Charter documents like the Memorandum, the Articles of Association etc., are important for the regulation of the company and operational works. It is the track route for efficient management, company profitability, and a guideline to direct towards the company's objective.
While drafting an AOA (Article of Association) or an MOA (Memorandum of Articles), it must follow the Acts directed by the Company of Registrar directives. The sections and sub-sections listed below are regarding the formulation of AOA and MOA.
19. Articles of Memorandum and Association Must be Signed
(1) All the founders shall sign every page of the memorandum of articles and articles of association. In addition to the signature of the authorised person of an organisation, the seal of such an organised organisation should also be affixed.
(2) When signing as per subsection (1), it shall be signed at the end of each page. If the company has more than eleven founders, it would be sufficient for the first managers to sign at the end of each page. But on the last page, each founder must sign and put a lapel pin.
(3) If the English translation of Articles of Association and Memorandum of any company is required, it should be translated from Notary Public and submitted as per subsections (1) and (2). Even if the English language copy of the Articles of Memorandum of the company is recorded by the office, it will be considered official.
20. Registration May be Denied on the Basis of Name
(1) In any of the following cases, registration of an office company may be denied:
a. If the name of the proposed company indicates that the company has any relationship or affiliation with the Government of Nepal, any public institution or body or local body but no document of involvement or consent of the Government of Nepal or the concerned body is submitted.
b. If the name of the proposed company contains false or misleading information about the purpose or the work to be done by such company.
(2) No company shall be allowed to change its name in any circumstances mentioned in subsection (1).
(3) As mentioned in Article 6(c) of the Act, if the name of a previously registered company matches the name of the company which has not been in existence for 5 years for any reason or if the name of the company is proposed to match the name of such company in that way may create confusion. However, according to the law, if the merging company requests to accept the name of the former company (merged company) for one year after the merger, there will be no impediment for the office to record the amendment.
21. Additional Provisions Regarding the Name of the Company:
(1) The company shall use the word "Limited" only after its name.
(2) No such company shall be registered if the word "Limited" or " Private Limited" is used elsewhere except after the name of the proposed company.
(3) The name of the company shall be in both Nepali and English.
(4) If the name of the proposed company is similar and creates confusion with the names of the company registered in the office, such a company will not be registered.
(5) Pursuant to subsection (4), whether the name of the proposed company is similar to another company or not or the proposed company name creates confusion may be decided by the following points:
a. The proposed name of the company differs from the nature of the company (e.g. a private company or a public company, or a non-profit company).
b. The words like 'The', 'New', and 'Shree' used before the proposed company's name differs from the proposed name from other registered names.
c. The use of punctuation marks such as commas and semicolons to indicate that the company's proposed name differs.
d. If there is a general difference in spelling (e.g. if the company's proposed name sounds or sounds similar to the name of another company registered), the company's proposed name looks different.
22. Name Should be Changed If Required
(1) The office may order to change the name of any company registered in the following cases:
a. In case of registration of a company with a name contrary to the Act or this directive due to general error of writing or any other reason.
b. If any concerned person complains in writing stating that the name of any registered company is contrary to the Act or this directive, the office will conduct the necessary investigation and find that such a situation exists.
c. Whether the name of the company creates confusion even if a complaint is lodged or not, the office conducts the necessary investigation, and such a situation exists.
d. In case of misinterpretation of the name of the company or disclosure of misleading information or intent on the name of the company.
(2) The company concerned shall change its name within 35 days as ordered issued by the office pursuant to subsection (1).
(3) Generally, matters to be considered while registering the name of the company are given in Schedule 3.
23. Application for Approval of Name Amendment Shall be Submitted
(1) If the company wishes to amend the name, it shall apply for prior approval in the office by passing a special resolution in the general meeting or in the case of a private company not holding a general meeting as decided in the agreement.
(2) Pursuant to subsection (1), the reason for amending the name in the application submitted to the office shall also be disclosed.
(3) If the proposed name is not contrary to the Act and the directives, the office shall give the approval to amend the name.
(4) The office shall issue a new registration certificate to the company stating that the name amendment has been approved in accordance with subsection (3). Thus, when issuing a new certificate, the name of the former should be mentioned at the end of the certificate.
(5) The name shall be deemed to have been amended only after the office has given written information after recording the transaction that the name has been amended or corrected.
(6) The change of name alone will not affect the rights, duties and obligations of the company.
24. Documents to be Submitted for Name Amendment Approval
The following documents should be attached with the application submitted to the office for name amendment as per Article 23.
a. A copy of the special resolution passed by the general meeting or the decision made in accordance with the provisions of the consensus agreement in the case of a private company not holding a general meeting.
b. Two copies of Articles of Association and Memorandum of Articles proposed for amendment.
c. Certificate of Company Registration
25. Documents to be Submitted in Case of Amendment of Articles of Association and Memorandum of Article
The following documents should be submitted to the office to give information about the amendment of the Articles of Association and Memorandum of Articles besides the name of the company.
a. A special copy of the amendment passed by the general meeting or a copy of the decision made in accordance with the provisions of the rules of the company or the consensus agreement in case the company does not hold a general meeting.
b. Two copies of amended Articles of Association and Memorandum of Articles.
c. If any provision of the Articles of Association and Memorandum of Articles of a company has been amended, the previous arrangement, the amended arrangement and the three-story paper (Tin Mahale Kagaj) need to be prepared openly.
However, if the general meeting of a company decides to repeal the existing Articles of Association and Memorandum of Articles and implement new Articles of Association and Memorandum of Articles, such a three-story paper will not be submitted.
26. To Declare Compliance With the Act
Before the public company publishes the statement, the operator of the company shall have to declare in writing that he has complied with the provisions of the Act and this directive, along with the application for registration of the statement in this office.
For the purpose of Section 25 of the Act, "Stakeholders" means any of the following:
a. Owner of such company, or
b. Heir of the shareholder of such company, or
c. The auditor of such company, or
d. Any other person establishing the fact that he is concerned.
28. Copy Fee
(1) Copies of Articles of Association, Memorandum of Articles and other instruments of the company are available to shareholders or other stakeholders. The fee incurred by the company should be based on the actual cost incurred while providing the copy.
(2) Rs. 10 is prescribed when the office provides copies of the writing as per subsection (1)
While making changes and amendments to these charter documents, the Company Registrar must be notified. All the shareholders/stakeholders have to know the amendments, and copies after amendments have to be made available to all the stakeholders/shareholders.