How to Review a Memorandum of Association: A Clause-by-Clause Checklist

How to review a memorandum of association Reviewing a memorandum of association (MoA) means checking that the company's charter actually fits what the company is and intends to do, and that it complies with the Companies Act, 2013. People review an MoA in a few situations: at incorporation, during due diligence before investing in or acquiring a company, when onboarding a vendor or borrower, or before an activity that might be outside the objects. In each case the questions are the same: is each clause correct, complete and consistent with the real business? Work through the six clauses in order, with the red flags to watch for. ## Clause-by-clause checklist 1. Name clause. Confirm the name exactly matches the certificate of incorporation and ends with "Private Limited" or "Limited" as appropriate. Red flag: the MoA name differs from the name on other records, or uses restricted words without approval. 2. Registered office clause. It should name the State. Check that the State matches where the company is actually registered, since it fixes the Registrar's jurisdiction. Red flag: a State that does not match the company's filings. 3. Object clause (the one that matters most). Read the objects against what the company actually does and plans to do. The clause should clearly state the main objects and the matters necessary to further them. Red flag: the real business is not covered by the objects (an activity outside the objects is problematic and may need an MoA amendment), or the objects are so vague they describe nothing. In due diligence, a mismatch here is a finding, not a formality. 4. Liability clause. Confirm it matches the company type: limited by shares, limited by guarantee, or unlimited. Red flag: the liability clause does not match the Table used or the company's actual structure. 5. Capital clause. Check the authorised share capital, number of shares and face value, and compare it to the issued and paid-up capital in the company's filings. Red flag: issued capital exceeds authorised capital, or the capital clause is inconsistent with the latest shareholding records, which signals a missed filing. 6. Subscription clause. Verify the original subscribers, their shareholdings and that minimums are met (two for a private company, seven for a public company, one for an OPC). Red flag: fewer subscribers than required, missing witness, or details that do not reconcile with the register of members. ## Cross-checks beyond the clauses - Consistency with the AoA. The MoA and articles must not contradict each other. Red flag: the AoA purports to allow something the objects do not support.

• Amendments. Changes to the MoA (name, registered office shift between states, objects, capital) require the right special resolution and filings under the Act (for example Section 13 for alteration). Red flag: the company acts on a change that was never formally passed and filed.
• Up-to-date version. Make sure you are reading the current, amended MoA, not a superseded one. Red flag: the only copy available is the original from incorporation despite later changes. ## Red flags at a glance | Red flag | Why it matters | Fix | |---|---|---| | Objects do not cover the real business | Activity may be outside the charter | Amend objects under Section 13 before acting | | Issued capital exceeds authorised | Shares issued without headroom | Increase authorised capital and file | | Vague, copied objects list | Weak in due diligence, bank scrutiny | Redraft to match actual business | | MoA name differs from other records | Identity and KYC mismatch | Reconcile records, correct the error | | Reading a superseded version | Decisions based on stale charter | Obtain the current amended MoA | | Liability clause wrong for company type | Fundamental structural error | Use the correct Schedule I Table | ## Jurisdiction note This checklist is built on the Indian Companies Act, 2013. The charter document, its required clauses and the amendment process differ in other jurisdictions (the UK memorandum and articles, for example, work differently), so for a non-Indian company treat the structure as varying by jurisdiction and review against the local companies legislation. ## When an MoA review is triggered in practice Knowing why you are reviewing the MoA tells you where to push hardest. At incorporation, the focus is getting the objects and capital right for the business as planned. In investment or acquisition due diligence, the focus is reconciliation: do the objects, capital and subscribers match the share register, the filings and the business as actually run, and have all amendments been properly passed and filed? For a bank or vendor onboarding a counterparty, the object clause and the authorised-versus-issued capital are usually the two checks that matter most. And before a company starts a genuinely new line of activity, the single question is whether the existing objects already cover it or whether an amendment under Section 13 must come first. Match the depth of your review to which of these you are doing. ## Final pass The single most important question in an MoA review is whether the object clause covers what the company actually does. If it does, and the capital and subscription details reconcile with the company's filings, the MoA is in good shape. If the objects do not match the business, flag it: that is the finding that most often needs fixing before a deal, a loan or a new line of activity proceeds. This page is general information for India and other common-law jurisdictions, not legal advice. Contract law and stamp duty vary by jurisdiction, and a specific deal may need a qualified lawyer. ## Where a contract workspace helps Everything above is manual work: you started from a template, read every clause for the one that bites, tried to remember a renewal or a filing date, and kept track of who approved what. When you sign a few contracts a year, a careful person with a checklist can do this. When you sign hundreds, across teams, the gaps are where the risk hides. That same loop can live in one AI contract workspace tuned to how your company actually contracts. You draft from your own patterns, see each clause marked favourable, neutral or unfavourable to you, edit clauses in plain English, and keep a live timeline of versions, obligations and dates in one place rather than across inboxes and folders. Adira is built that way, India-first and global-capable. The point is not the tool; it is that the drafting, the review and the tracking you just did by hand do not have to stay scattered.