Model Articles of Association are standard rules that UK companies can use to govern their internal management. They cover matters such as directors’ decisions, shareholder voting, shares, dividends and general meetings.

The model articles are prescribed by law and provide a default constitution for many newly formed companies. A company may adopt them in full, modify them or use completely bespoke articles.

Why Does a Company Need Articles?

Every UK registered company must have Articles of Association.

They act as the company’s internal rulebook and explain how directors and shareholders make decisions.

The articles may regulate:

  • Directors’ powers
  • Board meetings
  • Director appointments
  • Conflicts of interest
  • Share issues
  • Share transfers
  • Shareholder voting
  • General meetings
  • Written resolutions
  • Dividends
  • Share certificates
  • Company communications

The model articles provide a ready-made version of these rules.

Who Created the Model Articles?

The model articles are set out in the Companies (Model Articles) Regulations 2008.

Separate versions are available for:

  • Private companies limited by shares
  • Private companies limited by guarantee
  • Public companies

The appropriate version depends on the company’s legal structure.

Which Model Articles Apply to a Private Limited Company?

Most small commercial companies are private companies limited by shares.

The model articles for this type of company contain rules covering:

  • Directors’ authority
  • Directors’ decision-making
  • Board-meeting procedures
  • Director appointments and termination
  • Shares and distributions
  • Shareholder decisions
  • General meetings
  • Voting
  • Administrative arrangements

A company limited by guarantee or a public company should use the model articles designed for its own legal form.

Are Model Articles Automatically Applied?

When an eligible company is incorporated without registering bespoke articles, the relevant model articles normally apply by default to the extent that they have not been excluded or modified.

A company can therefore have model articles even if its founders did not upload a separate constitutional document during registration.

The incorporation record should indicate whether the company adopted:

  • Model articles in full
  • Model articles with amendments
  • Bespoke articles

Do Model Articles Apply to Older Companies?

Not necessarily.

The current model articles generally apply to companies incorporated under the Companies Act 2006 system.

Older companies may instead have:

  • Table A articles
  • Bespoke articles under previous legislation
  • Older standard articles
  • Memorandum provisions treated as part of their articles
  • Articles amended by later shareholder resolutions

An older company should check its Companies House records and internal documents to determine which rules currently apply.

The latest model articles do not automatically replace an older company’s existing constitution.

What Do the Model Articles Say About Directors?

For a private company limited by shares, the model articles generally give directors responsibility for managing the company.

They cover matters such as:

  • Directors’ general authority
  • Delegation of directors’ powers
  • Collective decision-making
  • Unanimous director decisions
  • Calling board meetings
  • Participation in meetings
  • Board quorum
  • Voting at board meetings
  • Casting votes
  • Conflicts of interest
  • Appointment of directors
  • Termination of appointments
  • Director remuneration and expenses

Directors must follow both the articles and their statutory duties under the Companies Act 2006.

What Do They Say About Shares?

The model articles include provisions relating to:

  • Issuing shares
  • Different share classes
  • Share certificates
  • Replacement certificates
  • Partly paid shares
  • Share transfers
  • Transmission of shares after death
  • Dividends and other distributions
  • Capitalisation of profits

A company with a simple class of ordinary shares may find these provisions sufficient.

Companies with preference, non-voting, growth or alphabet shares may need additional or bespoke provisions.

What Do They Say About Shareholder Decisions?

The model articles regulate procedures for shareholder participation, including:

  • General meetings
  • Attendance and speaking
  • Quorum
  • Chairing meetings
  • Voting
  • Poll votes
  • Proxies
  • Joint shareholders
  • Written communications

The Companies Act 2006 also sets mandatory rules for resolutions and shareholder rights.

Are Model Articles Legally Binding?

Yes. Once they apply to a company, the model articles form part of its constitution.

They bind the company and its members in their capacity as members.

