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Articles of association are critical documents to corporate operations, as they may regulate both internal and external affairs. [1] Articles of incorporation, also referred to as the certificate of incorporation or the corporate charter, is a document or charter that establishes the existence of a corporation in the United States and Canada.
There are a number of legal benefits that come with incorporation. One significant legal benefit is the protection of personal assets against the claims of creditors and lawsuits. Sole proprietors and general partners in a partnership are personally and jointly responsible for all the legal liability (LL) of a business such as loans, accounts payable, and legal
One of the most important things that the articles of incorporation determine is the state of incorporation. Different states can have different levels of corporate tax or franchise tax , different qualities of shareholder and stakeholder rights, more or less stringent directors' duties , and so on.
By convention, most common law jurisdictions divide the constitutional documents of companies into two separate documents: [1]. the Memorandum of Association (in some countries referred to as the Articles of Incorporation) is the primary document, and will generally regulate the company's activities with the outside world, such as the company's objects and powers.
The articles of association (often referred to as just ‘articles’) is the document which sets out the rules for the running of the company's internal affairs. The company's articles are delivered to the Registrar at incorporation. In the event that no articles are registered for the new company, the model (default) articles will be registered.
Most state corporate laws require that the basic governing instrument be either the certificate of incorporation or formal articles of incorporation. Many corporations also adopt additional governing rules known as bylaws. Most state laws require at least one director and at least two officers, all of whom may be the same person.