Share certificates

Published by a ��˾��ҹ�� Corporate expert

Practice notes

Share certificates

Published by a ��˾��ҹ�� Corporate expert

Practice notes

shares in a company can be issued as certificated shares or uncertificated shares.

Shares issued by private companies and unlisted public companies are usually held in certificated form, while shares in listed companies and AIM companies are usually held in uncertificated form.

This Practice Note is concerned with the law and practice relevant to share certificates, which are only issued in relation to certificated shares.

Certificated shares

Shares in a company are held in certificated form if:

•
the company has issued a physical share certificate for the shares, and
•
the owner of the shares has their name entered in the company's register of members

A person is only a member of a company if they have agreed to become a member and have had their name entered in its register of members. Every company limited by shares is required by the Companies Act 2006 (CA 2006) to keep a register of members. The information that must be recorded in the register of members includes the name and address of each member, the date on which they became a

Jurisdiction(s):

United Kingdom

Key definition:

Shares definition

What does Shares mean?

The CA 2006 merely provides that a share is a share in the company's share capital. A company's share capital comprises the number of shares issued by it to investors either on or after incorporation. Those investors then become the shareholders in the company. A shareholder’s shares are their personal property. By contrast, the assets of a company are owned by the company itself. Owning shares does not entitle a shareholder to any property rights in the company's assets.

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