Share register and Company registers are essential for proper corporate governance. Share register displays the list for shareholders at any given point in time. Company register also displays information about the officers of the company i.e. directors (formal and current), secretary, auditor including address and particulars of all these officers of the company.
What is a Share Certificate
A Share certificate serves as official documents issued by a company to its shareholders, confirming their ownership of specific numbers of shares in the company. In Ghana, the Companies Act 2019 (Act 992) provides guidelines regarding the issuance and transfer of shares in a company.
The issuance of share certificates is a crucial step in the process of transferring ownership of shares. The Companies Act 2019, Section 55(1) states: “Where a company issues shares, the company shall, within two months after the issue of the shares, deliver to the shareholder a share certificate in respect of the shares.”
Upon receiving share certificates, shareholders have tangible evidence of their ownership interest in the company. These certificates typically include details such as the shareholder’s name, the number of shares owned, the class of shares, and the date of issue.
When it comes to transferring shares in a company in Ghana, several steps need to be followed, involving both the Lands Commission and the Registrar General’s Department.
Procedure for transferring shares to a new shareholder in an existing entity
Agreement:
The transferor (seller) and transferee (buyer) must reach an agreement on the sale and purchase of shares. This agreement may be in the form of a share transfer deed or a share purchase agreement.
Share Transfer Form:
The transferee must complete a share transfer form. In Ghana, this form is typically known as the “Special Resolution Form” and “Share instrument” as prescribed by the Registrar General’s Department.
Execution of Share Transfer Form:
The share transfer form must be signed by both the transferor and the transferee.
Stamping of Share Transfer instrument at Lands Commission:
A share instrument indicating the shares and particulars of the transferor and the transferee needs to be prepared and submitted at the Lands Commission for review and stamp. The share instrument must be witnessed by two people. After the share instrument is stamped, it will be further submitted at the Registrar General’s Department for the transfer to be effected in the company registration documents.
Submission to Registrar General’s Department:
Once the share instrument is completed and stamped, it needs to be submitted to the Registrar General’s Department for amendment.
Update Share Register:
After registration of the share transfer at the Registrar General’s Department, the company must update its share register and company registration documents to reflect the new ownership of shares.
Notification to Company:
The company should be notified of the share transfer, and the new shareholder should be issued updated share certificates reflecting their ownership.
In summary, the process of transferring shares in a company in Ghana involves completing the share transfer instrument, special resolution, a written resolution by the existing shareholders, obtaining the necessary signaturess, submitting the form to the Registrar General’s Department for registration, and updating the company’s share register and issuing updated share certificates. This process ensures transparency, legal compliance, and the accurate recording of share ownership changes, as required by the Companies Act 2019.
ALSO LEARN ABOUT HOW TO REGISTER A COMPANY IN GHANA
What are company registers
The register of directors, secretary, shareholders, and auditor holds significant importance within a company’s governance framework, serving as a comprehensive repository of key stakeholders and personnel involved in its management and oversight.
Register of Directors
- “Every company shall keep at its registered office a register of directors and shall enter therein the particulars of all directors of the company.”
- The register of directors provides a transparent record of individuals serving on the company’s board, including their names, addresses, dates of appointment, and any other relevant details. This register is crucial for ensuring compliance with legal requirements, facilitating communication between the company and its directors, and providing transparency regarding the composition of the board.
Register of Secretary
- Every company shall keep at its registered office a register of secretaries and shall enter therein the particulars of all secretaries of the company.
- The register of secretary records information about the company’s appointed secretary or secretaries, including their names, addresses, dates of appointment, and any relevant qualifications. This register helps ensure that the company maintains accurate records of its administrative personnel and complies with legal requirements regarding the appointment and resignation of secretaries.
Register of Shareholders
- Every company shall keep at its registered office a register of members and shall enter therein the particulars of all members of the company.
- The register of shareholders is a fundamental document that contains details of all individuals or entities holding shares in the company. It includes information such as the shareholder’s name, address, class of shares held, and the number of shares owned. This register is essential for maintaining transparency in share ownership, facilitating communication between the company and its shareholders, and ensuring compliance with legal requirements regarding shareholding.
Register of Auditors
- Every company shall keep at its registered office a register of auditors and shall enter therein the particulars of all auditors of the company.
- The register of auditors maintains records of the auditors appointed by the company, including their names, addresses, dates of appointment, and any relevant qualifications. This register helps ensure transparency and accountability in the company’s financial reporting process, as it provides a clear record of the individuals or firms responsible for conducting audits.
The importance of maintaining these registers as mandated by the Companies Act 2019 cannot be overstated. These registers serve as vital tools for ensuring transparency, compliance with legal requirements, and effective corporate governance within companies operating in Ghana.
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Conclusion
In conclusion, understanding share certificates and the importance of maintaining accurate registers within a company are critical aspects of corporate governance in Ghana. Share certificates serve as tangible proof of ownership for shareholders, ensuring transparency and accountability in share transactions as outlined by the Companies Act 2019.
Moreover, the meticulous upkeep of registers, including those of directors, secretaries, shareholders, and auditors, is paramount. These registers serve as comprehensive repositories of key stakeholders within a company, facilitating compliance with legal requirements, effective communication, and transparent management.
By adhering to the prescribed procedures for share transfers and diligently maintaining registers, companies in Ghana can uphold the principles of transparency, accountability, and good corporate governance, thereby fostering trust and confidence among shareholders, regulators, and the public alike.
