How is a Limited Company Formed?

The earliest stage of forming a limited company includes submitting a Memorandum to the Companies House. Such documents must outline the objectives of the company and its name, and its nominal capital. It must be indicated also whether it is a limited liability company, or any other form of ownership, as well as specified country of incorporation.

For their part, the Companies House will then deliberate in the classification of the said company, whether it is general, commercial in nature or not, and check that the intended name is not among the registered Ltd. and LLC organizations. The trademarks index is also checked, particularly for companies with trade pursuits, with certain word choices needing approval from the Secretary of State.

The said Memorandum usually contains two initial shareholders, along with their names, contact details and the company shares. These two subscribers will be allowed one share, and they become automatic members of the limited company once it is registered. After incorporation, more shares may be issued up to the same figure with the company's nominal capital, provided the final Memorandum requirements has been fulfilled, dated and bears the signatures of the subscribers and one witness.

The limited liability businesses or organizations must also have their Articles of Association. This guidebook contains the internal rules of the company, to include powers of shareholders to directors, voting rights of directors and proxy voting, procedures for board and general meetings, and shares and profits. Over the years, some limited liability companies or LLCs have modified their original Articles to specifically meet the growing needs or changes. Just the same, the guidebook must bear the signatures of subscribers and be printed in the Memorandum.

Along with the Memorandum, Articles and other business requirements and legal documents that have been approved must be then served at the registered office of the limited company. It must be signed by the subscribers, dated and bear the signature of a witness, and then printed in the Memorandum as well.

The companies also have the option to use the registered address, or use another place like its actual site of business, or the address of their solicitor or auditor. Such could be indicated when Form 10 is supplied, along with details of the first directors and the company's first secretary like names and other personal details needed for legal purposes and documentation, addresses, business or occupations and previously held director positions. Solicitors and subscribers forming the limited liability company must inscribe signatures as well in the Memorandum.

Another important obligation for forming a limited company would be the Form 12. This document is a statutory declaration that formally confirms fulfillment of Companies House requirements in forming a company. The director, secretary or the solicitor who initiated formation of the company may prepare and confirm the statutory declaration. At the same time, the same document must be sworn before a solicitor or commissioner of oaths.

Jim F. Roberts has been expertly writing articles for 5 years on a variety of topics of interest. He finally discovered that starting a business requires a good knowledge on the types of company formations like solo ownership, Ltd., LLC, Limited Company and all the requirements in a business start-up.