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Memorandum and Articles of Association Explained

Memorandum and Articles of Association Explained

 

Starting a new company produces a plethora of paperwork. Staying on top of the pile will alleviate the inevitable stresses that come with company formation. Once you’re familiar with that proverbial pile, much of the unwelcome stress will begin to subside and you can focus on getting results!

As a business owner, two important terms/documents you’ll come across are the “memorandum and articles of association”. This guide will help you understand how to get a copy of the memorandum and articles of association and outline what both of these documents mean for your business.

 

A Brief Introduction to the Memorandum and Articles of Association

It is a legal requirement for UK companies to have both the memorandum and articles of association. Both of these governing documents are produced when a company completes its formations process, and subsequently both the memorandum and articles of association will be registered at Companies House.

Before we understand how to get a copy of the memorandum and articles of association, here’s a brief snapshot of the two:

The memorandum of association (in its entirety) is technically a legal statement outlining the names of a company’s founders. Produced in a standard format, the document lists each subscriber’s objective to become a member and incorporate the business.

The articles of association act as a guide to how a company should be run. Companies may wish to select “model articles” from Companies House or amend and personalise the standard document in order to devise their own rules and regulations.

 

The Memorandum of Association Defined

The memorandum is a single document containing the names of the founding members (shareholders/guarantors) of a company who have subscribed/added their name to the memorandum. The members’ signature to this document outlines the intention of these “subscribers” to form and join the company in question.

 

Can the Memorandum of Association Be Changed?

Since this is a legal document, the format cannot be changed before you form your company. The memorandum of association is a document with historical significance and is set to remain consistent for the lifetime of your company regardless of original or new company members leaving or joining, respectively.

To this end, the names of subscribers cannot be altered or removed after company set up.

 

The Articles of Association Defined

Before you learn how to get a copy of memorandum and articles of association, let’s define the latter now that you know what constitutes a memorandum.

The articles of association are technically the constitution of a limited company and contain a number of pages outlining this “company constitution”. This document is very much a company guide and rulebook that outlines the ways in which a company should be structured and managed in relation to the following:

  • Decision making
  • Members’ rights, duties, and liabilities
  • Directors’ duties, responsibilities and powers
  • Share capital (issuing and transferring shares)
  • Profit distribution
  • Director appointment and removal
  • Decisions regarding the appointment of company secretary
  • Administrative issues

Unless a company chooses to create their own articles of association, the model articles from Companies House under the Companies Act 2006 are considered the default articles. They are a simple document and easily adoptable by private limited companies that issue only ordinary shares, and for some companies limited by guarantee.

Generally, model articles are a sensible choice for small companies that are exempt from any specific provisions.

Self-created articles are a better option for companies that have multiple share classes and more than a single shareholder as the document may be tailored to meet a company’s individual goals, ensuring all company members are fairly treated in adherence to the shareholders’ agreement.

 

 

Can the Articles of Association Be Changed?

The articles of a company limited by shares or guarantee can be changed at any time. Any changes to the articles of association have to be agreed by a 75% majority of the company’s members at a voting process at the general meeting. Subsequently, it must pass a special resolution, unless entrenchment provisions are in place (which may result in more onerous approval requirements).

Once the changes have been confirmed, a copy of the resolution and updated articles must be submitted and filed with Companies House within a period of 15 days.

Model articles may be changed by adding, changing or removing any provisions, with a copy subsequently sent to Companies House during the incorporation stage.

It’s best advised to seek legal assistance if you choose to create your own articles of association to avoid any potential errors in the creation and submission process.

Where Should the Memorandum and Articles of Association Be Stored?

The memorandum is a public document that may be viewed by the public via Companies House. Every company has to keep a copy of the memorandum at their registered office or SAIL address. Likewise, companies have to keep a copy of the articles of association at their registered office or SAIL address.

Note: The public record will display a company’s articles.

 

 

How to Send the Memorandum and Articles of Association to Companies House

If you have registered your company online using Companies House Web Incorporation Service, you have to adopt the model articles by simply submitting the memorandum online. Companies House does not require a copy of the model articles.

However, if your company is registered via the Companies House paper application, you can choose either the model or bespoke articles. Both the memorandum and bespoke articles must be submitted by post (albeit the model articles needn’t be included).

 

 

How to Get a Copy of the Memorandum and Articles of Association

And this is how to get a copy of the memorandum and articles of association! Simply go to Companies House and download a copy of the articles online.

For already-registered companies, the process is as simple: head over to Companies House for the same, or use the assistance of a quick and efficient company formations service if you registered your company with a formations agency.

Remember…

It is a legal requirement for all UK companies to have both a memorandum and articles of association. At the time of company formation, the memorandum will be submitted to Companies House along with the articles of association and the application to register a company.

 

If you need help to retrieve your memorandum or articles of association, contact our professional and reputable company formations team who will help you every step of the way.

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