A Share Certificate is a physical, written document signed by the Directors of a Company, and serves as legal proof of each Director’s shareholding / ownership in the Company. These Certificates need to be prepared according to the Companies Act of 2008 through a Company Secretary. If the process is not followed accurately, the Certificates will be declared invalid in court by South African Companies law.
Please note: This cost includes Share Certificates for up to 4 Shareholders. For R200 extra you can include an ‘Electronic Share Register’ to formally track share transactions.
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1. Banks. Most banks requires new companies to have valid Share Certificate when opening a bank account.
2. Change of Shareholding. If Shareholders are added or removed, the original Share Certificates will be required. To track shareholding changes in your company you need a Share Register as well. This is a formal electronic ‘logbook’ which indicates exactly when shares has moved hand between which shareholders.
3. In Court. This document is proof of your ownership in a Company – if there is ever a dispute which are taken to court, this document will be the difference between a Shareholder’s success or failure to prove ownership in a Company.
In summary, a Share Certificate is proof of how much ownership a person has in a specific Company.
A share certificate, which is produced and issued by a company, certifies on a certain date that a person is the registered owner of shares in that company. The key information shown on the certificate includes the name and address of the shareholder, the class of shares and number of shares held.
A share certificate is a written document signed on behalf of a corporation that serves as legal proof of ownership of the number of shares indicated. A share certificate is also referred to as a stock certificate.
Who issue a share certificate? CIPC do not keep record of the shareholders neither the issued shares. Therefore share certificates must be drawn up by the company self although such is not mandatory in terms of the Companies Act, 2008.
Every company needs to initially make an amount of shares available to the current and future shareholders. This is done at no cost during the company registration process and is shown on the MOI Certificate of a company. Normally the total Share Allocation amounts to 1000.
NOTE: Existing Companies may need other services before they can issue Share Certificates to new shareholders. Read about Share Transfers, Share Registers and much more.