Ever wondered how you will be able to prove that you are the owner of your company or what would happen if someone else claims to be the owner of your company? Although it’ll most probably be implied that you’re the owner of your business through operation, being a director and shareholder of the company is not the same.
The only way to prove that you are the owner of the whole or certain percentage of the company, is through a duly signed Share Certificate awarded by the Company. Without having a signed original share certificate issued in your name, it’ll be difficult — or even sometimes impossible — to confirm that you are the lawful owner of your company. Having a share certificate also means that you’ll be able to transfer, cede, or sell your ownership in and to a business.
Having a share certificate in your name, however, doesn’t confirm that the rights in and to the shares displayed on the certificate has been confirmed by the company as a separate entity. In terms of section 37(9) of the Companies Act of 2008, only once the shareholder’s name is entered into the Share Register of the company, does he/she actually acquire the rights associated with the particular shares issued to him.
Having share certificates and a share register in place can save a lot of time having to prove that you’re the lawful owner of shares in and to a company — and may prevent various disputes relating to same.