Do shareholders have the right to receive a share certificate?

CASE STUDY QUESTION >>>

“I am the director of a company. We have issued 5% of the shares to a key sales employee. He has asked for a share certificate. None of the other shareholders have been given share certificates in the past. Do we need to create a share certificate for him?”

ANSWER >>>

There is no legal right for shareholders to receive a paper share certificate. However, most companies will issue share certificates to their shareholders. You may also find that your articles of association specify that your shareholders must be issued with share certificates.

All of your shareholders do have the right to have their names listed in the company’s Register of Members, and they are able to inspect this register to check.