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Companies Act, 2008 (Act No. 71 of 2008)

Chapter 2 : Formation, Administration and Dissolution of Companies

Part E : Securities registration and transfer

49. Securities to be evidenced by certificates or uncertificated

 

 

1) In this Part, ‘‘certificated’’ means evidenced by a certificate, as contemplated in subsection (2)(a).

 

2) Any securities issued by a company must be either—
a) evidenced by certificates; or
b) uncertificated, in which case the company must not issue certificates evidencing or purporting to evidence title to those securities, subject to subsection (6).

 

3) Except to the extent that this Act expressly provides otherwise,—
a) the rights and obligations of security holders are not different solely on the basis of their respective securities being certificated or uncertificated; and
b) any provision of this Act applies with respect to any uncertificated securities in the same manner as it applies to certificated securities.

 

4) Sections 52 to 55—
a) apply only to uncertificated securities; and
b) prevail in the case of a conflict between any provision of those sections and any other provision of this Act, any other law, the common law, the company’s Memorandum of Incorporation or any agreement.

 

5) Any certificated securities may cease to be evidenced by certificates, and thereafter be uncertificated, in which case any provision of this Act contemplated in subsection (4) applies to those securities from the date on which they ceased to be evidenced by certificates.

 

6) In the manner set out in section 54, any uncertificated securities may be withdrawn from the uncertificated securities register, and certificates issued evidencing those securities, in which case from the date on which they became certificated—
a) sections 52 to 55 cease to apply to those securities; and
b) for greater certainty, transfer of ownership in those securities cannot be effected by a participant or central securities depository while they remain in certificated form, unless they are held in certified form in collective custody by the participant or central securities depository.

 

7) The Minister may make regulations regarding matters that are supplementary and ancillary to the provisions of this Part.