Incorporating a Company

by The FindLaw Team

Companies may be incorporated with limited or unlimited liability. Operating through a limited liability company allows businesses to limit shareholders’ liability. Several steps are required to incorporate a company. The steps are the same for both limited and unlimited liability companies. They are explained below.

Step 1 – Reserving a Company’s Name

The first step in the incorporation process is reserving a company name.  A company name can be reserved by completing a special application form.  Applications can be completed online at www.companies.govt.nz.  Alternatively,  applications can be sent by post, or delivered in person, to the Companies Office. Applications can be lodged by the applicant, or through a lawyer, accountant or other agent.  The Companies Office charges a fee for reserving a company name.

There are restrictions on the names that can be reserved for a company. A name cannot be reserved if it would break any law, or if the Registrar of Companies considers it offensive. In addition, a name cannot be reserved if it is identical (or almost identical) to the name of another company, or a name that has already been reserved.  The name of a limited liability company must end with the word “Limited”, or  “Tapui (Limited)”.

Step 2 – Registering a Company

Once a company name has been reserved, the second step in the incorporation process is to apply for registration of the company. An application for registration must state the full name and address of each director, shareholder and applicant. It must state the number and class of shares to be issued to each shareholder. It must also give the company’s name, registered office and address for service.

An application for registration of a company must be accompanied by a signed director’s certificate and consent for every director. It must also be acccompanied by a consent signed by every shareholder. A notice from the Registrar of Companies, confirming that the company’s name has been reserved, must also  accompany the application. If the company is to have a constitution when it is registered, a signed copy must also be lodged with the application.

A completed application for registration, together with the supporting documents, can be lodged with the Companies Office by the applicant. Alternatively, a lawyer, accountant or other agent can lodge an application for the applicant. The Companies Office charges a fee for registering a company.

A company must be registered within 20 working days of the date given in the Registrar’s notice of  reservation of the company’s name.

There are four fundamental requirements that must be satisfied in order for a company to be registered.  A  company must have a name. A company must also have at least one share, at least one shareholder, and at least one director. A company no longer requires a company secretary, or a company seal.

A company’s shares and shareholders

Shares in a company must not have a nominal or par value.  A company can issue different classes of shares.  Ordinary shares generally confer rights to vote, to receive dividends, to attend shareholder meetings, to exercise shareholder powers, and to share in distributions of company assets. Special classes of shares may confer restricted rights. For example, shares may be issued as non-voting shares. 

There are usually no special requirements for holding an ordinary share in a company, but as a general rule, subsidiary companies cannot hold shares in their parent companies. A person is a shareholder of a company if that person is named as a shareholder in the company’s application for registration, or if that person’s name is entered in the company’s share register as the holder for the time being of one or more shares.

Company directors

Special requirements apply to company directors.  Every director of a company must be at least 18 years old. A company cannot appoint a director who is an undischarged bankrupt, or who is prohibited by law from being a director or managing a company, or who is subject to an order under the Protection of Personal and Property Rights Act 1988, or who is disqualified under the company’s constitution.  Every director of a company must sign a consent and non-disqualification certificate before being appointed.

Only a natural person can be appointed as a director of a company. A company or other legal entity cannot be appointed as a director of a company.

A company’s registered office and address for service

An application to register a company must state the company’s registered office. A company’s registered office must be at a physical address in New Zealand. If a company’s registered office is in a building occupied by others, the location of the registered office within the building must be stated.

An application to register a company must also state the company’s address for service. A company’s address for service can be the same address as its registered office. However, it can be a different address. A company’s address for service must also be at a physical address. If it is in a building occupied by others, the location of the address for service within the building must again be stated. A postal centre or document exchange cannot be used as a company’s address for service.

Company constitutions

A company can adopt its own constitution.  It does not have to do so. A company constitution sets out the rules that govern what the company can and cannot do.

If a company has its own constitution, it can modify some (but not all) the rules that otherwise apply to the company under the Companies Act 1993. If a company does not have its own constitution, all the Companies Act 1993 rules apply automatically to the company. 

 

A company’s constitution cannot contain rules that are inconsistent with, or in breach of, the Act. There are some things a company cannot do unless they are specifically authorised by its own constitution.

 

If a company wishes to adopt its own constitution, it can do so when it is registered. Alternatively, a company can adopt a constitution at a later date.  A company can adopt, change or revoke its constitution whenever it wishes, provided it follows the correct formal procedure. 

 

Step 3 – Receiving a Company’s Certificate of Incorporation

 

Once a properly completed application for registration has been lodged, the third step in the incorporation process is receipt of a certificate of incorporation from the Registrar of Companies. A certificate of incorporation is issued as soon as the Registrar receives a properly completed application for the registration of a company, with all the properly completed supporting documents, and the registration fee.  Once issued, a certificate of incorporation is evidence that all the registration requirements have been satisfied. 

 

Follow-up Steps

 

As practical matters, once a company has been incorporated, it can obtain an IRD number, and set up a bank account. 

 

Once the company has been incorporated, the company, and its directors, must comply at all times with the requirements of the Companies Act 1993, and other relevant legislation and regulations.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



We welcome your feedback

Hi there! We want to make this site as good as it can for you, the user. Please tell us what you would like to do differently and we will do our best to accommodate!


 
 
We've updated our Privacy Statement, before you continue. please read our new Privacy Statement and familiarise yourself with the terms.
Feedback