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COMPANY'S CONSTITUTION, Is a legal document which sets out the objects…
COMPANY'S CONSTITUTION
EFFECT OF CONSTITUTION
Under CA 2016, the constitution of a company has a legal impact
besides being a contract between the company and each member and each member with each other
when adopted, bind the company and the members to the same extent as if the constitution had been signed and sealed by each member and contained covenants on the part of each member to observe all the provisions of the constitution
ADOPTION
Section 32 states that a company may adopt a Constitution and it shall be by way of special resolution
The Constitution has no effect to the extent that it is inconsistent with the provision of CA 2016. The adoption shall binding on the company, its directors and members
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The company or every officer who contravene this commit an offence shall be liable to;
- fine not exceeding RM50,000
- if the case being continue, a further fine not exceeding RM500 each day.
Previously, it was under Companies Act 1965 any companies were statutorily required to have a memorandum (MOA) and an Article of Association (AOA)
Section 31 provides that a company (exclude limited by guarantee) may or may not have a Constitution
if a company has a Constitution, all the rights, powers and obligation permitted to be modified with the Act are so modified by the Constitution .
if the company has no Constitution, all the powers, rights and obligation are governed by the CA 2016
ALTERATION
by the company
Section 36, a company having a Constitution may by a special resolution which requires a majority vote of 75% by the shareholders who are entitled to vote
the company shall notify the Registrar of the alteration or amendment of its constitution and lodge a copy of the constitution as altered or amended within 30 days from the date the special resolution was passed.
by the court
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The company shall ensure that an office copy of the 'NOTIFICATION OF ALTERATION OR AMENDMENT TO CONSTITUTION BY COURT ORDER' together with a copy of the Constitution as altered/amended is lodged with the Registrar for registration within 30 days.
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OBJECTS AND POWERS
CA 1965 required the constitution to contain a statement of the objects, a list of the powers which can be exercised by the company in achieving those objects
However, CA 2016 provides full power and capacity of a company under s 21. A company shall be capable of exercising all the functions of a body corporate and have the full capacity to carry on any activities such as;
- to sue and be sued
- to acquire, own, hold, develop or dispose of any property
- to do any act which it may do or, to enter into transactions.
Is a legal document which sets out the objects and powers of a company and also governs the internal affairs and management of the company