oa Comparative and International Law Journal of Southern Africa - A company without a memorandum of association: policy implications
This paper examines the policy bases underpinning changes to Zambia's company law in terms of which the Companies Act 1994, companies are no longer required to have a memorandum of association. In particular, the paper concentrates on the lack of statutory obligation in the Companies Act 1994 for companies to have an objects clause. Underscoring the views expressed, the argument that whereas under the English Companies Act 1985 the doctrine of ultra vires has been abolished, the position under the Zambian Companies Act 1994 is somewhat unclear. In the United Kingdom, company directors will bind the company in transactions with third-parties no matter how far removed the transaction is from the company's usual business. The directors will bind the company provided that they are dealing with a bona fide party who has no notice of limitations on their powers, and that party has given value. In Zambia, provisions of the 1921 Zambian Companies Act, the statute which preceded the 1994 Zambian Companies Act, required every company incorporated under the 1921 law to have a memorandum of association. The Companies Act 1994, which repeals and replaces the 1921 Companies Act, is silent on the issue of a memorandum of association. One view is that the Companies Act 1994 has abolished the statutory requirements for a memorandum of association. This view is discussed in the article.
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