Memorandum of Incorporation

What the MOI does

The MOI establishes the company's governance arrangements within the Companies Act. It can address matters that the Act permits companies to vary, add relevant provisions and impose permitted higher standards or restrictions. It cannot simply displace mandatory law because the shareholders prefer a different arrangement.

A standard MOI provides a prescribed starting point. A customised document can reflect more particular arrangements where legally permitted, such as different share rights or decision requirements. Customisation is useful only when the wording fits the company's needs and works consistently with the statutory framework.

The operative document is the current MOI together with valid amendments. A registration pack from the company's first year may be incomplete if later amendments changed its governance. Establish which version is in force before relying on a clause to approve a transaction.

Why it belongs in the decision process

The MOI may affect who can make a decision, which votes are required and what rights attach to a class of shares. A proposed investor agreement, director appointment or transfer should therefore be checked against it early. Discovering a restriction after signing can create avoidable disputes or require a different approval process.

A shareholders' agreement is a separate agreement. Under the Companies Act it must be consistent with the Act and the MOI, and inconsistency can invalidate the relevant provision. Signing such an agreement does not by itself amend the MOI or complete any required filing.

Read how a shareholders' agreement relates to the MOI when the documents appear to conflict. The MOI decision checklist helps identify which proposed decisions need a closer look before a vote.

Illustrative example: an incoming investor

A company has operated with a standard MOI since registration. An investor now proposes a different class of shares and a right to nominate a director. The founders cannot establish those arrangements merely by adding them to an email confirming the investment.

They compare the proposal with the company's authorised share structure and current governance rules. They then identify which approvals, documents and amendments are required, if the arrangement is legally possible and commercially acceptable. The transaction documents and eventual company records must describe the same rights.

This example does not suggest every new investor requires a customised MOI. It shows why the proposed rights, rather than the label investor, determine the review. The guide to reviewing a standard MOI for several investors considers the practical triggers in more detail.

What the MOI does not replace

The MOI is not a business plan, a list of current shareholders or a record of every board decision. The securities register records holdings, resolutions record particular decisions and contracts record relevant commercial arrangements. Those records must operate consistently with the governance framework without being treated as substitutes for it.

An internal policy or informal unanimous understanding also does not automatically change the MOI. Amendments follow the applicable legal process, and some provisions may have additional restrictions. MOI amendment and customisation assistance should start with the current document, previous amendments and the precise rights or decisions the company wants to change.