Share Certificates Explained for CIPC registered companies

If you would like any assistance with printing your own share certificates, please use the following link:

https://www.swiftreg.co.za/Swiftreg/p...

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And now for the video script... :)

If you never printed (or the correct word is issued) share certificates when your company was registered, then this video is for you. An original, physical share certificate is proof of ownership of a company so is therefore a very important document. It must be signed by all of the directors in order to validate it.

So if you do have an original share certificate you should take good care of it and keep it in a safe place as it is the proof of your ownership of the company which will allow you to share in the profits of the company and vote to appoint the directors who manage the company.

The first thing you ought to know is how many shares were “created” or issued when the company was initially registered. The correct term for this is the authorised share capital. The share capital is stated on page 1 your company’s Memorandum of Incorporation or MOI which is also referred to the COR 15.1 A. The 2nd line from the top will state the number of shares issued.

Most private companies are registered with the standard MOI as draft by CIPC which has ordinary shares only. There are no other share classes, such as preferential shares, in a standard MOI which makes the shares issuing simple.

You may also have heard about non par value shares, which means that the price of the shares is not fixed but vary according to the value of the company. The value of the company is determined by what a willing buyer and what the willing seller agree upon. It is important to understand that the amount of authorised share capital has nothing to do with the value of the company

There are also par value shares which is only relevant for companies registered before 1 May 2011 and not covered in this video.

There is an option to not issue all the authorised shares to the shareholders which means that some of the shares are retained by the company with the idea that they can be transferred at a later date. This however complicates matters – I have made another video on this as it is quite complex. So we recommend that all the share are issued up front to simplify future transfers rather than leaving unallocated shares in the company. You do also have the option to increase the authorised share capital at any time should the need arise.

So how does the process work?
Log on to our website, select print share certificate and populate the required data which is the company and shareholder information. Once we have received proof of payment and it reflects on our system a button marked Print Shares will appear under the “my purchases” section. Print the certificate and get the directors to sign it and you now have the original certificate which I would suggest that you keep in a safe place.

This process is designed to be quick and easy to use but does not produce a company register. If you require that service option you can try ShareVault which is our advance online share transfer service which produces the necessary minutes, updates the company register including online storage ensuring your company is compliant with the companies Act. It does however require the full shareholding history from inception to be captured so is ideal for Accountants.

I hope this has been helpful, so as always remember WE ARE HERE TO HELP

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