The register of members is a document that the secretary should keep and maintain regularly. The secretary is responsible for entering the particulars of issuance and transfer of shares in this document. This is a crucial responsibility, and it is vital to appoint the right person for this task. If you want to ensure that these processes are done correctly, you may seek help from a corporate secretarial firm in Johor Bahru and let the professionals complete these complicated tasks for you.
If an individual found out that his name is keyed in or removed from the register of members wrongly, he may make an application to the Court. The Court may call for the rectification in that document, compensation for the loss sustained, or both rectifications as well as compensation. If a person has applied for it, the Court may order the company to rectify the register of members. The Court may also order the company or officer who made a mistake to pay an amount of compensation for the loss the individual has suffered. It may ask for both the rectification as well as the payment of compensation too.
The shareholders or the debenture holder can transfer part or all of his shares or debentures. The transfer should be accompanied by a duly stamped and executed instrument of transfer, and the individual should report the transfer to the company. For the transfer of shares or debentures to take effect, the company should enter the transferee’s name in the company’s register of members.
The company should enter the transferee’s name in the register of members as the company’s (Also see Why Do Companies Repurchase Their Own Shares?) shareholder in 30 days from the day it receives the instrument of transfer. However, there are some exceptions to this.
One of the situations is the Companies Act or the company’s constitution expressly allow the directors to turn down or delay the registration for the stated reasons. The other case will be when the directors had passed a resolution to turn down or delay the registration of the transfer in 30 days since the company receives the instrument of transfer. If this happens, the resolution should state clearly the reasons why the company refuses or delays the registration. Lastly, the company can be excepted from this if the company has sent a notice of resolution to the transferor and the transferee in 7 days since it passed the special resolution. In the case of a public company, it should include the reasons it refuses or delays the registration in the notice of resolution.
According to the company’s constitution, the directors of the company may turn down or delay the registration of the transfer of shares if the shareholder is unable to pay the amount due regarding the shares. If a company reject the registration of a share transfer, the transferor or the transferee can make a formal request to the Court for an order. Once the application is made, if the Court thinks that the application is justifiable, it may instruct the company to register the share transfer.