Articles of association, alteration of

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Updated: Aug 20, 2021

The articles may be altered by a special resolution at a general meeting. The alteration must be within the powers given by the memorandum of association. It must concern legal acts and must not be a fraud on a minority of shareholders: that is. it must be for the good of the company and must not be an attempt by the majority to take advantage of their position. Where alteration of the rights of any class of shareholders is concerned, the articles often provide that special class meetings must be held and that the consent of the class must be obtained. Where the rights are fixed by the memorandum, then if the method of alter ation is not specified it may be necessary to appeal to the court.

Reference: The Penguin Business Dictionary, 3rd edt.



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