According to Section 97 in the Companies Act 2016, the company does not need to issue a share certificate anymore except if it receives a shareholder’s application for a certificate about his shares in the company or if this is written in the company’s constitution. The issuance of share certificate should comply with Subdivision 2 of the Act. It is more advisable for business owners (Also see Accounting Tips That All Business Owners Should Know) to engage a corporate secretarial firm in Johor Bahru if they are not sure how they should handle this.
If the company receives an application from the shareholder, it should send a share certificate to him within 60 days. The certificate should state the company’s name, the class of shares the shareholder is holding, as well as the number of shares he holds. After the company issues a share certificate, the company should not register the transfer of shares except if the individual has submitted the form of transfer with the share certificate about the shares that are involved in the transfer. If the shareholder is unable to do so, he should provide evidence (Also see Introduction to Audit Evidences) for the destruction or loss of the share certificate and state the amount if necessary.
If there is a transfer of shares (Also see Why Do Companies Repurchase Their Own Shares?) related to the share certificate, the certificate should be sent to the company so that the company can register the transfer. After that, the company should cancel the share certificate, and it should not issue the share certificate anymore except if the transferee requests for it.
If the company or any officer has failed to comply with the rules mentioned above, they would have committed an offence. Those who contravene this should be liable to a penalty of less than RM10,000 on conviction.
There are some occasions where a company (Also see How to Differentiate Net Income and Cash Flow of a Company?) may fail to deliver the share certificate based on the requirements above. If such a condition happens, the individual who is entitled to the certificate can send the company a notice that requests it to deliver the share certificate to him in 14 days from the notice. If a company fails to obey this, the shareholder can apply to the court for an order. The order serves to direct the company or any related officer to send the certificate to the individual in the period stated in the order. The order may also contain incidental to, and all costs of the application the company or the related officer need to bear if it fails to send the share certificate to the person within the period stated in the order.