For a company formed under the Companies Act 2006, the memorandum of association is a short, fixed document in which the subscribers state that they wish to form the company and agree to become members, taking at least one share each if the company has a share capital. It no longer contains the company’s rules. For older companies, everything else in the memorandum, including any objects clause and any authorised share capital, is now treated as part of the articles and can be changed in the same way as the articles.

What does a modern memorandum actually say?

Section 8 of the Companies Act 2006 defines the memorandum as a memorandum stating that the subscribers wish to form a company under the Act and agree to become members of it, and, for a company with a share capital, to take at least one share each. It must be in the prescribed form and authenticated by each subscriber. The prescribed forms are in the Companies (Registration) Regulations 2008: Schedule 1 for a company with a share capital and Schedule 2 for a company without one, such as a company limited by guarantee.

The information that used to sit in the memorandum now goes in the application for registration under section 9, which must state the proposed name, whether the registered office is to be in England and Wales (or Wales), Scotland or Northern Ireland, whether the members’ liability is limited by shares or by guarantee, whether the company is private or public, and that the subscribers wish to form the company for lawful purposes. The memorandum is delivered alongside that application, the statement of compliance and the other registration documents. See how to incorporate a limited company.

The explanatory notes to the 2006 Act describe the new memorandum as a document of purely historic significance, evidencing an intention to form a company, and state that it will not be possible to amend or update the memorandum of a company formed under the Act. The company’s internal rules belong in its articles.

What did an old style memorandum contain?

Under section 2 of the Companies Act 1985 as originally enacted, the memorandum had to state the company’s name, whether its registered office was to be in England and Wales or in Scotland, and its objects. A company limited by shares or by guarantee also had to state that its members’ liability was limited, a guarantee company had to state the amount each member undertook to contribute on a winding up, and a company with a share capital had to state the amount of share capital it proposed to register and its division into shares of a fixed amount. That last item was the authorised share capital.

Many older companies still have these memoranda on the public register, and they still have legal effect, but not as a memorandum.

How are old objects clauses treated now?

Section 28 provides that provisions which were in a company’s memorandum immediately before Part 3 of the 2006 Act came into force, and which are not of the kind a new style memorandum contains, are treated from then on as provisions of the company’s articles. This covers substantive provisions and any provision for entrenchment. So an old objects clause did not disappear: it became a restriction in the articles.

That has a practical consequence. Section 31(1) says a company’s objects are unrestricted unless its articles specifically restrict them. A company formed after the 2006 Act took effect will usually have unrestricted objects. An older company whose memorandum listed its objects still has restricted objects, because those objects now sit in its articles, until it removes them.

Section 39 provides that the validity of an act done by a company cannot be called into question on the ground of lack of capacity because of anything in its constitution. Section 40 provides that, in favour of a person dealing with the company in good faith, the directors’ power to bind the company is deemed free of any limitation under the constitution, and that person is not bound to enquire about such limitations. The position on authority is explained further in directors’ authority to bind the company.

Inside the company, objects still count. Section 40(4) preserves a member’s right to bring proceedings to restrain an act beyond the directors’ powers, section 40(5) preserves any liability the directors incur by exceeding their powers, and section 171 requires a director to act in accordance with the company’s constitution. A director who moves an old company into a business its objects clause does not cover is acting outside the constitution, which is one of the general duties of directors.

Charities are treated differently. Under section 42, sections 39 and 40 do not apply to the acts of a company that is a charity except in favour of a person who does not know at the time that the company is a charity or who gives full consideration in money or money’s worth.

How does a company remove or change its objects?

Because the objects are now part of the articles, they are changed by amending the articles, which section 21 allows by special resolution. Section 31(2) then adds a filing step: where a company amends its articles to add, remove or alter a statement of its objects, it must give notice to the registrar, and the amendment is not effective until that notice is entered on the register. Companies House guidance states that the notice is given on form CC04 and that the company must also file a copy of the resolution and the revised articles within 15 days. Section 26 separately requires a copy of the amended articles to be sent to the registrar not later than 15 days after the amendment takes effect. See filing resolutions at Companies House for the mechanics.

Some companies need more than a special resolution. Under section 31(4) and section 21(2), for a charitable company in England and Wales these rules take effect subject to sections 197 and 198 of the Charities Act 2011. A community interest company altering its objects uses the CIC Regulator’s form CIC14, because its objects tie into the community interest test described in community interest companies.

If the old memorandum contained provisions that could not be altered, section 28(2) treats that as provision for entrenchment in the articles. Section 22 allows entrenched provisions to be changed by agreement of all the members or by order of a court or other authority with power to alter the articles.

What happens to authorised share capital in an old memorandum?

The 2006 Act abolished authorised share capital for new companies, but a cap in an old memorandum did not lapse. Paragraph 42 of Schedule 2 to the Companies Act 2006 (Commencement No. 8, Transitional Provisions and Savings) Order 2008 provides that a provision of a company’s memorandum as to the amount of its authorised share capital in force immediately before 1 October 2009 is treated from that date as a provision of the articles setting the maximum amount of shares the company may allot. It may be amended or revoked by ordinary resolution, and the rules in Chapter 3 of Part 3 on resolutions affecting the constitution apply, so the resolution must be filed.

Directors of an older company therefore need to check this figure before any allotment, alongside their authority to allot under section 550 (a private company with one class of shares) or section 551 (authority given by the articles or by resolution).

How does this work for an older company?

Illustration only. A company formed in 1998 has a memorandum with an objects clause limited to building work and an authorised share capital of 1,000 ordinary shares of £1, of which 100 are issued. It now wants to issue 2,000 new shares to an investor and start a property letting business.

  • The authorised capital cap of 1,000 shares is treated as a limit in the articles, so it must be revoked by ordinary resolution, or new articles adopted, before the allotment.
  • The objects clause is treated as part of the articles. A special resolution removing it is needed, followed by form CC04. The change takes effect only when Companies House registers the notice.
  • The directors confirm they have authority to allot, then file a return of allotment, which section 555 requires within one month of the allotment.

Many companies in this position adopt a full new set of articles and state in the resolution that the provisions of the memorandum treated as articles under section 28 are removed, so nothing from the old document survives by accident.

What mistakes come up most often?

  • Trying to amend the memorandum of a company formed under the 2006 Act. It cannot be updated; the change belongs in the articles.
  • Assuming an older company has unrestricted objects because it was formed under the Companies Acts. Its old objects clause still restricts it through section 28 until removed.
  • Passing the special resolution to change objects but not filing form CC04, so the change never takes effect.
  • Allotting shares beyond an old authorised capital figure without first revoking it by ordinary resolution.
  • Treating the memorandum as the place to look for a company’s rules. For any company, the current articles and resolutions affecting the constitution, which section 17 defines as part of its constitution, are what govern it. The wider picture for an ordinary trading company is set out in private companies limited by shares.

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Sources

Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 8 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.