Constitution Of A Company

The constitution of a company acts as a contract between the company and its members, as well as among the members themselves. It has replaced the Memorandum and Articles of Association. Although not mandatory, certain entities such as LLCs, companies in migration, amalgamated companies, or foreign companies seeking registration must have a constitution.

A company with a constitution adheres to the same guidelines as those without one, except where the constitution restricts or modifies these guidelines. Companies registered under the Companies Act 1984 may continue using their existing Memorandum and Articles of Association, which will serve as the company’s constitution.

In the absence of a constitution, a company is governed by the provisions of the Companies Act. Alternatively, shareholders or members can adopt a constitution through a special resolution.

Annual Shareholders’ Meeting

An annual meeting of shareholders must be held once each year. This meeting must occur no later than six months after the balance sheet date and no more than 15 months should lapse between two annual meetings. This ensures that shareholders have a regular opportunity to discuss the company’s performance, elect directors, and make key decisions.

Formation Costs

Since the Companies Act does not require a company to have a constitution, it does not need to be embodied in a notarized deed but must be certified by a law practitioner. The primary cost of formation is the Registrar fees, ranging from MUR 2,000 to MUR 100,000. Additionally, there is a processing fee of MUR 2,000. Fees are also charged for every document lodged within the time limits prescribed by the Act.

By understanding these requirements and costs, companies can ensure compliance with legal standards and effective governance.