Directors must also act within the company’s constitution. Failing to follow the articles can result in invalid or challengeable decisions, shareholder disputes and possible breaches of directors’ duties.

Are Model Articles Free?

Yes. The standard model articles are publicly available and do not require a licensing fee.

A company may still incur professional fees if it asks a solicitor or formation specialist to:

  • Review the model articles
  • Modify particular provisions
  • Prepare bespoke articles
  • Align them with a shareholders’ agreement
  • Create special share rights

Are Model Articles Suitable for a Sole-Owner Company?

They may be suitable for a straightforward company with one shareholder, one ordinary share class and no outside investors.

However, a sole-director company should check that its articles clearly support its intended decision-making arrangements.

Questions can arise where articles refer to director quorum requirements that appear to assume the presence of more than one director.

A company with a sole director may wish to adopt amended articles that expressly confirm how one-director decisions are made.

Are Model Articles Suitable for a 50/50 Company?

They may provide a basic governance structure, but they do not necessarily solve a deadlock between two equal shareholders.

If both shareholders own 50% of the voting rights and disagree, neither may be able to obtain the required majority.

A 50/50 company should consider tailored provisions covering:

  • Deadlock resolution
  • Director appointments
  • Reserved matters
  • Share transfers
  • Buyout procedures
  • Share valuation
  • Company-sale arrangements
  • Departing shareholders

These provisions may appear in bespoke articles and a shareholders’ agreement.

Are Model Articles Suitable for Multiple Share Classes?

They may not be sufficient on their own.

A company issuing different classes should clearly define each class’s:

  • Voting rights
  • Dividend rights
  • Capital rights
  • Redemption rights
  • Conversion rights
  • Transfer restrictions
  • Rights during a company sale

The standard model articles do not automatically create detailed rights for preference, alphabet, growth or non-voting shares.

Are Model Articles Suitable for Investors?

External investors often require rights that are not included in the standard articles.

These may include:

  • Preference dividends
  • Capital preferences
  • Anti-dilution rights
  • Investor consent rights
  • Director-appointment rights
  • Information rights
  • Conversion rights
  • Drag-along and tag-along rights
  • Protection against new share issues
  • Rights during a company sale

An investment transaction will often involve amended or replacement articles together with a shareholders’ or investment agreement.

Can a Company Amend the Model Articles?

Yes. A company can adopt the model articles with amendments or change them after incorporation.

Amendments may:

  • Change the director quorum
  • Add share-transfer restrictions
  • Create different share classes
  • Introduce investor protections
  • Add director-appointment rights
  • Establish compulsory transfers
  • Include succession provisions
  • Add enhanced voting requirements
  • Create drag-along or tag-along rights

The amended provisions must comply with company law.

How Does a Company Change Its Model Articles?

The shareholders will normally need to pass a special resolution.

A special resolution generally requires at least 75% of the votes cast by eligible shareholders.

The company should then send Companies House:

  • A copy of the special resolution
  • A complete copy of the amended or replacement articles
  • Any additional form required for the particular change

The special resolution must generally be filed within 15 days after it is passed. The amended articles must generally be filed within 15 days after they take effect.

Can a Company Replace the Model Articles Completely?

Yes. A company may replace the model articles with an entirely bespoke set.

This may be appropriate when:

  • Several investors join
  • New share classes are created
  • The company establishes an employee share scheme
  • Ownership becomes more complex
  • Detailed transfer rules are needed
  • The company prepares for a sale
  • Existing amendments have become difficult to follow
  • A shareholders’ agreement is introduced

The new articles should be adopted by the proper shareholder resolution and filed with Companies House.

What Are Bespoke Articles?

Bespoke articles are constitutional rules drafted specifically for a particular company.

They can reflect:

  • The company’s ownership percentages
  • Founder arrangements
  • Investor protections
  • Different share classes
  • Voting control
  • Dividend rights
  • Transfer restrictions
  • Employee-share arrangements
  • Succession planning
  • Deadlock procedures
  • Sale rights

They offer greater flexibility but are more expensive and complex than using unmodified model articles.

