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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

53. Transfer of uncertificated securities

 

 

1) The transfer of uncertificated securities in an uncertificated securities register may be effected only—
a) by a participant or central securities depository;
b) on receipt of—
i) an instruction to transfer sent and properly authenticated in terms of the rules of a central securities depository; or
ii) an order of a court; and
c) in accordance with this section and the rules of the central securities depository.

 

2) Transfer of ownership in any uncertificated securities must be effected by—
a) debiting the account in the uncertificated securities register from which the transfer is effected; and
b) crediting the account in the uncertificated securities register to which the transfer is effected, in accordance with the rules of a central securities depository.

 

3) The requirements of section 51(5), read with the changes required by the context, apply with respect to a transfer of uncertificated securities.

 

4) A transfer of ownership in accordance with this section occurs despite any fraud, illegality or insolvency that may—
a) affect the relevant uncertificated securities; or
b) have resulted in the transfer being effected,

but a transferee who was a party to or had knowledge of the fraud or illegality, or had knowledge of the insolvency, as the case may be, may not rely on this subsection.

 

5) A court may not order the name of a transferee contemplated in this section to be removed from an uncertificated securities register, unless that person was a party to or had knowledge of a fraud or illegality as contemplated in subsection (4).

 

6) Nothing in this section prejudices any power of a participant or central securities depository, as the case may be, to effect a transfer to a person to whom the right to any uncertificated securities of a company has been transmitted by operation of law.