interest for raising
resources from a scheduled bank, a financial institution or general public
Ch # 2. Memorandum and Articles Page 17

NAMES

Restrictions on Names

Prohibited Names

§ Containing word or expression notified by SECP;

§ Inappropriate, undesirable or deceptive (in the opinion of SECP)
§ Designed to exploit or offend religious sentiments of people.
§ Identical with name of a company already registered
§ Nearly resembling that name of a company already registered

Names which require prior approval of SECP

Prior approval of SECP required if proposed name suggest

§ Patronage of any, past/present, Pakistani/foreign, Head of State
§ Any connection with Federal Govt. or Provincial Govt. or any department or authority of
any such Government;
§ Any connection with any corporation set up by or under any Federal or Provincial law; or
§ Patronage of, or any connection with, any foreign Government or any international
organization.
§ Establishing a modaraba management Co or to float a modaraba
§ Any other business requiring a license from the government

Whenever a question arises as to whether or not the name of a company is in violation of above
provisions, decision of SECP shall be final.

Application for reservation of a name

§ A person may make an application in specified form and manner with a specified fee, to the
registrar for reservation of any name
§ Reservation can be made for a period of maximum 60 days.
§ If it is found that a name was reserved, by furnishing false or incorrect information
- Such reservation shall be cancelled
- The person making application shall be liable to a penalty.
- If the company has been incorporated, it shall be directed to change its name.

§ If application is refused by registrar, aggrieved person may within 30 days of the order of
refusal prefer an appeal to SECP.
§ Order of SECP shall be final and shall not be called in question before any court or authority
Ch # 2. Memorandum and Articles Page 18

Change & Rectification of Name

Rectification of Name

§ If wrong name selected by Co,

- It may change name with the approval of registrar; and
- It shall change name within 30 days if registrar directs so.
§ Registrar shall, before issuing direction for change of name, give Co an opportunity of being
heard
§ If company fails to comply with above direction, registrar may
- Register company under a new name selected by him;
- Issue a certificate of incorporation on change of name; and
- Impose a penalty for non compliance

Change of Name

§ Special Resolution
§ Approval of registrar.

No approval required if addition or deletion of words “(Private), (SMC-Private), (Limited) or

(Guarantee Limited) or (Unlimited)]

Effect of Change of Name

§ Registrar shall enter the new name on register in place of old one.
§ Registrar shall issue a new certificate of incorporation altered to meet the circumstances
§ Continue to mention former name along with its new name outside every business place
and in all documents (for 90 days from date of issue of new certificate)
§ Change of name shall not affect the rights & obligations of Co.
§ Legal proceeding may be continued against Co in new name

Publication of Name

§ Name and incorporation number of every limited company shall be displayed outside
company’s every office or place of business in a conspicuous position.
§ Company shall display a certified copy of certificate of incorporation at every place of
business
§ Name, address of registered office, telephone, fax number, e-mail and website addresses, if
any, shall be mentioned on all documents appeared to be the documents of company.
§ Level 1 Penalty on company and its officers for not displaying name in manner provided.
§ Officer shall be personally liable for debt of company if he issue / authorize any document
without mentioning the name of company (unless debt paid by the company itself)
Ch # 2. Memorandum and Articles Page 19

REGISTERED OFFICE AND PRINCIPAL LINE OF BUSINESS

Registered office of a company

§ It is a single place which is the address of company for receiving all communications.
§ It does not necessarily be same as head office of the company.
§ A company shall have a registered office and its address shall be notified to the registrar
within 30 days of its incorporation.
§ Any change in such address shall be notified to registrar within 15 days of change:
§ Change of registered office to any other city shall also require special resolution

Alteration of Registered Office clause in MOA

§ Company may by special resolution alter its MOA to change its registered office from:
- One Province to another Province or Islamabad Capital Territory and vice versa; or
- One Province or Islamabad Capital Territory to a part of Pakistan not forming part of a
Province and vice versa.
§ Company shall apply to SECP for obtaining its approval
§ When company actually shifts its registered office, it shall inform the registrar within 15
days of the date of such shifting.
§ Where alteration involves a transfer of registered office from jurisdiction of one company
registration office to another, physical record of company shall be transferred to the other
registrar (where the registered office has been shifted)

SECP Approval for alteration

§ SECP must be satisfied that

- Circumstances for alteration of object/registered office exists
- Sufficient disclosure has been given to every creditor and member of the company
§ SECP may make an order confirming alteration either wholly or in part, and on such terms
and conditions as it thinks fit.
§ A copy of duly certified order of SECP shall be forwarded to the company and to registrar
within 7 days from the date of the order.
§ A certified copy of SECP’s order and a printed copy of altered MOA shall be filed with
registrar within 30 days of order
(May be extended by SECP)
§ Registrar shall register it and issue a certificate
Ch # 2. Memorandum and Articles Page 20

Alteration of Principal Line of Business clause

§ Company may by special resolution alter its MOA to Change its principle line of business
§ Such alteration shall not require confirmation by SECP
§ Company shall file amended MOA with registrar within 30 days on specified form
§ Registrar may give direction of change of name if name does not match with principal line
of business of the company.

