For some time now, I have been thinking about starting a business and last night I got into thinking all about how to go about doing it. The first thing obviously is to find out what is required to start a new business in India. Searching on the topic yielded the following results -
The first link lays out 13 steps that need to be done for registering a new business along with indicative times and cost for each step. The second confirms the process and discusses it in a little more detail.
Two documents that are required and that can be done upfront are the MOA (Memorandum of Association) and AOA (Articles of Association).
The purpose of the MOA is to communicate to the public the state of affairs of the company and its purpose of being and operating. This aids various stakeholders of the company (creditors, suppliers, shareholders, etc.) to evaluate the extent of their risk and also possibilities of the company to overcome them at a future date. A memorandum of association is required to state the name of the company, the type of company (such as public limited company or private company limited by shares), the objectives of the company, its authorised share capital, and the subscribers (the original shareholders of the company). A company may alter particular parts of its memorandum at any time by a special resolution of its shareholders, provided that the amendment complies with company law.
The articles of association of a company are the regulations governing the relationships between the shareholders and directors of the company, and are a requirement for the establishment of a company. Together with the memorandum of association, they form the constitution of a company. Articles of association typically cover the issuing of shares (also called stock), the different voting and dividend rights attached to different classes of share, restrictions on the transfer of shares, the rules of board meetings and shareholder meetings, and other similar issues. A company is free to amend its articles of association at any time by a special resolution of its shareholders, provided that they meet the requirements and restrictions of the Companies Acts.
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