bus 360 company law

7/24/2019 BUS 360 Company Law

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Company Law



Point of Company Law

encourage investments

ensure due and proper administration of funds

and assets of investors

any wrong doings by directors and managers

provide audit and investigation into companies

aairs



What is company?

the term company is used to describe an

association of a number of persons, formed for

some common purpose and registered

according to the law relating to companies



Separate Legal Entity

a company registered under the companies act

is regarded by law as a single person having

specied rights and obligation

a company is dierent from its members and

the individuals composing it

a b c d e , !y corp



"ne man company or#amily comp$

could be

ma%ority share one person



Statutory company

formed by an act of legislature

&angladesh &an'



(egistered Company

) company registered by the companies act



*nregistered Company

an association or company not



Essential features of acompany

registration

voluntary association

legal personality

contractual capacity +a shareholder cannot bind the

company in any way

management +&oard of -irectors, etc

capital

permanent e!istence



registered o.ce

common seal

limited liability

transferability

statutory obligations +ling balance sheets,

registers, etc

not a citi/en



Company and partnership

(egistration

minimum number of members +pvt company

0, +pub company 1, +partnership 0



ma!imum number of members +pvt company 23,

partnership general 03

legal status

authority of members +partnership property4 %oint

property +property of company belongs to company

Contractual capacity4 shareholder can be employee

and enter into contracts with the company, partners

can contract with other partners but not the

company as a whole



management5 partner manager or other managers

4company4 manages by &oard of -irectors,

6anaging -irector etc

length of e!istence5 company4perpetual succession

+ended by li7uidation as per Company )ct,

Partnership5 in the absence of a contract to thecontrary, comes to a end when a partner dies or

becomes insolvent

liability of members5 partnership unlimited,

company liability is limited limited



liability of rm and company5 the creditors of

rm are creditors of individual partner,

4creditors of a company are not creditors of

individual shareholders



8ypes of Companies

Private company

Public company



Private Company

by its articles5 9$ restricts the rights of themembers to transfer shares

0$ limits the number of members

:$ prohibits any invitation to the public tosubscribe for any shares



Public Company

three types

9$ Companies limited by shares +share capital

and nominal value

0$ Companies limited by guarantee + each

member promises to pay a !ed sum of money

in the event of li7uidation

:$ unlimited companies +liabilities are

unlimited



-ierence between aPrivate Company and Public

CompanyPvt Company must have minimum paid up capital

of 933,333 lac t'

Public Company must have minimum paid upcapital 2 lac t'

Pvt company has restrictions on transfer of shares

(estrictions on invitation to public4 Pvt companycannot invite public to purchase shares

(estrictions on name5 Pvt limited



prospectus

commencement of business

number of directors5 Private 40, Public4:



6emorandum and )rticles

of )ssociation; its contains the basic rules regarding company

constitution and and activities of the company

; purpose is to let others 'now what its powers

are and the range of its activities

; it contains rules regarding the capital structure,

the liability of its members and all important

matters relating to the company

; it shows the range of the enterprise



)rticles

; contains the rules and regulations

; should be in line with the rules in the

memorandum



6emorandum contains thefollowing

; name clause

; situation clause +name of the place where the

company has registered o.ce

; ob%ects clause

; area of operation clause

; liability clause5 nature of liability of the members

; capital clause5 state the amount of share capital



)lteration of 6emorandum

; it can be altered by following the procedure

laid down in the companies act

; provisions of the memo can be divided into two

classes

; 9$ the inclusion which is made compulsory

; 0$ the provisions which the owners of the

company included by their desire



8he #ormation of aCompany



8he essential steps offorming a company

; the memo and the articles should be prepared

; should have a paid4up capital

; if the company formed intends to participate in an

industry which included in the schedule anne!ed to

the <ndustries +-evelopment and (egulation )ct,

9=2>, a license must be obtained under that act

; the company must be registered in accordance

with provisions of the Companies )ct, 9=2> and the

Certication of <ncorporation must be obtained



company, the followingfurther steps need to be

ta'en; the Prospectus or the Statement instead of

Prospectus must be issued and registered with

the (egistrar

; the allotment of shares must be made after the

minimum subscription is raised

; the Certicate of the Commencement of

&usiness must be obtained from the (egistrar



Procedure of (egistrationand <ncorporation

; the following documents with the necessary fees must be

submitted to the (egistrar of Companies of the State

;the 6emorandum of )ssociation, prepared in accordance

with the provisions of the Companies )ct, and signed by at

least 1 persons +public company and 0 persons +private

company

; a declaration by either one of the following persons statingthat all the re7uirements of the Companies )ct have been

complied with4 an attorney, a chartered )ccountant, or a

person name in the article as director, manager or the

secretary of the company



; a signed list of persons have consented to be

directors of the company, their consent in

writing and signed agreement with regard to

shares

; the registration fees based on amount of

nominal capital



8he Certicate of<ncorporation

; the Certicate issued by the (egistrar after the

company is registered is called the Certicate

of <ncorporation



C"CL*S<"

bus 360 company law

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