AOA Overview and Format

What is AOA?

AOA full form is Articles of Association. Articles of Association of the company contain rules, regulation and bye-laws for the general management of the company. It is compulsory to register the articles of associations along with the memorandum of association in case of a private company.

The articles of association constitute a contract between the company and its members and the members inter se. The Articles are subordinate to the Memorandum of Association. Therefore, the Articles should not contain any regulation, which is contrary to provisions of the Memorandum or the Companies Act. The Articles are binding on the members in relation to the company as well as on the company in its relation to members. However, this does not constitute a contract between the company and a third person. Every company formed in India under Companies Act must have articles, without which a company cannot legally be formed. As a result, this requirement applies to all types of Companies.

Features of Articles of Association

The following are some of the features of AOA:

  • It is a part of the constitution of an organization.
  • A contract between the members and among the members themselves.
  • Furthermore, It lays down the duties of shareholders.
  • Few statutory clauses are mandatory in the article of associations. Whereas, other clauses are opted by choice to make the bye-laws of the organization.
  • Article of Association can also be inspected by anyone as they are a public document.

Primary Contents Of An AOA

The Articles of Association document further includes the following details:

  • Definitions
    • Firstly, mention the definition of all important words in the Articles in order to avoid any ambiguity in interpretation.
  • Share Capital
    • Furthermore, show the total capital of the company in the Share Capital clause.
  • Type Of Company
    • Mention whether the company is either a private of a public limited company along with appropriate details.
  • Shares
    • All the details as to the control of the shares and the power to allocate shall also be described. In a private limited company, the shares shall be under the control of the directors who shall allocate the same to the members according to prior decided times and manner.
  • Agreement
    • If the Memorandum of Association of the company mentions any agreement of any nature that needs to be completed, it needs to be mentioned that the Directors shall give effect to such agreements as soon as possible after the registration of the company.
  • Transfer and Transmission of Shares
    • Additionally, describe all details as to the transferability of shares in the Articles of Association. The directors of a private limited company shall be allowed to transfer their shares to their legal heirs.
  • Sale Notice
    • Additionally, you need to mention if members wish to sell their shares, they need to give a notice in writing to the directors. This shall also be applicable on sale to members or to any outsider nominated by the directors.

Other Clauses for PLCs

Other prominent clauses for private limited companies are as following:

  • The number of Directors of the company
  • Qualifications to be a Director
  • Names of the first directors
  • Appointment of additional Directors
  • Details as to who shall be responsible for the management of the business
  • Appointment of the Managing Director
  • Rotation of Directors
  • Reasons for disqualification of Directors
  • Intervals and particulars of meeting of the Board of Directors
  • Methods of serving notice
  • Details about Annual General Meeting of the Company
  • Notice method for Annual General Meeting
  • Quorum required for Annual General Meeting
  • Voting method at such meeting
  • Accounting practices to be followed in the company
  • Details as to where shall the books of accounts be maintained.
  • Preparation of the Profit and loss accounts and balance sheet before general meetings
  • Auditing  methods and intervals
Articles of Association
Download the format of Articles of Association as per Companies Act, 2013 for a Company Limited by shares
Download
Articles of Association
Download the format of Articles of Association as per Companies Act, 2013 for a Company Limited by shares
Download

FAQs

Are articles of association the same as the constitution?

No, the Memorandum of association is the constitution of the company. The articles of association, are subordinate to the memorandum of association of a company, which is the dominant, fundamental constitutional document of the company.

Who can enforce articles of association?

Since the Articles of a company bind the company to its members, and bind the members to the company and further also bind the members to each other, they constitute a contract amongst themselves and therefore, its members with respect to their rights and liabilities as members of the company.

How does one obtain a company’s articles?

One can get access to any company’s memorandum and articles from any of the following:
1. Ministry of Corporate Affairs website (Company public documents section)
2. Company public documents may also be obtained from several from private players

Got Questions? Ask Away!

  1. Hi @Aditya_s,

    Company formation documents are the key pieces of documentation issued after the successful registration of a new limited company. You must retain these important documents, ideally at your registered office address, because you will need to refer to them throughout the lifetime of your company.