Changing the objectives or activities of a company involves updating its business scope as defined in its constitutional documents. This is a significant process because it can affect the company’s operations, compliance requirements, and strategic direction. Here’s a comprehensive guide on how to change the objectives or activities of a company:

### **1. Understanding the Change in Objectives/Activities**

**Definition:**
- Changing the objectives or activities involves amending the company’s Memorandum of Association (MoA) to reflect new or modified business activities or goals.

**Importance:**
- This change is crucial for aligning the company’s operations with its new strategic direction, expanding into new markets, or modifying its business model.

### **2. Types of Changes**

1. **Addition of New Objectives:**
   - Introducing new business activities or purposes not previously included in the MoA.

2. **Modification of Existing Objectives:**
   - Changing the scope or nature of current business activities.

3. **Deletion of Objectives:**
   - Removing activities or purposes that the company no longer intends to pursue.

### **3. Procedure for Changing Objectives/Activities**

#### **Step 1: Board Meeting**

1. **Convene a Board Meeting:**
   - The board of directors should meet to discuss and approve the proposed changes to the company’s objectives or activities.

2. **Pass a Board Resolution:**
   - The board should pass a resolution to approve the changes and propose amendments to the MoA. This resolution will be required for further approvals.

#### **Step 2: Special Resolution**

1. **Call a General Meeting:**
   - Convene an Extraordinary General Meeting (EGM) of the shareholders to pass a special resolution for amending the MoA.

2. **Special Resolution:**
   - The special resolution must be passed by a majority of not less than three-fourths of the votes cast by the shareholders. This resolution will authorize the changes to the objectives.

#### **Step 3: File with Registrar of Companies (RoC)**

1. **Form MGT-14:**
   - **Form MGT-14 (Filing of Special Resolutions):** File this form with the RoC to submit the special resolution passed by the shareholders.
   - **Documents Required:**
     - Copy of the special resolution.
     - Copy of the board resolution.
     - Altered MoA reflecting the changes.
     - Notice of the general meeting.

2. **Form INC-24 (if applicable):**
   - If the change involves alteration of the company’s main objects, also file **Form INC-24 (Application for Approval of the Change of Object Clause)** with the RoC.

3. **Payment of Fees:**
   - Pay the applicable fees for filing the forms with the RoC.

#### **Step 4: Amend Memorandum of Association (MoA)**

1. **Prepare Altered MoA:**
   - Update the MoA to reflect the new or modified objectives or activities.

2. **Sign and File:**
   - Ensure that the altered MoA is signed by the authorized signatories and filed with the RoC along with the required forms.

#### **Step 5: Obtain Approval**

1. **RoC Review:**
   - The RoC will review the filed documents and may seek additional information or clarifications.

2. **Approval:**
   - Once the RoC is satisfied, they will approve the changes and issue a certificate of incorporation reflecting the updated MoA.

### **4. Post-Change Considerations**

1. **Update Company Records:**
   - Update all internal records, including statutory registers and company documentation, to reflect the changes.

2. **Notify Stakeholders:**
   - Inform relevant stakeholders, including banks, clients, suppliers, and regulatory authorities, about the change in the company’s objectives or activities.

3. **Update Business Licenses and Permits:**
   - If applicable, update any business licenses, permits, or registrations to align with the new objectives or activities.

### **5. Common Challenges**

1. **Regulatory Compliance:**
   - Ensuring that all regulatory requirements are met can be complex. It is crucial to comply with the legal framework to avoid penalties.

2. **Stakeholder Approval:**
   - Obtaining approval from all shareholders and addressing any objections can be challenging.

3. **Documentation Errors:**
   - Ensure that all forms and documents are accurately completed and filed to avoid delays or rejections.

### **6. Best Practices**

1. **Consult Professionals:**
   - Engage legal and accounting professionals to ensure compliance with all requirements and to handle complex issues.

2. **Clear Communication:**
   - Communicate clearly with all stakeholders about the changes to manage expectations and facilitate a smooth transition.

3. **Thorough Planning:**
   - Plan the change process thoroughly, including preparing for potential challenges and ensuring that all legal and procedural requirements are met.

4. **Update Internal Policies:**
   - Revise internal policies and procedures to align with the new objectives or activities.

### **7. Conclusion**

Changing the objectives or activities of a company involves a detailed and structured process that includes board and shareholder approvals, regulatory filings, and updates to company documents. By following the prescribed procedures, ensuring proper documentation, and seeking professional advice, a company can effectively manage this process and align its operations with its new strategic direction.

Change Objective/Activity Fees