Corporation Law of Australia

Question: Discuss about the Corporation Law of Australia. Answer: Introduction There are certain methods and procedures to be followed for the formation a company. For determining the framework of a company certain legal obligations have to be met with. According to Section 112 of the Corporations Act, 2001, companies are divided into proprietary companies and public company. However the focus will remain on proprietary companies, its formation and registration process. Proprietary companies can be further divided on the basis of shares. They may be either limited by shares or have unlimited share capital. Registration of a Proprietary Limited Company A proprietary company is discussed at length. The requirement for a proprietary company is to have at most 50 shareholders who are not employees of the proprietary company in order to- Register itself as a proprietary company. Change itself into a proprietary company. Continue to remain as a proprietary company. Certain constraints and regulations have to be followed in order for a proprietary company to be formed like- One of the directors should be living in Australia. A registered office and address should be there in Australia for the purpose of registration. One of the company secretaries should be living in Australia. By limited it means the liability to pay debts by the shareholders is in combination with the amount of shares held by them. As per Section 117 of the Corporations Act, 2001, a method of registration for a company to form is given (Austlii.edu.au, 2016). There is a registration form which requires the following details- The nature of the company which is purported to be registered within this Act. The decided name of the company unless the name becomes the Australian Company Number. Members name and addresses. Details of the person who gives assent to become director like family name, date and place of birth. Details of the person who gives assent to become the company secretary like family name, date and place of birth. The person who assents to become the director or company secretary, his or her address. The address to which the office of the company is registered. The decided opening time for the proprietary company. For a company to be registered under the Australian Securities and Investment Commission, a number is given to the company known as Australian Company Number (ACN). The number should be present in- Common seal and other seals of the company. Documents publicly issued, published or signed at the instance of the company. On the behalf of the company, negotiable instruments signed, issued or published. Documents to be presented to the ASIC as per the Act. A proforma of a registration form can be shown as below- COMPANY NAME JABY PROPRIETARY LIMITED COMPANY ADDRESS 8/C, WINSLOW AVENUE, NSW, AUSTRALIA-2055 PROPRIETORS NAME ERIC LASHLEY RESIDENTIAL ADDRESS OF PROPRIETOR 2/Y, ROLAND STREET, NSW, AUSTRALIA-2055 Section 169 of the Corporations Act, 2001, says that when a company has more than 50 members an index of their names should be there (Austlii.edu.au, 2016). A share register is to be maintained which will contain- Class of share and the amount held by the member. Date of the allotted share. Amount of shares allotted to each member. Fact as to whether the shares are fully paid or not. If shares are not fully paid, how many unpaid shares are there. Displaying the share certificates of the shares. Section 134 of the Corporations Act, 2001, internal governance is discussed as to the manner how the domestic environment is to be administrated (Austlii.edu.au, 2016). Section 135 of the Act takes into consideration the replaceable rules. A company may use the rules as it matches with the local management (Austlii.edu.au, 2016). According to Section 140 of the replaceable rules apply to the company as a contract between- Company and employees. Company, directors and the company secretary. The members themselves. Sub section 2 of Section 254A of the Act talks about the power to issue preference shares considering the fact that rights pertaining preference shares are there in the constitution of the company in these matters- Pay back of capital. Using excess assets and profits. Cumulative and non cumulative dividends. Voting matters. Deciding the order in which dividends and capital in relation to other shares or classes of preference shares (Austlii.edu.au, 2016). According to Subsection 3 of Section 254A of the Act redeemable preference shares that are issued with a condition of redemption (Austlii.edu.au, 2016). This happens- When a particular time span is given or subject to happening of an incident. If company wishes to do so. If the shareholder wants to do so. References Austlii.edu.au. (2016).Corporations Act2001 - SECT 117. [online] Available at: https://www.austlii.edu.au/au/legis/cth/consol_act/ca2001172/s117.html [Accessed 16 Sep. 2016]. Austlii.edu.au. (2016). Corporations Act2001 - SECT 134. [online] Available at: https://www.austlii.edu.au/au/legis/cth/consol_act/ca2001172/s134.html [Accessed 16 Sep. 2016]. Austlii.edu.au. (2016). Corporations Act2001 - SECT 135. [online] Available at: https://www.austlii.edu.au/au/legis/cth/consol_act/ca2001172/s135.html [Accessed 16 Sep. 2016]. Austlii.edu.au. (2016). Corporations Act2001 - SECT 169. [online] Available at: https://www.austlii.edu.au/au/legis/cth/consol_act/ca2001172/s169.html [Accessed 16 Sep. 2016]. Austlii.edu.au. (2016). Corporations Act 2001 - SECT 254A. [online] Available at: https://www.austlii.edu.au/au/legis/cth/consol_act/ca2001172/s254a.html [Accessed 16 Sep. 2016].