What is Articles of Association (AoA)?
The Articles of Association is a legal document that contains the rules and regulations for the internal management of a company. It defines how the company will be run on a day-to-day basis.
Why is AoA important for a company?
AoA helps ensure smooth functioning of the company. It contains rules for appointing directors, conducting meetings, issuing shares, and more.
Is AoA required for all companies?
Yes. All companies registered under the Companies Act, 2013 must have an AoA. It is one of the essential documents submitted to the Registrar of Companies (ROC).
What is the difference between MoA and AoA?
MoA defines what the company can do (its objectives), while AoA explains how the company will do it (its internal rules).
What is included in AoA?
AoA includes rules regarding: Share capital, Rights of shareholders, Appointment and removal of directors, Conduct of board meetings and general meetings, Dividend distribution, Borrowing powers, Audit and accounts.
Who prepares the AoA?
The company's founders or promoters usually draft the AoA at the time of incorporation.
Who signs the AoA?
The subscribers to the company (founding members) must sign the AoA. Their signatures must be witnessed.
Can AoA be changed later?
Yes. AoA can be altered, but only through a special resolution passed by shareholders and filing with the ROC.
What is a special resolution?
A special resolution means at least 75% of the shareholders (present and voting) agree to a proposed change in the AoA.
Is AoA a public document?
Yes. Anyone can obtain a certified copy of the AoA by paying a fee to the Ministry of Corporate Affairs (MCA).
What if a company doesn’t follow its AoA?
If a company violates its AoA, any action taken may be declared invalid. Stakeholders can take legal action against the company.
Can AoA override the Companies Act?
No. AoA cannot go against the Companies Act or other laws. If any clause contradicts the Act, it will be considered void.
What if AoA is silent on a matter?
If AoA doesn’t mention a specific issue, the company must follow the Companies Act and model articles provided under law.
What is meant by Table F?
Table F contains a standard format for Articles of Association for companies limited by shares.
Can I adopt Table F as it is?
Yes. A company can adopt Table F entirely or modify it as per its requirements.
What is meant by Table G?
Table F contains a standard format for Articles of Association for companies limited by guarantee and having share capital.
What is meant by Table H?
Table F contains a standard format for Articles of Association for companies limited by guarantee and not having share capital.
What is meant by Table I?
Table F contains a standard format for Articles of Association for unlimited company and having share capital.
What is meant by Table J?
Table F contains a standard format for Articles of Association for unlimited company and not having share capital.
Can AoA be customized?
Yes. Companies often draft customized AoAs to suit their specific business needs while complying with the law.
Does AoA mention director duties?
Yes. AoA specifies how directors are appointed, their powers, duties, and conditions for removal.
Is AoA needed for a private limited company?
Yes. AoA is mandatory for all private companies and is submitted along with the MoA at the time of registration.
What if my startup wants different shareholding rules?
You can include special rights, restrictions, or conditions in the AoA regarding share transfers, voting rights, or dividend rights.
Can a shareholder sue if AoA is violated?
Yes. If the company’s internal rules are violated, shareholders can approach the tribunal or appropriate court.
What are typical contents of an AoA?
Share capital and rights, Call on shares, Transfer of shares, General meetings, Board meetings, Appointment of auditors, Dividend declaration, Winding up process.
Can foreign investors rely on AoA?
Yes. Foreign investors often review the AoA to understand the internal rules, rights, and duties before investing.
Who can view a company’s AoA?
Anyone — including shareholders, investors, creditors, and the general public — can view AoA by paying the required fee to the MCA.
Can AoA be different for each company?
Yes. Each company can have a unique AoA based on its internal policies and type of business.
Can AoA restrict transfer of shares?
Yes. Especially in private companies, AoA can include conditions or restrictions on how and to whom shares can be transferred.
Does AoA apply to directors?
Absolutely. AoA includes provisions on the role, powers, and limitations of directors.
What happens if there is a conflict between MoA and AoA?
MoA prevails over AoA. AoA is subordinate to the MoA.
Can AoA be enforced in court?
Yes. Since AoA is a legal document, it can be enforced in a court of law if violated.
What is the role of ROC in AoA?
The ROC verifies the AoA during registration and also approves any changes to AoA filed by the company.
Can a new director refer to AoA for rights?
Yes. Directors often refer to the AoA to understand their responsibilities, limits, and rights.
What if shareholders want to increase dividend rates?
If dividend distribution is governed by specific clauses in the AoA, changes must be made to those clauses with proper procedure.
How does AoA help startups?
AoA gives clarity on internal control, founder roles, investor rights, and dispute resolution mechanisms, which are vital for startups.
Can AoA include arbitration clauses?
Yes. Many companies include clauses in AoA for dispute resolution through arbitration instead of court.
What is a model AoA?
Model AoA is a standard format provided under Companies Act. It can be adopted fully or partially by companies.
Does AoA mention borrowing powers?
Yes. It includes conditions under which directors or the company can borrow money.
Can AoA be in regional language?
No. AoA must be submitted in English or Hindi as per official requirements.
Is digital signing of AoA allowed?
Yes. During online registration, digital signatures of subscribers are accepted.
What is the filing process to change AoA?
Hold board meeting, Pass special resolution in general meeting, File form MGT-14 with ROC, Wait for approval.
Can startup investors negotiate changes in AoA?
Yes. During funding, investors often demand changes in AoA to protect their interests.
How many times can AoA be changed?
There is no limit. AoA can be amended as often as needed, provided legal procedures are followed.
Is AoA valid after company closure?
No. Once the company is wound up or closed, the AoA no longer remains in force.