What is a Company Limited by Guarantee (CLG)?

A company limited by guarantee is formed by at least one person at the time of incorporation.  It is a public company that is generally set up for non-profit purposes and does not have a share capital. In the absence of the share capital, a guarantee is provided by the member(s) of the company, which is set out in its Constitution (formerly known as Memorandum & Articles of Association). The guarantee states that the member(s) undertakes to contribute to assets of the company for the payment of debts and liabilities if the company is wound up. The Companies Act also prescribes other requirements for incorporation as a company limited by guarantee and can be found on ACRA’s website.

The liability of the members is limited to the amount of guarantee provided to the company.