When starting a private company in Bangladesh, one of the most critical legal requirements is drafting and submitting a Memorandum of Association (MOA) to the Registrar of Joint Stock Companies and Firms (RJSC). In this blog post, we’ll cover everything you need to know about MOA, including its purpose, significance, and how to draft one.
MOA is a legal document that outlines a company’s objectives, scope of business, and relationship with its shareholders. It is essentially the company’s charter and provides a framework for its operations. The MOA defines the company’s authorized share capital, the number of shares, their nominal value, and the rights and privileges attached to each class of shares. 💼📜
Is MOA compulsory for a private company? 🤔
MOA is compulsory for all types of companies in Bangladesh, including private companies. Under the Companies Act, 1994, companies must submit their MOA to the RJSC for approval and registration. The RJSC requires a company to submit its MOA along with other relevant documents, such as the Articles of Association (AOA), to register the company. 💼📜📝
Legal Problem without MOA ⚠️
If you start a private company in Bangladesh without an MOA, you risk facing various legal problems. Firstly, you will not have a clear framework for your business operations, which can lead to confusion and disputes among shareholders. Additionally, you will not be able to open a bank account, obtain necessary licenses and permits, or apply for loans and grants without an MOA. 💸💼👨💼👩💼🤝❌
Here are the essential components of a company’s MOA: 🔍
- Name clause: This specifies the name of the company and its registered office. 🏢
- Object clause: This outlines the company’s objectives and the scope of its business. 📈📊
- Liability clause: This states the extent of liability of the company’s shareholders. 💰👥
- Capital clause: This specifies the authorized share capital of the company and the number of shares. 💰📈
- Subscription clause: This outlines the number of shares subscribed by each shareholder. 👥💰
- Association clause: This specifies the agreement between the shareholders and their intention to form a company. 👥🤝💼
To avoid these legal problems, it is crucial to draft and submit an MOA to the RJSC. An MOA outlines a company’s objectives, scope of business, and relationship with its shareholders. It provides a framework for its operations and defines the company’s authorized share capital, the number of shares, their nominal value, and the rights and privileges attached to each class of shares.
When drafting your company’s MOA, it’s essential to ensure that it complies with the Companies Act and other relevant regulations. You can seek legal advice or use online services such as Shapla Start to prepare and submit your MOA to the RJSC. 💻📜👨💼👩💼