ARTICLE OF ASSOCIATION (AOA) || Business Partner Nepal.

Every company is required to frame Article of Association (AOA) while registration of the company in order to achieve the objectives set forth in its Memorandum of Association(MOA). The article of Association is binding on company, shareholders and its stakeholders after registration of the company.  It is also called ‘NIYAMAWALI-नियमावली ’ in Nepali.

The Article of Association shall include the following matters:-

  1. Procedures for convening the general meeting of the company and notice to be given for such meeting,
  2. Proceedings of the general meeting,
  3. Number of directors, provision of the alternate director, if any, and tenure of directors,
  4. Provisions relating to the minutes of decisions of the general meeting and the board of directors, and duplicate copies and inspection thereof,
  5. If a person has to subscribe shares to become a director of a company, minimum number of shares,
  6. In the case of a public company, qualifications, and number of independent directors,
  7. Where any professional persons, other than shareholders, are to be appointed as directors, provisions relating to the number, tenure, qualifications, and procedures of appointment of such persons,
  8. Powers and duties of the board of directors and the managing director,
  9. Authority of directors and delegation of authority,
  10. A quorum for a meeting of the board of directors, notice of meeting and proceedings of a meeting,
  11. Lien on shares,
  12. Different classes of shares and the rights, powers, and restrictions attached to such shares,
  13. Provisions relating to calls on shares and forfeiture of shares,
  14. Provisions relating to the transfer of shares,
  15. Matters on alteration in share capital,
  16. Matters on buying back of shares by the company, if the company is to buy back its shares,
  17. Appointment of a company secretary,
  18. Provisions relating to remuneration, allowances, and facilities of directors,
  19. Use of the company’s seal in its transactions, if it is to be so used,
  20. Accounts, books of accounts and audit of the company,
  21. Provisions on powers to raise loans or debentures,
  22. Amalgamation of the company,
  23. Such matters, if any, as required by the prevailing law to be mentioned in the articles of association of a company carrying on any specific business,
  24. Such other necessary matters as required to be mentioned in the articles of association.

Further Points to be noted

  1. if any provision contained in the Article of Association is inconsistent with the Companies Act, 2006 and Memorandum of Association, then such provision shall be void to the extent of such inconsistency.
  2. If the promoter agrees to accept the Article of Association in the format prescribed for the incorporation of a company with a single promoter of a single shareholder, it shall not be required to submit the article of association of the proposed company.
  3. A public company shall publish its Memorandum of Association(MOA) and Article of Association(AOA) within 3 months of obtaining a license to commence its business.

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