Change Objective/Activity

"Reinvent your purpose, redefine success: Expert guidance for smoothly changing the objective/activity of your company."

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    Overview

    A company’s objectives or activities may change over time due to various reasons such as changes in market conditions, mergers and acquisitions, diversification, and more. In such cases, the company may need to update its objectives or activities in its Memorandum of Association (MOA) to reflect the new changes.

    Why Change

    A company’s operations are confined to the objectives stated in its MoA. Objectives may need to be revised in scenarios such as Corporate Acquisition: When a company is acquired, operational and goal-oriented shifts may occur, even if the brand identity remains. New Business Endeavors: Introducing new products or services, or penetrating new markets, may necessitate a reevaluation of company objectives, including geographic or service expansion. Regulatory Compliance: Changes in government regulations may render certain activities illegal or restricted, prompting a company to revise its objectives to comply with new legislation. Outdated Practices: Discarding ineffective methods and adopting new strategies may lead to a change in objectives to align with more current practices.

    Updating the objectives or activities of a company may be necessary for various reasons, such as:

    1. Diversification: If a company wants to enter a new market or introduce a new product, it may need to change its objectives or activities to reflect the new business.
    2. Merger or Acquisition: In case of a merger or acquisition, the company may need to change its objectives or activities to align with the new business strategy.
    3. Regulatory Compliance: If the company’s existing objectives or activities are not compliant with the relevant regulations, it may need to change them to avoid legal issues.

    Procedure

    The procedure for changing the objectives or activities of a company involves the following steps:

    1. Hold a Board Meeting: The first step is to convene a Board meeting to discuss the proposed change and obtain approval from the Board of Directors.
    2. Pass a Resolution: The Board must pass a resolution to approve the proposed change and authorize a Director or Company Secretary to file the necessary forms with the Registrar of Companies (ROC).
    3. File Form MGT-14: The next step is to file Form MGT-14 with the ROC within 30 days of passing the resolution.
    4. File Form INC-24: Once Form MGT-14 is approved by the ROC, the company must file Form INC-24 within 30 days to update the MOA.
    5. Obtain Certificate of Incorporation: Upon approval of Form INC-24, the ROC will issue a new Certificate of Incorporation with the updated objectives or activities.

    Documents Required

    The following documents are required for changing the objectives or activities of a company:

    1. Board Resolution approving the change
    2. Copy of the amended MOA
    3. Form MGT-14
    4. Form INC-24

    Process

    The process of changing the objectives or activities of a company may take approximately 30-45 days, subject to the approval of the ROC.

    It is advisable to seek the guidance of a professional consultant to ensure a hassle-free and smooth process.

    We at Corporate Raasta Consulting have a team of experts who can assist you in changing your company’s objectives or activities with ease. Contact us today to know more!

    • The company should start by drafting a clear board resolution, ensuring that the proposed changes are legally compliant, and communicating with stakeholders. This is followed by convening a board meeting to discuss and pass the resolution.

    • A special resolution is passed during an EGM by presenting the resolution to the members, conducting a vote, and documenting the decisions. A notice containing all mandatory information must be circulated to the members beforehand.

    • Post-EGM formalities include filing the necessary documents with the Registrar of Companies (RoC), publicly disclosing the changes, and implementing the new objectives in the company’s operations.

    • A company may need to update its business model and brand strategy to align with new objectives, especially if it is entering new markets, introducing new products, or responding to changes in regulations.

    • Required documentation includes an updated Memorandum of Association (MoA), identity and address proofs of directors, and a register recording attendance at board meetings.

    • The company must stay informed about changes in government regulations and adjust its objectives accordingly to ensure compliance and manage associated risks.

    • Monitoring is crucial to track the effectiveness of the new objectives, manage the transition smoothly, and establish a feedback loop to keep the objectives relevant and successful.