If you are new to the world of business, you might have felt confused between the Memorandum & Articles of Association (M&A) and Constitution. In fact, having the M&A is mandatory for all the companies under Companies Act 1965. Now, according to Companies Act 2016, the M&A is known as the constitution as a group. If you need help in creating the constitution (Also see Alterations and Amendments on the Constitution), or you need advice and suggestions on this matter, feel free to contact a corporate secretarial firm Johor Bahru.
According to Companies Act 2016, if your company is one of those which its incorporation is done under Companies Act 1965, the existing M&A for your company is still valid and enforceable, unless your company has resolved it. Your company can decide whether it prefers revoking the company constitution completely or amending specific clauses.
If your company chooses to revoke the M&A it already has and does not want to have a constitution, it needs to pass a resolution for this purpose. In this case, your company, as well as all its directors and members (Also see The Register of Members), should have the powers, rights, obligations and duties that are stated in Companies Act 2016. Likewise, if your company wants to coordinate its constitution according to the stipulations of Companies Act 2016, it needs to pass a resolution before making any amendments to any part of its constitution.
Your company can also choose to revoke M&A, as all the public companies can choose whether they want to have a constitution, except the company limited by guarantee. Thus, if your company wants to abolish the constitution, it should get the shareholder’s (Also see Balance Sheet – Liability and Shareholders’ Equity Accounts) approval. Note that you need to inform SSM about the decision. For limited companies that are subjected to the requirements of other laws, they should follow such requirements. This includes the resolution for revoking the company constitution or notifying the relevant authorities according to different situations.
Besides, companies may adopt part of the Memorandum of Association or Articles of Association that it has in place as its constitution. Before doing so, the company should get approval from its members (Also see Register of Members for Companies in Malaysia: Requirements and Importance) on this matter.
Even though it is not a must for companies to have a constitution, the companies should inform the Registrar about their nature of business. They should also notify the Registrar if there is a change in their nature of business.