A firm’s memorandum of association is its constitution, which specifies the firm’s permissible commercial operations, place of formation, kind of organization, assets, and shareholders’ liabilities, among other things. When a corporation’s name is changed, the head office is moved from one region to another, the objectives section is changed, the funding section is changed, or the authorized share capital is increased, the firm’s memorandum must be changed. Changes to the memorandum of association can be made by approving a special proposal at a gathering of the company’s shareholders.
Alteration in Memorandum in Association
When companies need to modify the company clauses, they alter their MOA. There are the following clauses included in the MOA:
The quantity of share capital with which the business is established, as well as the split of that capital into fixed-value units, is shown in the MOA of a firm with shareholding. It can be raised by going through the proper legal procedures.
Amendment in Capital Clause
Changes can be made to raise the company’s share capital by issuing additional shares or merging current shares into bigger stakes. Converting completely funded shares to equity or vice versa necessitates a change in the MOA. Finally, changes in the clause are notified when unissued shares are canceled.
The MOA’s liability section specifies whether shares or guarantees regulate the firm’s liability. In addition, the Memorandum of Association states whether the shareholders’ responsibility is limited or not.
Amendment in liability clause
The change in liability sections causes the limitation in directors’ liability. By enacting a special resolution, which must be registered with the Competent Authority, the liability provision can be made unlimited.
The location in which the company’s legal address will be located must be specified in the MOA. The firm’s residence must be specified for the Judiciary, tax officials, and ROC to determine jurisdiction.
Amendment in state clause
Any change in the Memorandum relating to the firm’s objectives will be registered by the Secretary, who will verify the filing within 30 days. Any such modification in the Memorandum causes a firm’s main office to be transferred from one region to another.
It lists the Firm’s commercial operations, whether the corporation operates in all of them or not. The Company is not allowed to engage in any corporate action not specifically listed in the Object Clause. It would be judged beyond the company’s capabilities.
Amendment in object clause
If a firm wants to modify its corporate aim, it must first adopt a special resolution. The specifics of the goal must be posted in the daily paper where the firm’s legal headquarters is located, as well as on the firm’s site.
It includes the organization’s name. As per Latvian laws, the name of the LLC must contain the type of business at the end or start of the business name. The term cannot control the “Republic of Latvia” in it. The name must also be unique and should not have any uncensored words.
Amendments to the name clause
The corporation can file a name amendment request after checking the availability and authenticity of the newly chosen name.
Steps of Amendment in MOA
- A board meeting is conducted to decide whether or not to alter the charter and get votes from all shareholders. To do this, the corporation holds a shareholder’s meeting under the supervision of the meeting leader, who notes the meeting’s goal, discussion, and vote data and submits them to the officials.
- At the board meeting, a board decision is approved to change the MOA, which is dependent on shareholder authorization.
- After the votes have been cast and decisions have been made, the request application is filled and sent to the authorities along with all required papers.
- The state fee is paid via bank or in person.
- Required documents.
- Request application form KR18.
- A revised version of the funding agreement.
- Receipt of the state fee payment.