Companies Act 2014 section 972

Capacity of a DAC

Section 972 establishes that a Designated Activity Company (DAC) may only carry out activities that fall within the objects set out in its memorandum, and clarifies how those objects are to be interpreted.

• A DAC has the capacity to do any act or thing stated in the objects set out in its memorandum.
• The term "object" includes anything described in the memorandum as a power to act, regardless of the specific wording used.
• Where an object is stated but the memorandum does not detail how it may be achieved, the DAC may do anything that appears necessary, advantageous, or incidental to achieving that object, provided it does not conflict with any legislation.
• Unlike a private company limited by shares (LTD), which has unlimited capacity under the Act, a DAC's capacity is restricted to what its memorandum permits.