About Change in Company object Clause

The object clause of a company’s memorandum of association (MoA) defines the scope of its business activities. It outlines the company’s primary objectives, the nature of its operations, and the types of businesses it is authorized to undertake. Changing the object clause involves altering the company’s fundamental purpose and requires adherence to specific legal procedures to ensure compliance with regulatory requirements.

Applications for Filing

Modifying a company’s object clause is a formal process that necessitates the submission of specific forms and documents to the relevant corporate registry or authority. The specific forms may vary depending on the jurisdiction, but generally involve:

1. Form MGT-14: This form serves as the primary application for altering the object clause and must be signed by authorized company directors.
2. Explanatory Statement: An explanatory statement explaining the rationale behind the proposed change in the object clause and its implications for the company’s business activities.
3. Special Resolution: A copy of the special resolution passed at the company’s extraordinary general meeting (EGM) approving the proposed change.
4. Certificate of Incorporation: A copy of the company’s existing certificate of incorporation, which will be amended to reflect the revised object clause.
5. Additional Documentation: Depending on the specific circumstances, additional documentation, such as board resolutions, statutory forms, or supporting documents, may be required.

Eligibility

The eligibility for changing a company’s object clause is generally based on the following criteria:

1. Business Expansion or Diversification: Companies may need to modify their object clause to accommodate new business ventures, expand into new markets, or diversify their product offerings.
2. Changes in Legal or Regulatory Environment: Adaptations to the object clause may be required to comply with evolving legal or regulatory requirements, such as industry-specific regulations or changes in corporate governance norms.
3. Correction of Errors or Omissions: If the existing object clause contains inaccuracies, ambiguities, or outdated provisions, a change may be necessary to rectify these shortcomings and ensure clarity of purpose.
4. Mergers or Acquisitions: In the case of mergers or acquisitions, the object clause may need to be amended to reflect the combined business activities and objectives of the merged entities.

Documents Needed

The specific documents required for changing a company’s object clause typically include:

1. Board resolution approving the proposed change
2. Special resolution passed at the EGM
3. Draft of the proposed revised object clause
4. Explanatory statement justifying the proposed change
5. Company’s registration documents (certificate of incorporation, PAN, etc.)
6. Relevant fees and application charges