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However, it should be noted that a failure to do so would amount to a breach of the directors’ general duty to ensure that the Act is complied with by the company (Section 223(1)), which may be actionable either in its own right or in connection with an application by a member or creditor for relief under Section 62.

Unlike the case of a company that adopts a new-form constitution by special resolution, the form of a constitution prepared by directors is strictly governed by the Act.

The Companies Act 2014 (the “Act”[1]) was signed into law in December 2014 and is expected to commence with effect from 1 June 2015.

The Act presents a number of drafting options and challenges for private companies deciding to adopt new-form constitutions.

After expiry of the transition period, a LTD may adopt a new-form constitution either: (i) Deemed constitution While the form and appearance of a deemed constitution will be identical to the existing memorandum and articles of association on which it is based, such a constitution will be interpreted as if the objects clause and any entrenching provisions in its memorandum did not exist.

The remainder of the provisions of its memorandum and articles will continue to apply.

However, it is worth noting certain differences between the provisions of Table A and the ways in which they have been incorporated as optional provisions in the Act.

(i) Adoption of an altered memorandum and articles of association upon re-registration as a DAC It is a requirement for re-registration of an existing private company as a DAC, that the company’s memorandum and articles of association must be altered in the following manner: With the foregoing exceptions, the form of the constitution of a new-form DAC will be the same to the form of a memorandum and articles of association under the current regime.

In many respects, this list will resemble similar lists in the articles of existing companies that have adopted Table A in modified form.

In this respect, the disapplication of optional provisions of the Act resembles the disapplication of Table A provisions by an existing company.

(ii) Deemed constitution Where a company does not deliver a new-form constitution to the CRO for registration during the transition period, it is deemed to have a new-form constitution in place of its existing memorandum and articles, which constitution comprises: While the appearance of such a constitution will be unchanged, it will be deemed to satisfy the requirements of Section 19 as to the form of a company’s constitution.

(iii) Preparation of a new-form constitution by the directors The directors of an existing private company are obliged during the transition period to prepare a new-form constitution, circulate it to members and deliver it to the CRO for registration, unless the company either: No offence is specified for a failure by the directors to prepare a new-form constitution.

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