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Issues in Corporation Law

   

Added on  2020-03-15

11 Pages2724 Words48 Views
Running head: CORPORATIONS LAW0Corporations Law

CORPORATIONS LAW1Table of ContentsAnswer 1....................................................................................................................................2The Issue................................................................................................................................2Relevant Law.........................................................................................................................2Type of Companies................................................................................................................2Name of a Company...............................................................................................................2Selection of Registered Office...............................................................................................3Details of Consent and Shareholding.....................................................................................3Constitution or Replaceable Rules.........................................................................................3Filing of Application and Fees...............................................................................................4Impact of Incorporation and Requirements............................................................................4Applicability and Conclusion.................................................................................................4Answer 2....................................................................................................................................6The Issue................................................................................................................................6Relevant Law.........................................................................................................................6Main Legal Principle..............................................................................................................6Argument on the Facts...........................................................................................................6Supporting Case.....................................................................................................................6Sham or Façade Corporation..................................................................................................7CMS Wound Up.....................................................................................................................8Conclusion..............................................................................................................................8References..................................................................................................................................9

CORPORATIONS LAW2Answer 1.The IssueThe issue is regarding steps and provisions of company’s incorporations including, selection of name, office, and method of submitting application, rules, and impact of registration.Relevant LawThe arguments, in this case, will revolve around the sections of incorporating a company provided under the Corporations Act 2001. The sections include various provisions which founders have to follow while establishing a corporation.Type of CompaniesAs per the section 112 of Corporations Act 2001, there is two type of company, public, and proprietary (Act 2001). There are four types of public enterprises: No liability Unlimited share capital Limited by guaranteeLimited by shares Proprietary corporations are divided into two parts: Unlimited by shareLimited by share capitalName of a CompanyThe provision relating to the name of a company provided under section 148 of the act. The name selected by a new corporation must be available along with Australian Company Number. While incorporating a public enterprise, it is necessary that word ‘Limited’ is added at the end of the title. In case of a proprietary firm, the word ‘Proprietary Limited’ is required to be added in the end. The name of unlimited proprietary firms must add ‘Proprietary’ at the end of the title, and no liability organisations add ‘No Liability’ word in their title (Barrett 2010). The section 148 of the act requires that the name of an enterprise must not be identical or confusingly similar to another organisation’s title. This article also provides the regulations

CORPORATIONS LAW3regarding unacceptability of specific names which are rejected by ASIC or government departments. For example, a company cannot incorporate with the word ‘Federal’ or ‘Commonwealth’ in their title because it shows their connection to government, which can beconfusing for the public. The words or titles rejected by ASIC cannot be used by organisations as their name (Lipton 2007). Section 152 of the act provides provision regarding reservation of a name; an individual can check the availability of a title in National Names Index which is provided over the online website of ASIC (ASIC n.d.). It is necessary that such party must reserve the name by submitting an application in prescribed format to ASIC. ASIC reserve such name for two months, which can be extended by providing a written form for an extension for next two months.Selection of Registered OfficeAs per section 119A of the act, a company is required to select a registered office under its jurisdiction. The jurisdiction of corporations is situated in a particular state or territory. ASIC provides the name of company's registered office in its registration certificate. As per Cassidy(2006), the legal rights and abilities of a corporation did not change according to state or territory regulations. An enterprise adds its proposed registered office address in the application which became permanent address after the incorporations. Usually, corporations select a registration office near their place of working. As per section 144, it is compulsory for enterprises to write their name in front of the place of business. Details of Consent and ShareholdingThe corporations are required to provide their shareholding structure while applying for registration, which includes details regarding members and their shareholdings. The consent of each member is required for incorporation, whose name is written on the form or who has signed the application. This information must be correct and collected without any fraud by the company, and they must be submitted at the time of registration (McBurnie and Ziguras 2001). Constitution or Replaceable RulesAs per section 136, a company can adopt their constitution before or after their incorporations. The constitution includes a contract of director and other members of the corporation. The constitution provides guidelines regarding power and duties of directors and

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