What Are Articles of Incorporation and Why Do You Need Them?

Close up of a submission form for articles of incorporation Mission Box

When setting up your company, you will have to identify which legal structure you are going to adopt. While many small enterprises opt for a sole proprietorship or a partnership, incorporating your business is arguably the best option in terms of legal and financial protection of your personal assets.

The process of incorporation isn't straightforward, however, and you will need to provide a number of supporting documents to your relevant regulatory body. One such item is what is known as the articles of incorporation, and they are an essential part of the procedure.

To help illustrate what exactly they are, and how to submit them, we've compiled a handy guide on what exactly you need to do.

What Are Articles of Incorporation?

Your articles of incorporation are intended to provide necessary information about your company. This information is essential in order to register it as a separate entity and will include details such as the name of the organisation and the people who will be running it.

Note that in some jurisdictions, the articles of incorporation and the certificate of incorporation are generally defined as the same thing. In many areas, though – particularly parts of the US – this is not the case, and they are two separate documents. For clarity, you should check with your local regulatory governing body.

Why Do You Need Articles of Incorporation?

By filing articles of incorporation, you are essentially legitimising your organisation.

For example, in practical terms, it facilitates the ease of doing business by enabling you to set up a separate business bank account, while it also makes you eligible to apply for a business loan, if required. When potential investors or other interested parties want to look into your business, the information you have provided in the articles of incorporation is what they will see. In many ways, it is a public record of the existence of your organisation.

In the wider context, though, it creates a separate legal entity for your company, effectively separating your personal assets and finances from those of the enterprise and protecting you financially if the business encounters problems. This is the critical advantage of incorporation, and the articles of incorporation is the document that will prove you possess that status.

How Do I Obtain Articles of Incorporation?

As part of the incorporation process, you will be asked to file a specific set of documents with your relevant government agency (such as the Companies Registry in the US or Companies House in the UK). While the exact rules and regulations applicable will depend on the location of your company, this process is generally the same across the world.

Therefore, to obtain your articles of incorporation, you will be asked to submit information about your company, either through an online form or by post (again, this will vary by jurisdiction).

What Information Do I Need to Include?

In most cases, you will need to outline the primary objective of your company, where it is based, and the number of shares you plan to issue. You will also need to identify the type of stock being issued (if any). Here is a breakdown of the key details you will need to include:

  • Company Name: The name of the company in full. The name you choose will have to meet specific criteria, and must not be already taken. In certain industries, it may also be mandatory to include a supporting abbreviation, such as "Inc".

  • Type of Corporation: Types of corporations can include non-profit corporations, stock corporations, and non-stock corporations. In the case of stock corporations, you will also need to provide additional information, such as the cost and amount of shares.

  • Objectives of the Corporation: The goal of the business, such as the product you are selling or the services you are offering (the depth of information sought here can vary depending on your location). Note that this is different from your mission or vision statement; it should identify the actual intent of your organisation, rather than your "take" on it.

  • List of Directors: When incorporating a business, you are required to constitute a board of directors. The names of these directors must then be included among the articles of incorporation. In some jurisdictions, you may also be required to provide the names of corporate officers, too, such as presidents or treasurers.

  • Incorporator Details: The person entrusted with the responsibility of setting up the corporation is known as the incorporator (this might not always be you, especially if you have hired a third-party agency to complete the process on your behalf). It is this person who will file the articles of incorporation. This individual might also be given the duties of choosing members of the board or convening the first board meeting.

  • Duration of the Corporation: While most corporations are intended to exist perpetually, some are deliberately set up for a fixed period of time. You should identify which.

  • Contact Information of the Registered Agent: While it is not mandatory, it is certainly convenient to have a registered agent for your company who will receive any essential legal documents on your behalf. This can help avoid cases of important papers ending up in the wrong hands, or someone misplacing them. Indeed, hiring a registered agent service is a popular option as they are always available during regular business hours. Note that registered agents must have a proper physical address (PO Box addresses are unlikely to be accepted), while you can also have your attorney serve as a registered agent.

Filing Articles of Incorporation

Once you have submitted this information, you will likely incur a nominal administrative fee. You might also want an independent (or in-house, if applicable) attorney to look over your paperwork, although there is no legal stipulation to do so. It is, however, recommended, as it will save any delays owing to mistakes in the filing process or the wrong documents being supplied.

The timespan for being approved depends heavily on your jurisdiction (and, of course, if there are any issues with the information you have submitted), but, generally, you should be looking at between two to four weeks before you receive your articles of incorporation. 

Once the process is completed, you will then receive the necessary formal documentation, as well as a certificate of incorporation. All of the information included will also become public record.

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This is the part of the incorporation process that is the most significant, and that takes the longest, so be patient and ensure that everything is correct before you send it off. The process is relatively straightforward, but delays can arise from oversights and mistakes, so take the time to do everything properly.

Do you have any other tips for obtaining articles of incorporation? If so, let us know in the comment section below!