Law of Business Organization Report

This report examines the legal aspects of business organization in Australia, covering the registration process for public companies, the issuance of preference shares, and the procedures for calling a members' meeting and appointing a new director. It provides a comprehensive overview of the relevant legal frameworks and case law.

Law of Business
Organization

Table of Contents
INTRODUCTION...........................................................................................................................1
PART 1............................................................................................................................................1
Registration of public company..................................................................................................1
Preference shares section 254A(2)..............................................................................................2
Documents required to call a members meeting and appointment of a new director to the
company board............................................................................................................................2
CONCLUSION................................................................................................................................3
REFERENCES................................................................................................................................4

INTRODUCTION
Establishing a business organisation as company requires registration under companies
act by filling the required forms. Companies are private and public and registration of
organisation as public company needs to file Form 201. Operations of a public company are
performed by directors who work as managers to the business. Appointment of director is done
in general meeting by members. In this report whole process of registration of public company
and appointment is mentioned (Allen and Kraakman, 2016).
PART 1
Registration of public company
To register a public company in Australia person must lodge an application with
Australian Securities and Investment Commission (ASIC). The application must contain type of
company that is proposed to be registered with proposed name of the company. Name and
address of each person who provides consent to become a member. Present given and family
name, all former given and family name and date, place of birth of the person becoming member
and company secretary of the organisation must be mentioned in the form. Consent and name of
each person becoming director and address of registered office of the company must be
mentioned in the registration form. Opining hours of registered office and principal place of
business (if registered office address is not present). Full information in regards to company
limited by shares or unlimited. Class of shares on which each member agree to take up and
amount paid on the shares and information regarding unpaid amount of shares is mentioned in
registration form of the company. All these information must be filled in FORM 201 available at
ASIC online site. When the form is submitted it will take less then 10 minutes to get registered
as company in Australia but exception to this is where ASIC needs to take manually review of
companies name (Bubb, 2014).
A public company structure requires minimum one shareholder and no maximum number
of members. For directors, there must be at least three directors and at least two of whom must
be ordinarily reside in Australia. When all the required criteria for registration is fulfilled and
name of the company is note same as other existing company then certificate of incorporation
will be provided. Together with this Australian Company Number will be provided that helps in
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registration under tax regulations of the country. From the day of incorporation of the company
status of separate legal entity will be enjoyed by the company.
Preference shares section 254A(2)
Preference shares is a class of shares that takes a preference over another class of shares.
When the company was incorporated different types of preference shares can be issued by the
company. Such as convertible preference shares, these shareholder do not posses any voting
rights and carried preference over other class of shares. These shares are converted into any other
security of the company after a specific period of time. Redeemable preference shares have no
voting rights but get preferential payments before other securities other then convertible
preference shares. These shares are issued for a specific period of time and get redeemed after
completion of the time period .
A company getting registered under Corporation Act can have members who hold
preference shares constituting one hundred percent of its issued shares. There is no requirement
as per the act to have ordinary shares that needs to be issued for redeemable preference shares.
Beck v Weinstock [2013], deals with the question whether preference shares could be validly
issued by a company that had not issued ordinary shares (Beck v Weinstock, 2013). It was held in
the case that company could be issued or continue to exist even if there are no ordinary shares on
issue.
Documents required to call a members meeting and appointment of a new director to the
company board
Annual general meeting (AGM) is a mandatory yearly gathering of a company's
members/ shareholders. This is primarily held to allow shareholders to vote on issues related to
company and for appointment of board of directors of the company. This meeting is attained by
shareholders personally or by proxy. Public companies must file annual proxy statements to
appoint a proxy. Articles of association of the company contains rules and regulation governing
AGM of the company. To call a general meeting a notice to all registered shareholders of the
company who have right to vote in the meeting will be send. This notice is sent at the registered
address of the members and also information is provided at their registered mail address. In the
notice for general meeting date, time, venue of the meeting will be disclosed. Together with the
issued that are to be discussed in the meeting is also mentioned in the notice (André, 2012).
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A director in a public company is appointed by all the members that are present and
voting in the general meeting of the company. In AGM members are provided with certain
names of qualified persons who are eligible to be appointed as director of the company and
already provided their consent. Members at the meeting give their vote to director and a person
gets majority votes will be appointed as director of the company. Appointment of board of
director will be done by passing a resolution in the general meeting. After completion of the
meeting minutes of the meetings are prepared (Macaulay, 2018). These minutes contain full
information regarding agendas that are discussed in the meeting and decision in regarding to a
particular issue.
CONCLUSION
From the above report it is concluded that registration of public company in Australia
involves simple process. A form prescribed by ASIC is filled and submitted online and if all the
requirements are met the certificate of incorporation is granted. A company can issue range of
preference shares to rise capital without issuing any ordinary shares. Each public company needs
to have one AGM in every financial year. To call meeting of members a notice of the meeting is
sent to all the registered members of the company. A director of the company is also appointed in
the general meeting by members who can vote in the meeting.
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REFERENCES
Books and Journals
Allen, W. T. and Kraakman, R., 2016.Commentaries and cases on the law of business
organization. Wolters Kluwer law & business.
Macaulay, S., 2018. Non-contractual relations in business: A preliminary study. In The Law and
Society Canon (pp. 155-167). Routledge.
Bubb, R., 2014. Choosing the Partnership: English Business Organization Law During the
Industrial Revolution. Seattle UL Rev. 38. p.337.
André, R., 2012. Assessing the accountability of the benefit corporation: Will this new gray
sector organization enhance corporate social responsibility?. Journal of Business Ethics.
110(1). pp.133-150.
Online
Beck v Weinstock. 2013. [Online]. Available through:
<https://www.lexology.com/library/detail.aspx?g=60e97349-4060-4f9a-8d4f-
6d16f898f820>
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