A constitution sets out the rules by which a company is governed and may be adopted before or after registration of the company. If a company chooses not to adopt a constitution the default set of rules in the Corporations Act 2001 known as the replaceable rules will apply.
Generally, a company will be free to operate under the replaceable rules; however these rules are not applicable to a proprietary company where the same individual is both the sole director as well as the sole shareholder.
Similarly, if the company is to qualify as a special purpose (Home unit, Not-for-profit or Superannuation trustee) company in order to attract a reduced annual fee, it will need to be governed by a constitution which contains clauses specific to each type of company. A Not-for-profit company may also require specific clauses in order to qualify for tax concessions with the ATO.
Patricia Holdings has constitutions that are suitable for each of the above purposes.
