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Memorandum of Association
I need a Memorandum of Association for a new limited liability company in the UAE, detailing the company's objectives, share capital, and the responsibilities and powers of the directors and shareholders, in compliance with UAE Commercial Companies Law. The document should also outline the procedures for amending the memorandum and the process for resolving disputes among shareholders.
What is a Memorandum of Association?
A Memorandum of Association is a key legal document that officially establishes a company in the UAE. It outlines the fundamental rules for running the business and defines its relationship with shareholders. This document spells out essential details like the company's name, objectives, registered office location, and share capital structure.
Under UAE Company Law, every mainland and free zone company must have this founding document before starting operations. It sets clear boundaries for what the business can do, helps protect shareholder interests, and serves as a reference point for resolving internal disputes. The memorandum also plays a crucial role when companies need to secure licenses, open bank accounts, or enter into major contracts.
When should you use a Memorandum of Association?
You need a Memorandum of Association when starting any company in the UAE, from small mainland businesses to free zone enterprises. This document becomes essential during company registration with the Department of Economic Development or free zone authorities. It's a mandatory first step before you can obtain your trade license, open corporate bank accounts, or begin commercial operations.
The memorandum proves particularly valuable during major business decisions like expanding operations, changing ownership structure, or seeking investment. Having this document properly drafted from the start helps avoid costly legal complications later, especially when dealing with shareholder disputes or regulatory compliance issues. UAE authorities require an updated memorandum for any significant changes to your company structure.
What are the different types of Memorandum of Association?
- Memorandum Of Association For Sole Proprietorship: Simplified version for single-owner businesses with streamlined governance requirements
- Memorandum Of Association Of Any Company: Standard template adaptable for most business types with comprehensive provisions
- Memorandum Of Association Of A Real Estate Company: Specialized version with property-specific clauses and RERA compliance elements
- Articles Of Association And Memorandum Of Association: Combined format required for larger companies with complex governance structures
- Memorandum Of Association And Articles Of Association Of A Company: Comprehensive package with detailed operational and management provisions
Who should typically use a Memorandum of Association?
- Company Founders: Sign and submit the Memorandum of Association during initial registration, setting core business parameters and ownership structure
- Legal Consultants: Draft and review the document to ensure compliance with UAE Company Law and relevant free zone regulations
- Shareholders: Bound by the memorandum's terms regarding capital contribution, profit sharing, and voting rights
- Company Directors: Must operate within the powers and limitations outlined in the document
- Government Authorities: Review and approve the memorandum during company registration and major corporate changes
- Corporate Banks: Rely on the memorandum to verify company structure and authorized signatories
How do you write a Memorandum of Association?
- Basic Details: Gather company name options, intended business activities, and proposed registered office address
- Capital Structure: Determine share capital amount, types of shares, and allocation among shareholders
- Ownership Information: Collect passport copies and Emirates ID of all shareholders and directors
- Business Scope: List specific activities allowed under your chosen license type
- Local Partner Details: Confirm UAE national sponsor arrangements if required for mainland companies
- Authentication Plan: Schedule notarization and translation of documents for legal registration
- Digital Draft: Use our platform to generate a legally-compliant memorandum template tailored to UAE requirements
What should be included in a Memorandum of Association?
- Company Name: Full legal name in Arabic and English, matching trade license application
- Business Objectives: Detailed description of permitted commercial activities under UAE law
- Share Capital: Total capital amount, number of shares, and value per share in UAE dirhams
- Shareholder Details: Names, nationalities, and ownership percentages of all shareholders
- Management Structure: Powers and responsibilities of directors and managers
- Registered Office: Official company address within UAE jurisdiction
- Duration: Company lifespan (usually specified as indefinite)
- Dissolution Terms: Procedures for winding up the company
- Governing Law: Statement confirming UAE law application and jurisdiction
What's the difference between a Memorandum of Association and a Model Articles of Association?
The Memorandum of Association and Model Articles of Association are often confused in UAE company formation, but they serve distinct purposes. While both are founding documents, they function differently in establishing and running a company.
- Scope and Purpose: The Memorandum defines the company's relationship with outside stakeholders and fundamental parameters like capital structure, while Articles govern internal management and shareholder relationships
- Legal Requirements: UAE law mandates both documents for company registration, but the Memorandum rarely changes once filed, whereas Articles can be amended as operational needs evolve
- Content Focus: The Memorandum states what the company can do and its basic structure, while Articles detail how it will operate day-to-day
- Modification Process: Changing the Memorandum typically requires regulatory approval, but Articles can often be modified through shareholder resolutions
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