COMPANY LAW- INTRODUCTION TO SHARES- SECTIONS 42 , 43 , 44 AND 45 OF COMPANIES ACT 2019 ( ACT 992) скачать в хорошем качестве

COMPANY LAW- INTRODUCTION TO SHARES- SECTIONS 42 , 43 , 44 AND 45 OF COMPANIES ACT 2019 ( ACT 992)

PART 1 — THE LEGAL NATURE OF SHARES (SECTION 42) Section 42 provides that “the shares of a member in a company are movable property” and that the number of shares and the rights and liabilities attaching to them depend on the terms of issue. A share is therefore not a physical object. It is a bundle of intangible proprietary rights created by statute, the constitution, and the terms on which it is issued. These rights include the right to vote, the right to dividends, the right to surplus assets on winding up, the right to transfer, the right to information, and the right to seek remedies for oppression. Company law writers describe a share as a measure of the shareholder’s interest in the company. Section 42 codifies that proposition: there is no abstract concept of a share outside statute and constitution. Why describe shares as “movable property”? Because they can be sold, transferred, pledged, inherited, or transmitted. Transfer becomes effective upon entry in the register. Courts have repeatedly emphasised that directors must exercise transfer powers bona fide and in accordance with procedure. This proprietary character makes shares the fundamental currency of corporate finance. PART 2 — THE NO-PAR VALUE REGIME (SECTION 43) Section 43 abolishes nominal value. All shares created under Act 992 are no-par value shares. A shareholder’s liability is limited to the amount agreed as consideration. Under the former Act 179 regime, shares had a fixed nominal value and could not be issued below par. Companies maintained share premium accounts. This system was artificial and often disconnected from economic reality. Act 992 replaces that framework with stated capital. The value contributed for shares forms part of stated capital. There is no legal fiction of “par value,” no prohibition on issuing below nominal value, and no share premium account. This reform aligns Ghana with modern jurisdictions such as Canada and New Zealand. The advantages are significant. It prevents manipulation of nominal figures, permits flexible pricing of new issues, simplifies financial reporting, and better reflects economic substance. The only limit on liability is unpaid consideration. PART 3 — ISSUE OF SHARES (SECTION 44) Section 44 permits the company, subject to its constitution, to issue different classes of shares at the times and for the consideration it determines. In practice, the power to issue shares lies with the directors. This power is not absolute. Issuing shares alters capital structure and can dilute control. Therefore, directors must comply with fiduciary duties under section 197. They cannot issue shares for an improper purpose, such as entrenching themselves in office or manipulating voting control. Nor can they use issuance as a device to oppress minority shareholders. Any issue must also comply with disclosure and filing requirements. Thus, share issuance is both a financing mechanism and a governance decision. It is central to corporate strategy and minority protection. PART 4 — PAYMENT FOR SHARES (SECTION 45) Section 45 requires that shares, except in capitalisation issues, be issued only for valuable consideration. Consideration may consist of money or non-cash assets such as land, machinery, goodwill, know-how, services, or debt set-offs. The principle is simple: every share must be backed by real value. This protects creditors and prevents artificial inflation of capital. Importantly, directors must ensure that non-cash consideration is fair and reasonable to the company. Failure may constitute breach of duty and expose directors to personal liability. The statute also imposes penalties for non-compliance and mandates proper returns of allotments.