Share certificate: evidence of title, not the title itself

A share certificate is the document a company issues to a shareholder stating how many shares of what class they hold. It is evidence of ownership — prima facie evidence, in the usual formulation — but it is not ownership itself. Title comes from entry in the register of members, and where certificate and register disagree, the register is what counts.

This is why lost certificates are an inconvenience rather than a catastrophe, and why a beautifully printed certificate for shares that were never entered in the register proves very little.

What a share certificate must show

• The company name and registration number.
• The certificate number, and the date of issue.
• The shareholder’s name and address as entered in the register.
• The number of shares, the class, and whether they are fully paid.
• The nominal value per share.
• Execution by the company — signatures of directors, or a director and the secretary, or the company seal where one is used.

Most jurisdictions set a deadline for issuing certificates after an allotment or a transfer — commonly two months. It is one of those obligations that is quietly missed for years and then discovered by a buyer’s solicitor at the worst possible time.

Issue, transfer and replacement

1. On allotment: enter the shareholder in the register, then issue the certificate.
2. On transfer: receive the stock transfer form, pay any stamp duty due, update the register, cancel the old certificate and issue a new one to the buyer — and a balance certificate to the seller if they kept some shares.
3. On loss: take an indemnity from the holder, and issue a replacement marked as such, with the certificate number recorded against the original.
4. On a share split or consolidation: reissue certificates reflecting the new holdings rather than annotating the old ones.

The certificate cannot be more current than the register. Companies that issue certificates from a template but update the register once a year end up with documents in circulation that contradict their own books — and it is the shareholder holding the outdated certificate who discovers it, usually while trying to sell. Keeping the register current in the statutory books is what makes the certificate reliable.

Paper, electronic, or neither

Many private companies still issue paper certificates because the articles require it. Some articles allow them to be dispensed with, and some jurisdictions have moved to fully uncertificated holdings for private companies too. Before designing a process, read the articles: they decide whether certificates are required at all, who signs, and whether a seal is needed.

Where certificates are issued, they are documents that must be produced accurately, executed properly and archived in a form that stays readable for decades. Ettex PDF fills the certificate from the register data, applies the signatures, and keeps the flattened issued version with its number and date — so what the shareholder holds and what the company filed are the same document. Maintaining the register itself remains a company secretarial job that the certificate follows, never leads.