Company Law Quiz

Membership Prohibitions and Requirements

• Individuals who are undischarged bankrupts are prohibited from being members of a company.
• A person convicted of crimes related to fraud or dishonesty typically cannot become a company member.
• Minimum of seven members is required to form a public company.

Unique Identification for Directors

• Directors must obtain a Director Identification Number (DIN) for their official identification in company records.
• The DIN is a unique numeric code issued by the relevant authority for all directors.

Proxies and Voting

• Proxies can vote on behalf of members at company meetings when instructed to do so by the member.
• This provision allows members unable to attend meetings to still participate in decision-making processes.

Appointment of Company Secretary

• A Secretary of a company can be any individual who is a qualified professional or holds relevant experience in company management.
• There are no specific legal qualifications required, but a knowledge of corporate governance is essential.

Shareholder Liability

• In a public limited joint stock company, shareholders have limited liability, meaning they are only responsible for company debts up to the amount unpaid on their shares.
• This protects personal assets from being used to settle company debts.

Public Subscription Invitations

• An invitation to the public to subscribe for shares in a company is known as a prospectus.
• This document provides details on the company, its operations, and the investment's terms and risks involved.

Non-Member Entities

• Corporations, companies limited by guarantee, and certain public institutions cannot be members of a company.
• Only individual persons or agreed entities can typically hold membership.