- The memorandum of association is the only part of a company’s constitution that is permanently locked after incorporation. Set out all operational rules you want to control in the articles of association.
- Forming a UK company and being named as a subscriber on the memorandum confers the right to form a company. It does not confer the right to work or live in the UK. Immigration status is governed by an entirely separate legal framework.
- A subscriber who dies between signing the memorandum and the company’s registration creates a gap in the founding record that requires legal advice to resolve. The memorandum cannot be amended to remove or replace them after the fact.
Memorandum of Association Is A Foundational Document for UK Limited Companies
To register a company under the Companies Act, you must provide a legal statement called the memorandum of association. This document forms part of the company’s constitution alongside the company’s articles of association.
The initial members, known as subscribers, sign the memorandum of association. Each subscriber must authenticate the company’s memorandum with a witnessed signature. For a private company limited by shares, each subscriber must also undertake to take at least one share.
Submit the signed document to Companies House as part of the company formation application. The registrar of companies then files it as part of the company’s permanent public record.
The memorandum’s sole function is to record the founding act of the UK limited company. It identifies who agreed to form the company and their initial commitments. The document does not govern ongoing operations or define director powers, voting rights, or processes for shares and shareholders. Rules for company management, shareholder rights, and decision-making belong in the articles of association.
Memorandum and Articles of Association: Your Company’s Unchangeable Record vs. Its Living Rulebook
| Feature | Memorandum of Association | Articles of Association |
|---|---|---|
| Purpose | Records the founding subscribers’ agreement to form the company | Governs how the company operates on an ongoing basis |
| Legal basis | Section 8 of the Companies Act 2006 | Section 18 of the Companies Act 2006 |
| Legal effect | Confirms the company’s existence and the identity of its founders | Forms a legally enforceable contract under Section 33 of the Companies Act 2006 between the company and its members |
| Content | Subscriber names, authentication, and commitment to take at least one share | Director powers, shareholder rights, share transfers, decision-making, voting rights, and dividend distribution |
| When created | At incorporation only | At incorporation, shareholders can amend it at any time after |
| Can it be amended? | No. The company may not alter it once Companies House registers the company | Yes. Shareholders amend it by passing a special resolution and filing the changes with Companies House within 15 days |
| Public record | Yes. The registrar of companies holds it permanently | Yes. Companies House holds the updated version, which companies must submit after each amendment |
| Governance role | None. The memorandum does not govern any post-incorporation activity | Primary governance document for the company’s internal affairs |
| Conflict resolution | Plays no role in resolving disputes between shareholders or documents | Takes precedence over a private shareholder agreement in the event of a conflict |
| Pre-2009 companies | For companies incorporated before , it contained an objects clause and an authorised share capital statement | The Companies Act 2006 treats the old objects clause as part of the articles; shareholders can amend it by special resolution |
| ECCTA 2023 impact | Subscribers named on the memorandum must complete mandatory identity verification | No direct ECCTA obligation, but all directors and persons with significant control must separately comply with identity verification requirements enforced by Companies House |
Understand the Two Core Clauses in a Memorandum of Association
Section 8 of the Companies Act prescribes the information that a memorandum of association for a private company limited by shares must contain.
Subscriber Names and Authentication
Each subscriber who wishes to form a company must record their full name and sign the document in the presence of a witness. For corporate subscribers, an authorised signatory signs on behalf of the entity.
Share Commitment Clause
The subscriber confirms their agreement to become a member and to take at least one share. The memorandum records this commitment but does not specify the price, class, or full details of the share structure. Those details are governed by the articles of association and the statement of capital filed on incorporation.
Verify Subscriber Identity via GOV.UK Before You Register Your Company
All subscribers named on the memorandum of association must complete mandatory identity verification under the Economic Crime and Corporate Transparency Act 2023. Subscribers must verify their identity directly with Companies House through its GOV.UK One Login portal before you submit the incorporation application to Companies House. Being named a subscriber alone triggers the verification obligation, regardless of whether the individual later becomes a director.
How International Subscribers Can Form UK Limited Companies
UK law permits non-residents to form a limited company and to be named as subscribers on the memorandum. There is no residency requirement for subscribers or directors of a private limited company. However, international founders face specific practical obligations that arise directly from the memorandum and company formation process.
Right to form vs. right to work
Being named as a subscriber on the memorandum and forming a UK company confers the right to form. The right to form a company does not confer the right to work or live in the UK. UK immigration law governs immigration status entirely separately. Avoid active day-to-day management of UK operations, as this is typically classified as ‘work’ under UK immigration rules and requires a specific visa, such as a Skilled Worker or Innovator Founder visa.
Defining a non-resident director’s duties as explicitly supervisory in the articles of association supports the distinction between the right to form and the right to work
Registered office requirement
Every UK limited company must have a registered office address in the UK. For international founders, this typically means using a registered office service. The address cannot be a PO Box. The registered office address appears on the public record and is the address to which Companies House and HMRC will send official correspondence.
Subscriber Commitments in the Memorandum Vary by Company Type
The requirement to have a memorandum of association applies to all UK limited companies, but the subscriber commitment recorded in the memorandum varies by company type.
Private company limited by shares
Each subscriber confirms their agreement to become a member and shareholder by taking at least one share. The memorandum does not set out the price or class of shares; the company’s articles of association and the statement of capital filed on incorporation govern those details.
Private company limited by guarantee
Non-profit organisations, charities, and membership associations use this structure. Subscribers do not take shares. Instead, each subscriber agrees to contribute a guaranteed amount, typically £1, to the company’s assets if it is wound up. The memorandum records this guarantee commitment rather than a share commitment, and there is no share capital.
Public limited company (PLC)
The memorandum for a public company (PLC) follows the same prescribed form as a private company, but the incorporation requirements are more demanding. A PLC must have a minimum share capital of £50,000. Shareholders must pay up at least 25% of that capital before the company can trade. The memorandum records the subscribers’ agreement to take shares, but the PLC cannot start operations until Companies House issues a trading certificate confirming the company has met the minimum capital requirement.
Frequently Asked Questions
Can the memorandum be used as evidence of company ownership?
Official proof of company ownership rests with two documents: the company’s register of members and issued share certificates. The memorandum of association is a founding document that does not reflect current shareholdings and is therefore unsuitable as evidence of ownership.
Does the memorandum need to be updated when directors change?
Director changes have no effect on the memorandum because the document is locked at incorporation and only concerns the original subscribers. To update director information, you must file form AP01 with Companies House and amend the company’s register of directors.
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