This article will explain what a Memorandum of Association (MoA) is and how to write MoA.
By following the step-by-step guide provided in this article, you can easily draft an MoA that complies with Nepali law.
What is the Memorandum of Association (MoA) (Nepali: प्रबन्धपत्र)?
The MoA is a legal document that a company needs to create when it registers in Nepal. In Nepali language, it's called "प्रबन्धपत्र".
The MoA explains what the company wants to achieve, like its goals and mission. It also tells the shareholders what their rights and responsibilities are.
This is really important because it sets out what the company can and can't do. Every shareholder must sign the MoA during the registration process.
So, in short, the MoA is a very important document that's required when registering a new company in Nepal.
Step-by-Step Guide to Writing an MoA
Here's a step-by-step guide to writing an MoA:
Step 1: Company Name and Registered Office
The MoA must start with the name of the company, followed by the registered office address. This section should also include the state and district where the company is located.
Step 2: Objectives of the Company
The next section of the MoA should explain what the company wants to achieve. This is called the objectives section.
It should include the main goals of the company, as well as any other smaller goals they may have. These goals need to be specific, easy to understand, and brief.
Step 3: Liability of Shareholders
The MoA should also explain what happens if something goes wrong with the company. This is called the liability section.
It should say how much each shareholder is responsible for, and if they have any limits on their responsibility.
Step 4: Share Capital
The next part of the MoA talks about the company's money. It's called the share capital section.
It should say how much money the company can raise by selling shares, how many shares have been sold, and how much money has been paid for them.
Step 5: Rights of Shareholders
The MoA should also explain what shareholders can do. This is called the shareholder rights section.
It should say how much power shareholders have to vote and make decisions, how much money they can get back as a dividend, and any other rights they may have.
Step 6: Board of Directors
The MoA should also talk about the people in charge of the company. This is called the board of directors section.
It should say how many directors there are, what they can do, and how they were chosen to be directors.
Step 7: Winding up of the Company
The last part of the MoA talks about what happens if the company has to close down. It's called the winding up section.
It should explain the steps that need to be taken if the company needs to be shut down.
Conclusion
Creating an MoA in the Nepali language is important when starting a new company in Nepal. This document sets out the goals, objectives, and mission of the company, as well as the rights and responsibilities of its shareholders.
FAQs
Is the MoA and Articles of Association (AoA) of a company the same?
No. The Memorandum of Association (MoA) and Articles of Association (AoA) are different from each other.
The MoA gives important information about the company, while the AoA contains the company's internal rules and regulations. The MoA is more important than the AoA.
Is it necessary to write the MoA in Nepali?
Yes, it is necessary to draft the MoA in the Nepali language to register a new company in Nepal.
Who needs to sign the MoA?
All shareholders of the company must sign the MoA during the company's incorporation process.
What happens if the MoA is not drafted correctly?
If the MoA is not written properly, it can cause legal problems and make it hard to register the company.
That's why it's crucial to follow the guidelines and rules set by Nepali law when writing the MoA.