Note: For adopting any business activity which is subject to licence, registration, permission or
approval under any law, company would follow the process of change in Registered office clause.
Ch # 2. Memorandum and Articles Page 21

ARTICLES OF ASSOCIATION (AOA)

Byelaws of company, subordinate to constitution (MOA) and further subordinate to the Act,
guiding day to day issues faced by a company.

§ It is option for company limited by shares to

- Get the articles registered; or
- Adopt Table A (first schedule of Companies Act 2017)
§ For other companies Registration of AOA is compulsory.
§ For Guarantee Ltd or Unlimited Co, AOA shall state:
- Amount of share capital at time of registration (If it have share capital)
- Number of members at time of registration (If it does not have share capital)
§ AOA shall list and specify the voting and other rights attached to different classes of shares
and securities.
§ If company contravenes its AOA, company and every officer shall be liable to a penalty

Contents of Table A
Details related to following areas are given in Table A so that companies may adopt it as it is:
§ Restriction related to commencement of business
§ Shares
§ Transfer and Transmission of Shares
§ Form for Transfer of Shares
§ Bank Account Details of Transferee for Payment of Cash Dividend
§ Transmission of Shares
§ Alteration of Capital
§ General Meetings
§ Notice and Proceedings of General Meetings
§ Votes of Members
§ Instrument of Proxy
§ Directors
§ Powers and Duties of Directors
§ Minute Books
§ The Common Seal of company
§ Disqualification of Directors
§ Proceedings of Directors
§ Filling of Vacancies
§ Dividends and Reserve
§ Accounts
§ Mode of giving notices to members
§ Winding Up
§ Indemnity for officers and agents of the company
Ch # 2. Memorandum and Articles Page 22

Applicability of Table A

§ Table A is applicable in full, if articles are not registered separately.

§ Table A is applicable to the extent not modified or excluded by articles filed by a company.
§ Table A is not applicable at all, if specifically excluded by articles filed by a company.

Alteration in the articles of association

§ Company may, by special resolution, alter its AOA

§ Any alteration shall be as valid as if originally contained in AOA
§ If alteration affects substantive rights or liabilities of members or class of members, it shall
be carried out only if majority of at least 3/4th of those affected vote for that (personally or
through proxy)
§ A copy of altered AOA shall be filed with registrar within 30 days
§ Registrar shall register the same.
Ch # 2. Memorandum and Articles Page 23

GENERAL PROVISIONS AS TO MEMORANDUM AND ARTICLES

Act to override memorandum, articles, etc.

§ The provisions of this Act shall have effect despite anything contained in any other law or
MOA or AOA or in any contract or agreement executed by it or in any resolution passed in
general meeting directors meetings.
§ Any conflicting (with Companies Act) provision contained in such documents shall be void.

Copies of memorandum and articles to be given to members

§ Each company shall send to every member, at his request and within 14 days on payment
of fee fixed by the company, a copy of the memorandum and the articles.
§ If an alteration is made in MOA/AOA, every copy of MOA/AOA issued after the date of
alteration shall contain that alteration
§ In case of contravention, company and every officer in default shall be liable to the penalty

Effect of memorandum and articles

§ Upon registration, MOA and AOA shall bind the company and the members
(just like that they all have signed it)
§ All moneys payable by a subscriber against the shares subscribed shall be a debt due from
him and be payable in such time, manner and conditions as may be specified by SECP
§ Any violation of directions given by Registrar shall be an offence liable to penalty of level 1

Form of MOA & AOA

Type of company Document Form

AOA Table A
Company limited by shares
MOA Table B
Company limited by guarantee and not having a share capital AOA & MOA Table C
Company limited by guarantee and having a share capital AOA & MOA Table D
Unlimited company having a share capital AOA & MOA Table E
Company licensed under section 42 (Association not for profit) AOA & MOA Table F