Quite often, the first step a foreign investor would take in setting up a structure in UAE is finding a local partner who will own the majority interest of the company. Among the specific requirements fulfilled by an international entrepreneur when opening a company in UAE, drafting and notarizing memorandum and articles of association
is an important matter.
Our Dubai lawyers
can offer complete information on the steps required in setting up a business in UAE.
Meaning of the articles of association of a UAE company
The articles of association are a document that presents the regulations for a company's operations, defining the company's purpose. It is also laying out how tasks will be accomplished within the structure, including appointment directors' process and how financial records will be managed.
Articles of association of a UAE company
often identify the way in which an organization will pay dividends, issue stock shares,audit financial records and power of voting right. This document is actually a set of rules which can be considered a user's manual for the company because they highlight the methodology for accomplishing the tasks that must be completed on a daily basis. If interested in drafting articles of association
and any other requirements for setting up a business in UAE, feel free to contact our Dubai law firm
The difference between memorandum of association and articles of association of a UAE company
All the companies in the UAE
have their own memorandum of association and articles of association. The first one, memorandum of association (MOA)
is the root document of the company, containing all the basic details about the company. Articles of association (AOA)
is also a major document which contains all the rules and regulations of the company. In any contradiction between the memorandum and articles, no matter the clause, memorandum of association will prevail over the articles of association.
Memorandum of association contains the information about the objects and powers of the company whereas articles of association contain information about the company rules. From another point of view, memorandum of association is subsidiary to the company act, while articles of association are subsidiary to both company act and memorandum of association. Moreover, MOA must contain the six clauses whereas AOA is framed as per the company's discretion.
Obligatory to be registered with the registrar of companies, memorandum of association is opposed to articles of association, which is not required to be filed with the registrar, thus the organization may file it voluntarily.
For more details on the matter of articles of association for your company in UAE
, ask for the help and assistance of our Dubai attorneys