Everything You Need to Know About Share Certificate
When you buy shares of a company, it’s company secretary Singapore issues you with share certificates. It is proof of your ownership in the company. The private limited companies issue paper share certificates to their shareholders or members. However, the publicly listed companies issue electronic share certificates. These are lodged into your Central Depository accounts.
Details On Singapore Share Certificates
In Singapore share certificate issued by a company must carry:
- Its company seal
- Company name and name of governing authority, i.e. ACRA
- Company’s registered office address or branch office address
- Whether the shares are wholly or partly paid (should mention unpaid amount)
Since, 31 Mar 2017, it is not mandatory for a Singaporean company to use the company seal to execute its documents, like share certificates, as a deed. However, the document must carry the signature of its authorized representative.
Company Secretary Singapore Issues Share Certificates
A company secretary prepares and issues share certificates to the shareholders or members of the company. They maintain shareholders’ register and take care of its corporate governance and compliance.
The secretary updates the register after issuing or transferring the shares and details of the shareholders. Each share certificate carries the appropriate number, which is recorded in the shareholders’ register.
Before issuance, two company directors put their signatures on the Singapore share certificates. If the company is lead by only one director, then a company secretary and the director, need to put their signatures on the certificates.
The company secretary Singapore retains the certificate’s counterfoil portion or asks the shareholder for a note to acknowledge the receipt of certificates.
When a Company Issues Share Certificate to Its Shareholders
A shareholder gets issued with share certificates at the time of Singapore company incorporation, allotment or transfer of shares.
Allotment of Shares
When a company wants to increase its share capital, it may do it by selling new shares to existing or new shareholders. It is called the allotment of shares. It is done keeping with the provisions of Section 161 of the Company Act of Singapore.
The board proposes issuance of shares. If the company shareholders agree with it, the new shares are issued. They are lodged with the ACRA. They are then issued to the shareholders with the prescribed time limit.
- Prepares Director’s Resolution recording the share allotment
- Lodges share an allotment with ACRA
- Prepares new Share Certificate(s)
Transfer of Shares
Under the transfer of shares, a shareholder transfers his title of the shares or sells his shares to another investor. It could be an individual investor or company. The transfer may involve a part of the full transfer of shares. Regardless of the mode of transfer, the Secretary cancels the original share certificate.
If it is a partial transfer, the company secretary Singapore issues new Singapore share certificates to transferor and transferee to show their ownership in the company. A fully transferred share transaction is easy to handle. The secretary cancels the original share certificate and issues new one to the new shareholder.
The secretary then lodges the transaction with ACRA and issues the share certificate to the new shareholder within the prescribed time limit.
- Prepares Director’s Resolution recording the transfer of shares
- Lodges share an allotment with ACRA
- Prepares instrument of Transfer
- Stamp duty acknowledgement from the IRAS
- Cancels the original Share Certificate
- Prepares of new Share Certificate(s)
Prescribed Time Limit for Issuance of Share Certificate
A Singapore company has to issue the Share Certificates within 30-60 days.
- Allotment of shares: Within 60 days
- Transfer of shares: Within 30 days after lodging the share transfer with ACRA
Lost or Destroyed Share Certificate
In the case of lost or destroyed Singapore share certificates, the shareholder has to submit a statutory declaration stating so to the company. If it is the case of a lost certificate, the shareholder has to provide a written understanding that if the certificate is found later, it will be delivered to the company.
If the value of certificate exceeds $500; the director may ask the shareholder to publish a notice in the newspaper stating loss or destruction of certificates and intention of applying for duplicates after 14 days from the publication date of the notice.
The shareholder may also need to provide a bond amounting to the current market value of shares indemnifying the company against loss in the case if original certificates are produced. The company secretary Singapore issues the duplicate certificates to the shareholder.
SBS Consulting is a provider of corporate services, including company incorporation and company secretary Singapore. If you have any questions, call us on +65 6536 0036 or email us at firstname.lastname@example.org for answers.