A new shareholder can generally enter a company either by receiving newly issued shares or by acquiring existing shares from another shareholder. The legal process differs depending on which method is used.
New share issue
Where the company issues new shares, it may need to:
- confirm sufficient authorized capital;
- follow pre-emption or existing-shareholder rights;
- obtain board or shareholder approval;
- receive payment;
- allot the shares;
- update the shareholder register;
- file the change with OCR.
Transfer of existing shares
Where existing shares are transferred, the company should follow the transfer procedure, including transfer documentation, approvals and register updates.
Foreign investors
Adding a foreign shareholder can trigger foreign-investment approval and regulatory requirements before OCR records the change.