What Is the Difference Between Model Articles and a Shareholders’ Agreement?

Model articles form part of the company’s constitution and are generally publicly available through Companies House.

A shareholders’ agreement is a private contract between some or all shareholders and, sometimes, the company.

A shareholders’ agreement may cover:

  • Funding obligations
  • Founder responsibilities
  • Reserved decisions
  • Dividend policy
  • Share transfers
  • Deadlocks
  • Confidentiality
  • Shareholder departures
  • Business-sale arrangements

The documents should be drafted consistently. A private shareholders’ agreement does not automatically override the articles or the Companies Act 2006.

Are Model Articles Filed With Companies House?

Where a company adopts the applicable model articles in full, Companies House records that fact during incorporation.

The company does not normally need to upload a separate copy of the standard text.

If the company adopts amended or bespoke articles, the relevant document must be filed.

Any later replacement or amendment must also be reported to Companies House.

Where Can a Company Find Its Articles?

A company can check:

  • Its incorporation documents
  • Its statutory records
  • The Companies House register
  • Records held by its formation agent
  • Documents held by its solicitor or accountant

The company should identify the latest complete version and review any later resolutions that changed its constitution.

Advantages of Model Articles

Potential advantages include:

  • Free to use
  • Simple and widely recognised
  • Suitable for many straightforward companies
  • Automatically available during incorporation
  • Covers common governance issues
  • Easier to understand than complex bespoke provisions
  • Can be amended later

Potential Disadvantages

Possible disadvantages include:

  • Limited protection for minority shareholders
  • No detailed deadlock procedure
  • Limited provisions for complex share classes
  • No tailored founder arrangements
  • Limited investor protections
  • No detailed employee leaver rules
  • Potential uncertainty for some sole-director companies
  • May not align with a shareholders’ agreement
  • May not suit family succession planning

When Should a Company Review Its Model Articles?

Review them when:

  • A new shareholder joins
  • An investor provides funding
  • A new share class is created
  • Shares are issued to employees
  • Voting or dividend rights change
  • A shareholders’ agreement is signed
  • A director leaves or joins
  • The company becomes a 50/50 business
  • A shareholder dies
  • The company prepares for sale
  • A governance dispute arises
  • The law changes

Common Mistakes to Avoid

Companies should avoid:

  • Assuming model articles suit every business
  • Using the wrong version for the company type
  • Believing all share classes are automatically covered
  • Ignoring sole-director quorum issues
  • Allowing the articles and shareholders’ agreement to conflict
  • Creating special share rights without constitutional support
  • Failing to follow director decision-making rules
  • Amending articles without a special resolution
  • Missing Companies House filing deadlines
  • Relying on an outdated copy

Frequently Asked Questions

Does Every UK Company Use Model Articles?

No. A company may use model articles, amended model articles or bespoke articles.

Are Model Articles Mandatory?

Articles are mandatory, but using the unmodified model version is not.

Can a New Company Use Model Articles Automatically?

Yes. The relevant model articles normally apply by default when an eligible company does not register bespoke articles.

Can Model Articles Be Changed Later?

Yes. Shareholders can normally amend or replace them by special resolution.

Are Model Articles Suitable for One Shareholder?

They may be suitable for a simple one-owner company, but the director and decision-making provisions should still be reviewed.

Do Model Articles Expire?

No. They continue to apply until validly amended, replaced or affected by a change in law.

Final Summary

Model Articles of Association are standard constitutional rules available for UK companies. They regulate directors, shareholders, shares, voting, meetings and distributions.

They are often suitable for straightforward private companies with one class of ordinary shares. Companies with investors, multiple founders, special share classes or complex transfer arrangements may need amended or bespoke articles.

The company should review its articles whenever its ownership, management or share structure changes.

This article provides general information and does not constitute legal or financial advice.

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