Business Resolution

Business Resolution

What is a Resolution?

The matter of business that are transacted at a general meeting are presented in the form of motions. These motions are taken up for discussion and decision. If the motion is approved by the required majority of members present, it becomes a resolution.

Types of Resolutions

There are two types of resolution. There are:

1.       Ordinary Resolution

2.       Special Resolution

Ordinary Resolution

The resolutions which are passed at a general meeting by a simple majority are called ordinary resolutions. The votes can be cast by members or by proxy. The resolution can be passed either by show of hand or by poll.

Matters decided

The following matters can be decided by an ordinary resolution:

1.       Adoption of statutory report.

2.       Appointment of first directors who are liable to retire by rotation.

3.       Appointment of auditors and fixation of their remuneration.

4.       Appointment of a managing director.

5.       Removal of a director and appointment of a director in his place.

6.       Approval of final accounts.

7.       Alteration of share capital.

8.       Creation of reserve fund etc.

Special Resolution

A special resolution is one which requires at least 3/4th majority of the members voting on it at the General Meeting. The voting can be by a show of hands or by poll. A notice has to be given at least 21 days before the meeting in which a special resolution is passed. The notice must clearly state the resolution to be moved is a special resolution.

Purpose of Special resolutions

Special resolution is required to be passed for the following purposes:

1.       Alteration of a company’s name.

2.       Alteration of the objects clause in the Memorandum of Association.

3.       Alteration of the articles of the company.

4.       Reduction of share capital.

5.       Variation of shareholders rights.

6.       Change of registered office from one state to another state.

7.       Making the liability of directors unlimited.

8.       Voluntary winding up.

Distinction between ordinary and special resolution

Basis of distinction	Ordinary Resolution	Special Resolution
Majority	It can be passed with simple majority	It requires at least 3/4th majority for it to be passed.
Notice	Prior notice is not required for passing an ordinary resolution.	21 days notice must be given before the meeting in which such a resolution is to be passed.
Registration	It does not require to be filed with the Registrar.	A copy of the special resolution must be filed with the Registrar within 30 days from the date of its passing.
Objective	It is required to transact ordinary business.	It is required to transact special business.

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What is prospectus

What is Prospectus....?

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Conversion of Company's Status -1984

Conversation of Company's Status  Under Company Ordinance 1984

Pakistan Company ordinance 1984 has provision for companies to change / convert its status from private to public, single member to private company and vice versa. This can be done through alteration in Articles of Association. Following are the procedures for the conversation of the company.

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Incorporation Of Company-1984

Procedure for incorporation of a company under company ordinance 1984 of Pakistan.

Commonly there are two stages involved in incorporation of a company under the company ordinance 1984. Which are explained / stated below:

Stage 1:

In this stage, the availability of name for the company is checked with the concerned registrar under the section 37 of company ordinance 1984. The procedure for obtaining the name a letter is provided. Name availability can also be checked at the website of Security and exchange commission of Pakistan (SECP).

Stage 2:

In stage, all the required documents are prepared and filled with the concerned registrar. In stage there are two steps, which are explained below:

Step 1:

In the first step Documents especially Memorandum and Articles of Association are prepared.

Step 2:

In the second step all the required documents are filed. Which are explained in details below:

• Usually four or five copies of Memorandum and Articles of association are prepared duly signed by the subscriber and witness should be submitted. One copy of the document is affixed with adhesive stamp which is called Original copy. Along with the original copy three other copies are provided to registrar.
• Form 1: Form 1 is submitted, which consist of declaration of compliance.
• Form 21: Form 21 is submitted, which consist of the company location / address. The form should be submitted within 28 days.
• Form 27 / 28:  In case of public company, these forms are submitted, which are contains of list of directors to act as directors.
• Form 29: In form 29 Particulars of directors are submitted. This form should be submitted within 14 days.
• Form S1: In case of single member company, this form is submitted for nomination of director.
• In case of Financial Institution, Letter of Intents (LOI) or No Objection Certificate (NOC) issued by Ministry of Finance or SECP should also be submitted.
• A copy of Power of Attorney duly signed by subscriber to authorize the representative and to make any amendment or alterations in Memorandum and other document if required. The power of Attorney must be attested by notary public.
• Copy of the letter of availability of name for the company (in Stage 1) issued by registrar should be submitted.
• Copies of CNIC / Passport etc. of the subscriber should be submitted.
• Bank Challan of registration and filling fee of documents should also be submitted.

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