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CSEET · Business Laws and Management · Elements of Company Law

Which of the following is correct about the content required when an advertisement of a prospectus is published, under the Companies Act, 2013?

An advertisement of a prospectus must specify the memorandum contents on objects, liability of members and amount of share capital, the names of signatories and the shares each subscribed, and the company's capital structure. Price, closing date or directors' names alone are not sufficient.

  1. AOnly the price and the closing date of the offer need to be stated
  2. BIt must specify the memorandum contents on objects, liability of members and share capital, the names of signatories with shares subscribed, and the capital structureCorrect
  3. COnly the names of the directors need to be stated
  4. DNo particulars are needed if the prospectus is filed with the Registrar

Explanation

Section 30 requires an advertisement of a prospectus to specify the memorandum's objects, liability of members and amount of share capital, the signatories' names and shares they subscribed, and the capital structure. Other options omit these requirements.

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