Who are promoters and what are their duties to the company?

• According to one judge a promoter is one who undertakes to form a company with reference to a given project and set it going and who takes the necessary steps to accomplish that purpose.
• This definition does not postulate the role a person must play to be regarded as a promoter.
• Is not a promoter the person who prepares the necessary documentation registers the company, secures the services of directors and provides all the instrumentalities to enable the company pursue its objects?

• A promoter is any person who has taken some part in bringing a company into existence or in procuring persons to join it as soon as it is technically formed.
• The question who a promoter is one of fact. It all depends on the role the person played may be active or passive.
• Act bona fide for the benefit of the company in formation.
• Render a proper account of his activities.
• Disclose any person interest in contracts made on behalf of the company.
• Determine and settle the company‟s name.
• Prepare or cause preparation of the requisite documentation.
• Register or cause registration of the company.
• Secure the services of directors
• Meet all the preliminary expenses.
• Ensure that the company in formation has an independent board of directors.
• Prepare the requisite prospectus, if any
• Acquire assets for use the company
• Enter into contracts on behalf of the company.

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